Owning an investment home is more than just finding and managing renters. You also need to keep your home competitive with similarly priced homes in your area and manage its long-term value. If other properties in your price range feature upgrades that yours doesn’t, you’ll be at a competitive disadvantage, both in the market for prospective buyers and in the real estate market if you decide to list the home.
If you’re facing this situation, the best way forward is investing back into your home by completing remodeling projects with a strong return on investment (ROI). These are renovations that will ultimately net you most of your investment back when you sell, while making your home more attractive and competitive in the interim.
Next to kitchens, master bathroom remodels are one of the best projects from a ROI perspective. By upgrading the shower, floors, vanity, sinks, toilets, and more, you can make your home much more desirable while also re-investing in its long-term value.
Any bathroom remodel, regardless of how ambitious it is, will involve some degree of plumbing work. Always hire a licensed plumbing professional to help with this type of work. While there are aspects of a bathroom remodel, such as laying tile or vinyl flooring, that invite a DIY approach, plumbing and pipe installation is best left to an experienced hand. When it comes to remodeling the bathroom of a home, you reap what you sow: today’s decision to cut corners and hire an unqualified plumber to finish up the shower could come back to bite you a year from now when your renter reports a major leak.
When it comes to home remodeling projects, the kitchen is king. Everyone loves an upgraded, renovated kitchen: renters, homebuyers, and realtors. By remodeling your kitchen and adding new countertops, cabinets, flooring, and appliances, you can add significant long-term value to your home. Your new kitchen will appeal to long-term renters looking for high-quality features and practical, quality-of-life upgrades.
Your first step should be talking to a professional remodeling contractor. Any experienced contractor will help with more than just the labor and installation: they’ll also help you plan your project, procure materials, and figure out what you can accomplish with your budget. They’re your guide for the project, and they can make your life a whole lot less stressful.
To maximize your ROI on any home remodeling project, the key is adding value without increasing costs. While you don’t want to sink too cheap on materials or contractors—hiring inexperienced plumbers, for instance, is a common regret for many home managers—you do want to find places where you can save money. This may involve limiting the scope of the project—such as remodeling the kitchen, but leaving the layout intact—or working with your connections to get good deals. Here, too, your contractor might be helpful, as they may have access to special contractor-only pricing on countertops and cabinets.
For obvious reasons, you’d only tackle these on an as-needed basis, but some of the best projects for ROI, statistically, are those that involve repairing and replacing essential aspects of the home. In many cases, if your home’s roof, air conditioner, or garage door needs to be replaced, you may have difficulty renting or selling the home, anyway. That makes these upgrades imperative:
- Garage Door Replacement
- HVAC System Replacement
- Window Replacement
- Roof Replacement
- Siding Replacement
- Wood Deck Replacement
Reinvest in your home’s value and reap the rewards
If you’ve been saving some of your rental income for upgrades, now’s the perfect time to start planning out your next project. Talk to an experienced contractor in your area and start getting ideas, quotes, and more.
On the hunt for even more project inspiration? Be sure to take a look at this infographic. It has a complete ROI breakdown of the rental upgrade projects discussed above, along with several others.