If your rental property feels out-of-date or needs some work, there’s no time like the present to get started. By investing back into your rental, you can accomplish several goals: you can make it more attractive to renters, you can add to its long-term value, and you can potentially prevent future issues. In this article, we’ll discuss the best places to start investing back into your property.
Make any essential repairs first
While remodeling your rental’s kitchen or bathroom can add value to the property, not making these changes won’t necessarily decrease your property value or lead directly to the loss of rental income. The same can’t be said for significant problems with the property. It might seem like the equivalent of eating your vegetables before you can have dessert, but you need to focus on essential repairs first before you invest in any upgrades to the property.
What constitutes essential repair? Consider any projects that—left untreated—will either cause damage to the property, lead to the loss of rental revenue, make your property harder to sell, or all three combined. A gas furnace on death’s door, for example, could be at high risk of a breakdown next winter. Not only will a problematic furnace reduce your property’s curb appeal but, here in Chicago, property owners and managers can get city fines in the winter if they don’t restore heat to the rental right away. Air conditioner repair in Chicago is just as essential in the summer.
Other essential repairs include those involving the property’s structure, roof, pipes, and electrical wiring. While paying a plumber to repipe your property is a lot less exciting than a kitchen remodels, you’ll benefit by avoiding many potentially expensive and stressful disasters down the road.
Remodel the kitchen or bathroom
If you’ve dealt with any essential repairs and you’re ready to add value to your rental property, you should next turn your attention to the kitchen and bathroom. Mid-range kitchen and bathroom remodel among the best projects for rental properties; they make your rental far more attractive to prospective tenants and provide a long-term boost to its value.
When remodeling your rental’s kitchen and bathroom, you need to take a different approach than if you were remodeling your own home. In a rental, it’s all about return-on-investment: you want to get the most long-term value possible out of what you put into the project. This means knowing what materials you use, limiting the scope of the project, and avoiding luxury upgrades. You would also want to make style choices that appeal to the broadest possible range of prospective renters and buyers.
You’ll want to save money by limiting the scope of your changes, not by cutting corners. Buying cheap, shoddily made materials or hiring unqualified contractors can come back to bite you. You’re taking a serious risk that the result isn’t going to bring you the value boost you’re expecting.
Upgrade the property’s energy-efficiency
Many renters feel financially squeezed in the summer and winter when high utility bills join their rent and other living expenses. In particular, the high cost of cooling and heating the property can put stress on renters. For this reason, more and more renters are starting to ask about a property’s energy-efficiency before signing a lease. Unless you include utilities into their monthly payment, they realize that a property’s inefficiency could be, in effect, a hidden cost they have to pay. If that cost is high enough, they’re going to look to move again as soon as their lease is up.
Property owners and managers should meet this renter insecurity head-on. An excellent way to deal with this problem proactively is by investing in the property’s energy efficiency. Making even minor changes can move the needle in this area, helping to save your renters’ money every month. Not only will your tenants be happier, but you’ll also reduce stress on the property’s HVAC systems.
Some good projects to tackle include adding attic insulation, installing a smart thermostat, caulking around windows, and sealing around doors. You can also consider replacing single-pane windows with dual-pane or triple-pane ones or installing new appliances.
Start investing back into your property
For property owners and managers, now’s a great time to invest back into their property, boosting its value and attractiveness to renters. For even more home upgrades that pay off over the long haul, check out this infographic from King Heating, Cooling & Plumbing, a local HVAC company right here in Chicago.
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