Property managers and landlords are always looks for the types of upgrades that can lead to rent increases so here are some ideas.
By Lucas Bergman
It’s in your best interest, as a landlord, to keep your rental property in top shape.
While in most cases this requires periodic overhauls, there are some relatively affordable upgrades that allow you to increase the rent at each lease renewal period. So, whether you’re managing an apartment building or a multifamily home, here are some of the sure-fire upgrades that tenants are going to fall for.
Add another bedroom
While adding a bedroom without increasing the home’s square footage isn’t always possible, if you can squeeze it in, it would be a great way to increase the unit’s potential income. Keep in mind, though, that there are building codes that specifically determine what can be considered a bedroom, so you may want to check that out before you start, unless you want to end up with an extra storage room.
This kind of upgrade requires obtaining a permit from your local building department. For most codes, a bedroom needs to have a door, a closet and a widow to the outside. If your rental unit has a room of another purpose, you may even modify it to fit into the bedroom role.
Update your flooring
Although carpet and vinyl are the typical choices for many landlords, they don’t scream either luxury or style. They are inexpensive, durable, and most importantly, cheap, but if you’re looking to increase the rent in the next lease period, you need something more attractive. Wood flooring is a premier high-end option that will surely appeal to renters, however, laminate flooring is not only more affordable, but also more durable for rental situations, which often include a bit of furniture-moving and reorganization. So, while laminate floors don’t have the same value-retaining curve as wood flooring, in general it’s a better investment for landlords.
Focus on kitchen and bathroom
If you’ve ever wondered which space adds most value to rentals buck for a buck, it’s the kitchen and bathroom.
You can make them much more attractive to prospective renters if you declutter them, clean them thoroughly, refinish the surfaces, and modernize the appliances. Such an updated kitchen will typically give you better ROI than other renovations, as well as lower your maintenance requests, so you won’t only save time, but also money in the long run. And here’s an unexpected bonus: if you make the effort to integrate green upgrades such as low-flow toilets, Energy Star water heaters, and dual-flush plumbing, you can even apply for government grants for energy-efficient upgrades or have them depreciate against your taxable income.
Give it a new roof
This often overlooked upgrade comes with many benefits for both the renters and the owner. However, in most cases, it’s the difficult access and the amount of work that turns landlords from roof updates. In order to upgrade your property you might want to speak with a contractor, or, if you’re handy, you might decide to do it yourself. You’ll have to find a reliable crane hire company before everything else. With the right crane, you’ll be able to move the materials and access even those tricky places.
However, in most cases it’s the difficult access and the amount of work that discourages landlords from roof updates. New roofing and underroof insulation give your tenants an opportunity to lower the heating and cooling costs, at the same time improving the building’s resale value.
Don’t forget the landscape
For many renters, the home’s exterior is almost as important as the interior, especially in the suburban neighborhoods, where people are likely to spend a healthy share of time in the back yard. So, if you want to spruce up your curb appeal and landscape in general, you’ll want to fill those dry lawn patches with new grass, trim overgrown bushes and trees, and clean up any garden debris. If you want to go an extra mile, consider including low-water landscaping elements, such as native grasses and plants, stones, and gravel mulch in flowerbeds, which prevents weeds from taking root.
Rental properties are long-term investments that don’t always increase the landlord’s margin as much as planned, especially if the monthly mortgage rent draws near the maximum rent that can be charged each month.
The key in renovating for higher rent is to choose upgrades that potential renters will recognize as life-improving, so they are willing to pay the extra buck for them. (And no, that saltwater aquarium isn’t the best idea.)