If you are a Real Estate investor, chances are you have given some thought to upgrading one or more of your properties.
Will renovating allow me to charge more in rent? How do I market these upgrades? Is it even worth the hassle? What will happen to the value of my investment?
The experts at S&D answer these questions for you, and more! Here is when it just makes plain sense to invest in upgrades – and when it doesn’t.
Broken vs. outdated
Just like the age-old saying goes, “If it ain’t broke, don’t fix it.”
However, some things could benefit from an update even if they are in working condition.
You will have to evaluate if the upgrade would be worth it in the long run. By replacing kitchen appliances with all new stainless-steel items, you can probably charge a bit more in rent as this is a sought-after and popular upgrade.
Replacing a washer and dryer that are already in good working condition with upgraded and more attractive units may not bring in much more dough. This is because these types of appliances are typically tucked away, and renters will not care about their appearance.
Also, keep in mind that certain replacements, such as a new roof, can help you to save money on homeowner’s insurance.
Making smart upgrades is all a matter of knowing what tenants will desire in a rental.
The needs of your renter
Your current tenant may be ready to end their lease if they are itching to move into another home or spiffy new apartment complex that has more improvements and amenities.
As a landlord, you probably know that there is a burden that comes with placing a new tenant and getting the unit ready for them.
If you already have a great quality tenant and want to avoid the turnover process, promising them some upgrades they desire may get them to stay.
Plus, these upgrades can help add value to your property – it is a win-win!
Return on investment
The biggest reason for a landlord to renovate their investment property is that it will add to their property value.
Kitchens and bathrooms are two of the top remodels that will give you a large return on your investment.
In addition, you can bump up the price of rent since the property value has been enhanced.
If you are still unsure whether or not a renovation is right for your investment property, our Property Management division is skilled in advising on which updates and renovations are fitted for a property.