Rental homeowners will come to a point where their properties need repairs or renovations. However, with high materials costs and a limited supply of materials, landlords may find it difficult to create and stick to a budget for a renovation. Luckily, there are several improvements you can make to your rental that won’t break the bank and add value to your property. If you want to learn how to renovate on a budget, just keep reading.
What Is Causing Prices to Continue Rising?
Prices have been rising for most of the year–and they’re not slowing down. For example, building costs have increased around 31% since 2020. Inflation has caused most goods and services to rise tremendously. In fact, people who own rental homes now spend more on renovations than those who made major repairs pre-pandemic.
Even a simple painting project will cost more this year than last year. This puts investors in an uncomfortable position since upgrades can increase the value of your rental–even if they’re expensive to complete in the first place.
Luckily, there are ways for rental property owners to create a budget and complete cost-effective renovations. If you’re wondering how to renovate on a budget, keep reading as we go over some tips and suggestions for making rental property improvements.
Making Rental Home Improvements: How to Renovate on a Budget
Before making plans to renovate your rental property, ask yourself why you’re doing it in the first place. Are the repairs or renovations necessary? How can you avoid spending too much on renovations? If you want to know how to renovate on a budget, here are some tips to keep in mind.
- What to Repair vs. What to Replace
- Keep Renovations Simple
- Which Renovations Result in the Greatest ROI?
What to Repair vs. What to Replace
Decide what needs replacing or renovating and what could be repaired instead to keep costs down. Chances are, not everything in your rental will need renovations. Instead, you can save costs by repairing appliances, flooring, and other parts of your rental home. However, if something needs significant repairs or upgrades, don’t skip out on making necessary renovations.
Keep Renovations Simple
To avoid spending unnecessary money on home renovations, keep it simple. If it doesn’t need to be replaced or repaired, then think twice about renovating it. If something needs to be replaced, shop around and find the best deal before purchasing materials. Remember, upgrades don’t have to be extravagant. After all, you’re working on your investment property, not your personal home.
Which Renovations Result in the Greatest ROI?
If your rental home needs some revamping, it’s best to choose renovations that will give you the best return on investment. If it can increase the value of your rental property, then it’s likely a smart decision to make the renovation. After all, if you’re spending the time and money on renovations, you’ll want to ensure you’re getting the most value for your money.
Budget-Friendly Renovation Ideas That Add Value
As stated above, it’s best to choose renovations that will increase the value of your property. Remember, your goal is to earn income from your property by offering competitive rental rates. Here are a few simple solutions if you want to know how to add value to your rental property with renovations.
- Fresh Paint
- Upgrade Flooring
- Landscaping
- Add New Lighting
- Kitchen Updates
Fresh Paint
Walls can take a beating in a rental property. When you have tenants in and out of your rentals, the walls can show a lot of wear and tear. So, re-paint the walls a neutral color to give your rental property a fresh, new look. After all, paint can add significant value to your rental property.
Upgrade Flooring
Flooring is another part of your rental that will start to wear down quickly. Choosing sustainable flooring materials for your rental home that will hold up for a few years is best. Carpet generally isn’t the best choice since it can easily be stained, ripped, and damaged. On the other hand, laminate, hardwood, or tile is durable and adds value.
Landscaping
Another improvement that adds significant value is landscaping. After all, first impressions mean a lot to prospective renters. If the exterior of your rental property isn’t very inviting, consider making minor improvements to boost curb appeal. Some low-cost options to improve curb appeal include planting flowers around the property, painting or replacing the front door, or adding an appealing outdoor patio for tenants to enjoy.
Add New Lighting
Lighting can change the whole mood and appearance of a rental property. If the lighting isn’t so great or you have old bulbs that don’t do your property justice, consider adding new lighting fixtures. Instead of dim, yellow lighting, use newer LED bulbs that increase energy efficiency.
Kitchen Updates
Although initially quite costly, kitchen updates can add a ton of value. Whether you want to make small upgrades or renovate the entire area, kitchen updates will significantly increase the value of your property. Some things that people look for in a kitchen are storage solutions, newer appliances, and durable countertops.
Tips for Setting and Sticking to a Renovation Budget
If you want to set and stick to a budget for your rental renovations, it’s important to go in with a plan. After all, costs can add up quickly if you just start renovating and making significant upgrades to your rental property. If you want to renovate on a budget, here are some tips to keep in mind.
- Prioritize Needs- To stay within your budget, make sure to prioritize renovation needs vs. wants. In other words, if it’s not broken, don’t fix it. Instead, stick to simple, low-cost renovations for your rental home. After all, you’re not making improvements to your home; you’re adding value to your investment property.
- Create a Remodeling Plan- Next, go into your renovation with a plan. You don’t want to start your renovation without a goal in mind. Instead, plan out which renovations are required, what can be repaired, and what areas of your home you don’t need to focus on. Otherwise, you could end up spending more money than you bargained for.
- Check Prices Everywhere- You don’t want to overpay for materials or labor for your renovation. Instead, check the prices of materials at several stores before buying anything for your rental property.
- Estimate Renovation Costs- Before making improvements, estimate how much they will cost. Once you’ve reviewed your plan and price checks, you can estimate costs more effectively. Then, once you have a realistic estimate of how much it will cost and a budget in mind, try your best to stick to it.
- Complete Renovations Yourself- If possible, consider completing some renovations yourself. Although some investors don’t have the time to put hours of work into their properties, completing repairs yourself can save some money. Otherwise, you can count on your property managers in Northern Virginia to find the best contractors for your rental.
Keep Your Rental Maintained with Property Management
After learning how to renovate on a budget, investors should take time to plan out major renovations and property repairs. That said, if you’re putting time, money, and effort into renovating your rental property, you’ll want to ensure it’s maintained.
Hiring property management is one of the best ways to ensure your rental property is managed and maintained. Bay Property Management Group offers comprehensive rental management services to ensure you get your best ROI. We offer services such as tenant screening, maintenance, rent collection, and more.
Contact BMG today if you need rental management services in Baltimore, Philadelphia, Northern Virginia, or Washington DC.