How To Increase the Value of Your Rental Property
“Should I renovate my rental property?” might be a question that crosses your mind from time to time. The answer, if you hope to get more from your investment properties, is yes. Updating a rental property can involve everything from giving all the walls a fresh coat of paint to remodeling the kitchen and bathrooms too.
Learn more about the best renovations for your rental property in Central Pennsylvania and the best ways to complete them to get the most return for your money. Here are the top six improvements to increase rental value in Central PA.
1. Remodel the Kitchen at Your Rental Property
Even among non-cooks, the kitchen is the heart of the home and is the one room people are most likely to scrutinize when choosing a rental property to call home. Although you might envision an expensive project when you hear the phrase “kitchen renovation,” the truth is improving your property’s kitchen doesn’t have to cost a lot.
For example, all the space might need is a few superficial improvements, such as swapping out tired, old drawer pulls and door handles for new ones or adding a new backsplash or a fresh coat of paint.
Depending on the extent of your remodel, upgrading a kitchen in a home in the Harrisburg area can have a return on investment anywhere from 59 to more than 75 percent of the cost of the project , according to the 2017 Remodeling Cost vs. Value Report. In the Lancaster area , upgrading a kitchen can have a return on investment from around 32 percent to nearly 54 percent . In other areas of Central PA and the rest of the Middle Atlantic region, the return on investment for a kitchen upgrade was from 62 percent to around 80 percent in 2017.
2. Remodel the Bathroom at Your Rental Property
Next to the kitchen, the bathroom or bathrooms are the most important spaces in a rental property. Potential tenants are usually looking for an area where they can relax and unwind at the end of the day or for a space that will let them get ready in the morning with ease.
Like a kitchen renovation, upgrading a bathroom doesn’t have to involve making significant changes. Replacing tired fixtures or adding a fresh coat of paint might be sufficient for a rental property.
3. Improve the Floors at Your Rental Property
Some types of flooring are better than others for rental properties. Usually, it’s best to switch to something durable, that can withstand years of wear and tear from tenants, rather than something that might look nice when you’re showing the place but quickly need deep cleaning or replacement.
Hardwood or laminate floors are often ideal picks for areas of the property that see a lot of foot traffic, such as the hallways and living areas, including bedrooms. In areas that get exposed to humidity, such as the bathroom and basement, water-resistant flooring, such as vinyl or tile, is often best.
Carpet has its advantages, mainly that it can provide some sound insulation and warmth, but can also become stained and worn out more quickly than other types of flooring. If you are going to choose carpet, it’s best to limit it to areas that don’t see a lot of foot traffic, such as the bedrooms.
4. Upgrade the Lighting in Your Rental Property
Your tenants will be willing to pay more to live in a home or apartment where they can see themselves, thanks to decent lighting. Good lighting also makes a home more inviting.
You have a few options for improving the lighting in a rental property. One is to swap out older fixtures for newer styles, which can not only make the space brighter, it can also bring it up-to-date. When you trade in tired lighting fixtures for new models, you can also improve the bulbs used in those fixtures.
Swapping out incandescent bulbs for LEDs won’t just modernize your rental, it will also help your tenants save money on their electric bills.
Another way to improve the lighting in your rental is to re-think the windows. Changing out the windows in a property is usually a considerably more expensive project than investing in new lamps. But if the windows in a home leave a lot to be desired, and replacing them would bring in more light, it might be worth the cost to fix them up.
5. Increase Storage Space at Your Rental Property
In many rental properties, storage space is either non-existent or barely there. That can lead to renters doing creative things to find a place to put all of their belongings. It can also drive renters to pass up on a property that is otherwise just right, in favor of one with bigger closets.
One simple way to make your property more appealing to renters and to increase the rental value of a home is to find ways to add storage. That can mean installing a closet in a bedroom or the living room or offering a separate, secure storage area for each tenant in the basement of a multi-family building.
Even small improvements that increase storage can make a big difference when it comes to how desirable and valuable your rental property is. For example:
- Attach hooks for hanging bags or keys by the front door
- Add wall shelves to a bedroom or in the kitchen
- Hang rods and hooks in the bathroom for towels and other linens
6. Boost the Energy Efficiency of Your Rental Property
Improving the energy efficiency of your rental helps your bottom line in a couple ways. First, it makes the property more appealing to tenants so you can ask for more rent. Second, it helps shave a few dollars off of the unit’s energy bills, which helps you if you cover utilities such as heat or electric and helps your tenants save on their bills every month.
You have a few options when it comes to improving the efficiency of a rental property. A major project would involve replacing older windows with energy-efficient models. Energy Star-rated windows provide insulation against cold air in the winter and also help to reduce heat gain indoors in the summer.
Another way to make a rental property more energy efficient and more valuable for you and your tenants is to swap out older appliances for new Energy Star-rated models. For example, trading in a refrigerator produced between 2001 and 2010 for an Energy Star model will save you about $160 over the course of five years. You’ll save even more, up to $386 over five years , if the refrigerator is older than 2001.
How to Choose the Best Upgrades for Your Rental Property
When renovating a rental property, which upgrades should you focus on? It all depends on the condition of your rental and how much you can afford to invest in the remodel or renovation. If your investment property is on the older side, more extensive repairs and renovations are usually in order. But with a new property, you might find that you only need to make small updates and changes to increase the amount of rent you can ask for each month.
In some cases, it helps to weigh the cost of the remodel against the potential value of it, regarding rent and resale.
For example, a mid-range full bathroom remodel typically costs more than $19,000 in Central PA and the Mid-Atlantic area. Owners who remodel the bathroom often see a return of nearly 59 percent when they sell their properties, according to the 2017 Remodeling Cost vs. Value Report.
Throughout the Mid-Atlantic region, replacing the windows on a property can range in price from a little over $15,000 to more than $19,000 , and usually has a return on investment around 66 percent.
Rental Property Kitchen Renovation Tips
If you’re going to give the kitchen in your rental property a bit of a facelift, these tips will help you keep costs down while making the space look impressive.
- Rethink the materials for the counters . You don’t need to install pricey granite counters in your rental kitchen. Two more budget-friendly, but still durable and attractive, options include tile counters and engineered stone. Just as you want to skip the high-end counters, it’s also a good idea to avoid going too cheap with your materials —laminate counters might save you money, but they also show signs of wear and tear much sooner than others.
- Leave the plumbing where it is . Unless the kitchen sink is in an awkward spot or there’s no room for a dishwasher with the current setup, you’ll save money and hassle if you let the plumbing alone.
- Go for classic over contemporary . Remember that you’re not renovating your own kitchen. You don’t want to give the space too much flair or go too trendy with your style choices, as those decisions won’t appeal to every renter.
- Focus on innovative storage solutions . Kitchen space is often at a premium, especially in smaller homes and apartments. When renovating, find ways to add storage to the area. That can include adding hanging pot racks, installing wall shelves or pantry storage, or adding pull-out drawers and shelving to existing cabinets.
Rental Property Bathroom Renovation Tips
After the kitchen, potential tenants are going to be focusing on the bathroom. From large to small changes, there are a few things you can do to make the bathrooms in your rental more appealing.
- Replace the toilet . There are a few reasons why it can be worth replacing the entire toilet in a bathroom. It might be worn out and run continuously, it might use more water than it needs to per flush, or it just might be outdated and unattractive-looking. If the toilet is relatively new, you might be able to get away with replacing the seat and cover, rather than the entire fixture.
- Leave things where they are . As with the kitchen, you’re better off leaving the sinks, shower/tub and toilet where they are rather than trying to relocate them to a different area of the bathroom.
- Improve the showerhead . While you might not want to move the shower, replacing an older showerhead with a rainfall model can make the bathroom that much more attractive.
- Increase storage and counter space . Even if just one person lives in your rental property, the bathroom is going to see a lot of use. Increasing storage and counter space will make the room that much more usable. You might consider adding a medicine cabinet if there isn’t one already, adding a free-standing, humidity-resistant storage unit or trading a free-standing sink for one with an attached cabinet.
- Swap out shower curtains for doors . Shower curtains, especially in rental properties, can get grungy and mildew very easily. Glass shower doors help a potential renter see how clean and tidy the bathroom is, increasing their opinion of the place as a whole.
General Tips for Renovation of an Investment Property
While you might want to focus as much time and money on the bathroom and kitchen as possible, don’t neglect the rest of the property. These tips will help you save time and money when renovating the entire house.
- DIY as much as you can . You’ll get more bang for your buck when remodeling a rental if you’re able to tackle specific chores on your own. For example, you can pick up supplies from the store, rather than pay for delivery. You might also be able to handle specific demolition tasks on your own. Painting and replacing handles and knobs are also projects you can easily DIY.
- Reuse as much as possible . While some materials might be well past their prime and best left for the landfill or recycling, you’ll save money if you find ways to reuse some materials. For example, those tired kitchen cabinets might just need a new finish or a new coat of paint, rather than a full-on replacement.
- Maintain your changes . If you don’t take care of the things you’ve updated in the rental, you’ll be back at square one before you know it. Maintaining the property can mean scheduling regular tune-ups for certain appliances, such as the furnace or HVAC system, and scheduling regular cleanings for other fixtures and features.
4 Quick Ways to Update Your Rental Property
A significant renovation or remodel might not be in your budget or might not be something you have time for right now. While redoing the bathroom or kitchen and making other big changes can boost the value of your rental property considerably, a few small improvements can also produce decent results. Make your rental more appealing and more rentable by doing the following:
- Increase the Curb Appeal of Your Rental Property
Don’t underestimate the power of a manicured lawn or a few flowers planted by the front entrance. It can be worth it to hire a landscaping company to visit regularly to cut the grass and refresh the flowers and plantings at the front of the house.
- Install New Doorknobs at Your Rental Property
Just as replacing the door handles and drawer pulls in the kitchen and bathroom can instantly improve the look of the room, so can installing new doorknobs on the interior doors and the front and back doors of the property.
- Deep Clean Your Rental Property
In some cases, items don’t need to be replaced, just deep cleaned. A professional carpet cleaner might be able to remove years of stains and pet odors from a carpet, for example. Scrubbing the title in the bathroom and cleaning the oven can make those things look like new.
- Give the Rental Property’s Walls a New Coat of Paint
While some tenants are willing to paint a rental themselves, you’ll get more consistent results and make your property more appealing if you paint all the walls between tenants. Stick with a neutral color, such as white or off-white, so that you don’t scare anyone away.
Work With a Property Management Company
Whether you own property that’s far from your home or just want help handling the day-to-day responsibilities of a rental property, working with a property management company can help you keep your property up-to-date and appealing for tenants.
To learn more about the advantages of property management services in central PA,
contact American Heritage Property Management today.
Share this post
