Keeping your rental property well-maintained ensures your tenants are happy, and your property gets rarely vacated.
But in order to create a more positive cash flow for your investment, and even increase the market value of your property, considering property upgrades can boost your rental profit. The mention of spending for upgrades or renovation expenses easily scares many landlords, but the trick here is to identify which areas to improve that will both benefit your tenants and bring higher return on investment.
Here are some upgrades that will help maximize your investment property without overcapitalising:
One of the top renovations for profit recommended by many experts is redesigning the kitchen. Nowadays, modular kitchens are the trend – and they improve the livability of a house or apartment without costing the owner too much money.
To ensure you get a well-designed kitchen, use a custom kitchen builder as they will supply and install the cabinets as well as offer a warranty. Be consistent with your renovation designs as well, as the lack of aesthetic value can drive away potential tenants . For example, do not combine an expensive, branded kitchen appliance (like a stove) with poor quality cabinets and storage that are not durable.
The number of bathrooms in new homes has been on the rise, with an average of 2.6 bathrooms per home today. It makes sense to update or add a bathroom, as tenants and buyers clamour for modern, clean and stylish fixtures and fittings in this area of a property.
Make sure to set a clear budget at the outset of the project and make it a goal to stick to a fixed price. It is easy to spend too much as there are many parts or components to a bathroom.
Repainting the walls with modern colours and shade is probably one of the best ways to boost the appearance of a home’s interior. Choose a neutral colour throughout so it would be easy for tenants or buyers to bring in whatever furniture they have from their old place. A light colour on the window frames will attract the eye outside, creating the illusion of a bigger space.
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There is trend nowadays towards creating an outdoor area that offers indoor outdoor living. In the past, it was enough that a patio has a barbecue grill and some chairs. Now, the outdoor area is considered an extension of the inside of the home. The outdoor area has the power to evoke the emotions of buyers and tenants. They see a well-designed patio area, imagine themselves relaxing in there and they are sold.
There are small, inexpensive jobs you can do to boost the profitability of your investment property such as:
- Install a new modern door to increase the curb appeal of your home.
- Install new door handles.
- Install secure locks and/or security doors.
When making a renovation for profit, plan it with a broad audience in mind, instead of including too many elements based on your personal tastes and preferences. Remember that you’re not going to live in the property, other people with likely different tastes from yours, will.
Double check the costs of your upgrades. To ensure you are not being overcharged by tradespeople or suppliers, hire a quantity surveyor for the major jobs to give you the figures on labour costs, material costs and tax deductions that you are entitled to claim.