Investing in rental properties is one of the oldest forms of investing in the market, and is still considered to be one of the most lucrative.
A study conducted by The Pew Research center based on the analysis of U.S. Census Bureau housing data determined that the number of Americans renting their homes is higher than it has ever been since 1965. The rental market is booming, so you are not alone if you’ve decided to become a part of it. A favorite pastime of real estate investors is to purchase out-of-date homes and then renovate them in order to make them appealing to the consumer rental market.
This strategy can save money in the long run by reducing your overall investment and can give you an edge on the market by allowing you to list a more modern home for rent. Whether you are a first-time rental owner conducting their first renovation or a seasoned professional, we have found that these dos and don’ts when renovating a rental property are words to live by.
Do: Keep it Simple for the DIY Projects
Ever seen what a fresh coat of paint can do to a house? It can be astounding. Painting and other simple projects like deep cleaning, replacing the hardware on kitchen cabinets, replacing old screen doors with high-quality storm doors, and other inexpensive DIY projects can make a tremendous difference in a rental property. The trick, however, is just that. Keep it simple. Over investing in complicated aesthetic projects like granite kitchen countertops, lavish front doors, and all new kitchen cabinets can be become extremely expensive very quickly. In rental investments, positive cash flow is king. Aesthetic improvements in rental homes should be kept simple, tasteful, and neutral. Remember that this is not a home for you, and there is no way to predict the taste of whatever renter ends up on the lease agreement.
Don’t: Underestimate Curb Appeal
It is easy during a rental renovation to become too focused on the interior of the house and forget that the first thing a potential renter will see when they pull up out front is the exterior. This doesn’t just include the exterior condition of the house itself, but can stem to the sidewalk leading to the house, any flower beds or shrubbery in plain sight, and the front and back yards. Just like with interior aesthetic projects, simple, crisp, and clean is the name of the game for rental exteriors. Consider planting low maintenance shrubs in any flower beds, along with a fresh layer of mulch. Make sure all sidewalks are clean and freshly weeded. A good power-washing of the exterior of the house and any sidewalks or porches can work wonders for the overall exterior look of your rental.
Do: Hire a Professional For Major Renovations
Major remodels or renovations like kitchens and bathrooms are complicated projects that require a vast amount of experience and knowledge in the renovation field. Unless you come from a contracting background and possess the specific skills to undertake these major projects, hiring a professional is an absolute must when renovating a rental property. In the Boston area, R.H. Blanchard Contract & Design is one of the most reputable renovation companies for both residential and commercial projects. Before making an attempt to tackle your major remodel on your own, consider reaching out for a consultation to discuss your project. Trying to complete a renovation project that is beyond your experience level can lead to devastating consequences that could lead to thousands and thousands of dollars in additional costs in the long run.
Don’t: Forget to Do Your Research
When determining the budget for your rental renovation, make sure that you are researching what return on your investment you can expect in your area based on statistics like average rental prices and the average length of tenant stay. Familiarizing yourself with the rental market in your area is imperative to making smart investments in rental properties and improvements. If you are renovating a rental property, check out the R.H. Blanchard blog for trends in the Boston real estate market and tips and tricks for being a savvy rental investor.