When is it Time to Renovate Your Rental Property?
Renovating a rental property can increase a home’s rental value and provide owners with more cash flow and larger returns in the long term. However, constantly pouring money into your rental property can get expensive and if you’re not careful, it will actually hurt your cash flow.
Today, we’re looking at some ideal situations in which a renovation may make sense, and we’re considering which renovations are the most cost-effective for real estate investors.
Renovate Before You Rent the Home
If you’ve just acquired a home or you’re moving out of a property that you once lived in so you can rent it out, a few renovations will probably be required to get it ready for the rental market.
Check the condition of the floors and the walls. Fresh paint gives the entire home a feeling of newness, and prospective tenants will notice. Renovating your property before you list it will attract better tenants and reduce your vacancy time.
Renovate Between Tenants
All landlords want their good tenants to renew their lease agreements year after year. But, if your current tenant is moving out, it’s a good time to take a look at the property and make some changes that will increase your ROI and maybe allow you to charge more in rent.
Renovate When You’re Ready to Move On
If you’ve been renting your property for 20 years and you’re ready to sell it and do something else, you’ll want to make some renovations to prepare it for the sales market. Wait until your tenants have moved out, and then make all the changes your real estate agent recommends to sell the home quickly and for the price you want.
Renovations are an important way to make your rental property competitive and attractive to good residents. It’s important to balance the cost against the outcome.