Are you renovating an investment property but not exactly sure what you need to do to maximize the return or rental rate?
Renovating an investment property can be tricky business. Obviously, you want to make as large of a profit as possible. However, you also want to make sure you aren’t cutting any corners for the sake of making more money.
Basically, you need to know which renovations are going to increase the value of the home, without going overboard.
So, how do you figure this out?
Read this article to find out the top 5 tips for renovating your investment property into a money making machine.
1. Focus on Small Repairs
Repair before replacing is going to be your new mantra during the renovation process.
Repairs are always going to be cheaper than replacements, so always make replacing your last ditch option.
Whether it’s carpets, floors, or light fixtures, focus on cleaning them and repairing them first.
If there’s something that is completely broken, see if you can replace parts of it before forking over money to replace the whole thing.
For example, if a cabinet has a broken handle, replace that rather than the entire cabinet. If the sink is broken, make sure to see if you can replace some of the faucet hardware before reinstalling a whole new unit.
Also, if you do need to replace an entire cabinet, sink, countertop, or tub, go for the off-the-shelf items that won’t burn a hole in your pocketbook.
2. Focus on Kitchens and Bathrooms
Yes, we might spend the most time in our living rooms and bedrooms, but the kitchens and bathrooms are what sell the homes.
If you don’t focus on updating these rooms, you’ll have a much harder time selling the home.
Focus on replacing anything that makes these rooms look dated, such as the flooring, wallpaper, or countertops.
You can use a remodeling calculator to give you a rough idea of how much you’ll be spending.
3. Nail the First Impression
What’s the first thing buyers will notice when they pull up to the driveway?
Hint: It’s nothing inside the home.
That’s right, it’s the exterior. A fresh coat of paint and a spruced up landscape can go a long way when selling an investment property.
These first impressions can make or break your investment return, so make sure they get the same amount of care and consideration as your interior.
4. Wash Walls and Repaint
You won’t believe what some washing and repainting will do for your property.
When you repaint, stick with light, neutral colors. Neutral is best for making people feel like they can easily match their own decor. And light helps make space feel bigger.
5. Establish a Budget
Once you have an idea of what needs to be fixed- something you hopefully had an idea about before you purchased- it’s time to establish a budget and stick to it.
If unforeseen expenses come up, don’t break the budget. Just cut back on non-essential repairs.
Investment Property Wrap Up
Follow these five tips and you’ll be well on your way to seeing a big return on your investment.