When you’re focused on improving your investment properties, it’s important to distinguish between upgrades that yield a healthy return on investment and those that fall flat. A major pitfall and one of the common mistakes rental property owners can make is spending on upgrades that do not add much value or do little to enhance the appeal of the rental home to renters.
Being aware of upgrades to avoid allows you to make more smarter investment decisions regarding future property improvements. Most real estate professionals identify three main upgrades to steer clear of: elaborate landscaping, the installation of hardwood flooring, and extensive smart technology features.
Don’t waste money on elaborate landscaping
A yard with low-maintenance landscaping is a practical feature for a rental home. Many tenants prefer something manageable. Upgrading your rental property’s landscaping with layers of colorful plants and trees, decorative shrubs, and a large, lush lawn might appear to be a valuable addition. After all, curb appeal plays a major role in the value of a rental home.
However, investing in a high-maintenance yard is often wasteful, since it typically doesn’t add much to the property value and may not increase renter’s satisfaction. A tenant might appreciate beautiful landscaping at first glance but later decide it’s too much to maintain, leading them to neglect your property or even move out. For landscaping a rental property, it’s wise to remember that simple is better.
No need for expensive hardwood flooring
While wood flooring is highly regarded by homeowners for its natural style and warmth, it requires a lot of upkeep and is prone to damage from things like water leaks and wear and tear. Renters may also not be prepared to adequately care for a hardwood floor.
Although wood flooring may be a desirable upgrade, many renters are happy with low-maintenance look-alike options. Since natural hardwood is one of the more expensive upgrades, you might not recover the installation cost, even with rent increases.
Keep smart tech installations to a minimum
To attract tenants and remain competitive, many property managers and landlords consider installing advanced technology like smart thermostats, keyless entry systems, or energy-efficient appliances.
Still, property owners must assess the cost versus benefit. Even if technologies offer convenience and efficiency, their significant price tag may not be offset by a solid return on investment.
Such home systems involve initial setup, and their ongoing maintenance costs can stack up. While advanced security features might sound appealing, they often don’t significantly affect rental rates or greatly influence tenant satisfaction. As technologies quickly become outdated, they may require costly upgrades, and technical problems may lead to technical issues that need specialized expertise, which increases operational costs. These factors should be considered before you integrate new technology into your property.
Evaluate cost vs benefit before renovations
To enhance profitability and tenant satisfaction, it’s best to focus on practical improvements. Though fancy cosmetic changes and complex technology installations may be tempting, they’re not always the best investment. Instead, pursue cost-effective upgrades such as essential maintenance and improvements that improve the property’s functionality and longevity.
Looking to take full advantage of your investment property returns in Lancaster and its vicinity? Real Property Management Traditions is the only place to look! We’re always here to help you achieve your objectives – give us a call at 661-266-1400 or send us a message online.
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