To generate more rental income, it’s sometimes necessary to put a little work into your property. If a potential renter is comparing your property to a similar, less expensive property, the renter will need to be able to easily identify those aspects (whether it’s aesthetics or features) that make your unit worth more than the competition’s. Depending on where you’re starting from and where you want to go, upgrades may consist of as little as some simple “rejuvenation” projects or, alternatively, some larger-scale renovations.
Generally speaking, your bathroom and kitchen are two key areas that play a large role in making or breaking the value of your rental unit as compared to competitors’. All other factors being equal (such as size and location), chances are most renters will select the unit with a nicer looking or more upgraded bathroom or kitchen. Many renters will even be willing to pay a bit more if there is a noticeable difference or greater utility in one or both of these two rooms. In other words, these are the first places you should make improvements if you want to command additional rental income for your property. What does this mean exactly? Let’s take a look.
There’s not really any way around it—complete renovation of a bathroom or kitchen (appliances, lighting, tiling, fixtures, etc.) will cost you a few thousand dollars. However, it will also likely pay off in the form of a higher rent rate.
Consider a renter who is looking at your apartment and another similar one in your neighborhood. The apartments are the same size and age. However, your apartment has a new, updated kitchen complete with a dishwasher, updated appliances, new tiling, flooring, and lighting. Similarly, your bathroom has recently been redone—new tile, new tub, new sink, the whole nine yards. With all of these new upgrades, it’s likely that you can now command up to an extra $200 per month, depending on the rental market in your area. With that in mind, even if you spend a few thousand on each room, you will earn your investment back quickly because of your new-found ability to command a higher rent rate.
Let’s say that you simply don’t have the desire (or the financial resources) to make these overhauls. You can still drastically improve the aesthetic appeal of your units by making smaller changes that have a big impact. For the kitchen, put in new countertops, flooring, or up-to-date hardware on cupboards and drawers—this is a great way to modernize a dated kitchen, and can be done fairly inexpensively. Similarly, you can put new faucets and lighting fixtures in the bathroom or perhaps update the mirror for a more modern look. You can also consider re-doing bathtub porcelain with Miracle Method, which will cost far less than replacing the tub altogether.
Changes like these are far cheaper than a complete overhaul (a few hundred dollars as opposed to a few thousand dollars) and will still allow you to raise rent prices, though perhaps less significantly.
In addition to renovating or updating bathrooms and kitchens, remember that flooring or carpet should be thoroughly cleaned, waxed, or polished (or replaced if necessary). Particularly when showing vacant apartments to potential tenants, flooring provides a clear indication of how well-kept your unit is and adds to aesthetic appeal. The better impression you make, the easier it will be to command the rental rate you desire.