There’s a lot of money to be made in the rental property business. So what’s the most cost-effective way to bring home the rental bacon? Take a little advice from us.
Easy does it. We’ve heard it said like this: Treat your income property like a house rather than your own home. While it’s easy to want to choose the trendiest tile and the most expensive light fixtures to update your rental property, that’s the surest way to lose money rather than to make it. In order to rent a house, it needs to function properly. Cover the basics. If there’s money leftover and you’re looking to raise the price a hair to accommodate a higher-income renter, the time to make those decisions is at the end of your budgeting. Just be sure your structural renovations come before your cosmetic remodeling.
5-10 rule. Speaking of budgets…yes, you need one. This is the single most important thing you need before you get started on renovating a home for rent. It’s like the foundation of a home. If it’s solid, you’ll be good to go. The general rule-of-thumb is that you should spend no more than 5-10 percent of the total value of your home on renovations if you're looking to make money at the end of the day.
After the basics. You already know that your home needs to pass inspection. This will ensure the bones of your rental property are in good shape. Once you have those things checked off your list, the small things can go a long way. In many cases, you’ll be able to clean, refinish, and repaint rather than totally replace the old with the new. A fresh coat of paint and refinished flooring will go a long way. After that, touch it up with a grand finale of additions that will lure the right tenants like bathroom faucets or a step-above light fixture that serves as the centerpiece of the room. And don’t forget that the outside of the house serves as the face of your property. If you want to find good tenants, be sure to pressure wash the home or repaint it. Add a pop of color to the front door for a trendy look without breaking the bank, and be sure your landscaping is freshly manicured.
In case of emergency. Don’t forget to save. It’s easy to see all of the money coming in the door and think it’s all yours for the taking. But when you have an older property, there’s always a chance something could happen. Mother Nature has her way with homes too, especially when it comes time for hurricane season. So when your first few rental checks come in, tuck them away in a safe place and save them for a rainy (or hurricane-y) day so that you’ll be safe rather than sorry if and when you do need to make repairs.
Thinking of renovating your home, give us a call at 910.620.1835 today or fill out our brief renovations form and we'll be in touch soon.