When improving your investment properties, some renovations may deliver a promising return on investment, but others fall short. One of the most common mistakes rental property owners can make is pouring funds into upgrades that do not add much value or do little to boost the appeal of the rental home for future tenants.
Identifying which upgrades to avoid will help you make smarter investment decisions concerning property improvements. Most industry professionals agree that there are three upgrades to steer clear of: elaborate landscaping, the installation of hardwood flooring, and extensive smart technology features.
Don’t waste money on elaborate landscaping
Well-kept, low-maintenance landscaping is a sought-after feature for a rental home. The majority of renters appreciate a yard that’s simple and easy to handle. Upgrading your rental property’s landscaping with vibrant plants and trees, intricate flowerbeds, and a large, lush lawn may seem like a valuable addition. Since curb appeal influences the value of a rental home, it may seem worth the effort.
However, a high-maintenance yard often doesn’t add much to the property value or boost renter’s satisfaction. A tenant may initially admire the beautiful landscaping but soon view it as burdensome, potentially neglect your property or even move out. With landscaping a rental property, the rule of thumb is that simple is better.
No need for expensive hardwood flooring
Wood flooring is admired by many homeowners for its natural style and warmth. Yet, it requires a lot of upkeep and is prone to damage from water leaks or accidents. You should also evaluate whether renters will adequately care for a hardwood floor.
Although wood flooring may be a desirable upgrade, most renters are content with a low-maintenance look-alike option. Since natural hardwood is one of the more expensive upgrades, the odds of recovering the installation cost are slim—even if you raise the rent.
Keep smart tech installations to a minimum
In today’s rental market, property managers and landlords may be eager to equip units with advanced technology such as smart thermostats, keyless entry systems, and energy-efficient appliances to attract tenants and remain competitive.
Still, property owners must assess the cost versus benefit. These technologies provide convenience and efficiency, but they come with a significant price tag that often doesn’t lead to a strong return on investment.
Smart home systems require an initial setup and have ongoing maintenance costs that can erode profit margins. Advanced security features might offer peace of mind but don’t significantly affect rental rates or tenant satisfaction. Technologies that are cutting-edge today can become outdated tomorrow, requiring costly upgrades. Plus, technical issues may arise, demanding specialized expertise and raising operational costs. Think carefully before choosing to integrate new technology into your property.
Evaluate cost vs benefit before renovations
When it comes to upgrades, consider both profitability and tenant satisfaction. While fancy cosmetic changes and complex technology installations might be enticing, they may not represent the best investment. Instead, invest in cost-effective upgrades like essential maintenance and improvements that improve the property’s functionality and longevity.
Aiming to optimize the return on your investment properties in Kimberly and nearby? Your search ends with Real Property Management Magic Valley! Contact us at 208-734-4001 or send us a message online at any time and we will be delighted to assist you in achieving your goals.
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