How Much & When Does Your Investment Property Need Sprucing Up?
One of the things that seem to bother would-be investors is their duties as a landlord. Will they need to make home improvements? How much will this cost? Does a landlord have to spend a lot to earn a good rental income? These are valid questions and I address them in this short video.
A new home needs little or no improvements.
If you’ve followed good advice, you’ve bought a brand new home as an investment. You’ve bought it directly from the builder so that everything in the home is brand new – bath fittings, roof, home appliances, HVAC et al! So there is no need for repairs or upgrading or refurbishing. Your investment is ship shape and read to be rented out to fetch you top dollar in terms of rental income. Your first tenant is happy to pay as well, since they have the chance to move into a new home where everything works and nothing is leaking or broken.
Now say your tenant is moving out after one or a few years of renting your property. There is bound to be a little wear and tear, some few rough edges that need smoothing. Maybe the carpets are a little worse for the wear and the interiors need a bit of sprucing up. Maybe the carpeting doesn’t need to be ripped out and replaced; just steam cleaning could make a world of difference. After some years of use, the interiors will need a coat of paint. A new lick of paint for the exteriors may not be a mistake either after a while. Families looking at properties to rent are looking for aesthetically well-looked after homes to live in.
Why a property manager is your best friend in this case.
So it can all be a little confusing – what to do so that your property continues to fetch a good rental income, and what not to do because it could just be a waste of good money. Here, the insight and experience of your property manager will be of great help. The property manager knows what tenants are looking for, and what factors will decide rent amounts. They will advise you when and if home improvements are required.
Maybe after a few years of the same tenant, a paint job is needed to attract a new tenant. Or maybe not! Most tenants want all of their security deposit back and will ensure that they leave your house in good condition. However, a little landscaping may not go amiss if the previous tenant wasn’t much of a gardener. Remember, the location of the property, local weather conditions will also make a difference. The property manager may be the best person to advise you about what is needed and what isn't.
Maybe your home needs no improvements or refurbishments. On the other hand, maybe it does – it is a case of spending a little money to make more money. The rule of thumb with home improvements for rental properties is this: trust the experience of your property manager and follow their advice to the extent possible. Listen to my podcast or visit icgre.com to know more about real estate investments.
