A big thank you to Natalie from Home Owner Bliss for writing this article! Make sure to check out her blog!
Home improvements to your rental property run the gamut from minor cosmetic tweaks to major endeavors. You have general aesthetic upgrades (such as painting and replacing the hardware on kitchen cabinets) and more extensive remodeling projects like renovating a kitchen or adding a home addition. Some you can do on your own, while others require an expert with a license and a portfolio of completed projects. To help you determine which path to take, check out the following tips from JXI Real Estate Resources.
Regardless of who does them, your spruce up can make a positive impact on attracting tenants, and even on your property’s value if you decide to put this home on the market. Simple things like a fresh lick of paint or tidied up landscaping can even make a difference when determining new rental rates.
Paying for Home Improvements
Whether you choose to go big or small, the fact of the matter is that home repairs, renovations, and improvements cost money. Because of this, you might need to get inventive with how to cover costs. Savings is one option, as is using your credit cards. But there may be a better way.
If you have equity in your property, one option is to do a cash-out refinance. If you’re not already familiar with the term, a cash-out refinance essentially replaces your current loan with a similar product at a higher balance. If you refinance a $100,000 balance for $130,000, you take a $30,000 difference in cash to use toward home improvements. This guide from Rocket Mortgage walks you through the process of refinancing an investment property.
Any time you fundamentally change the layout of your property, you need a professional. The two areas this applies to most are the kitchen and bathroom. A full kitchen remodel will not only amp up the wow factor of your rental, but it also provides an impressive return on your investment. The same logic applies to the bathroom, and turning a small bathroom into a more open space with a universal design is a huge step toward making your rental more accessible. It’s also a smart move if you ever plan to occupy the property to age in place. In addition to these two rooms, if you plan to add to the footprint of the property or upgrade a major system — HVAC, plumbing, electrical — call a licensed professional.
When you are budget-minded, never fear. There are still plenty of projects that will allow you to get your tools out of the garage. A few of these include:
Everything you do to your home will improve its value, providing that it’s done right. Small projects, like painting and landscaping, make sense to learn on your own. But anything more in-depth, and you are better off looking for a remodeling company that can get it done right the first time.
If you find yourself feeling lost with a new investment property, take heart; JXI Rental Resources can help. From investment coaching to online investment courses, you can make sure your real estate investment plans are a success. Get in touch today!
It all started in the fall of 1991, on the day I was born…
Ok, ok, maybe I don’t have to go all the way back to the very beginning, but my passion for investing in real estate did start at a very young age. It was my parents, who had invested in real estate (by complete fluke mind you), that first introduced the idea of purchasing a home and renting it out so that there was no cost to the owner other than the initial purchase investment.
Well fast-forward to my early 20s and that idea was still in the back of my mind. I had not myself invested in real estate yet and my parents had swapped their rentals for a cottage (not a bad trade…), but I knew that this was something I wanted to try.
I read books and listened to podcasts, but the more I did so, the more I got discouraged. You see, a lot of the resources I was referring to were based on markets that were quite different from my own and the information they provided was not compatible with the properties that were available around me.
After some months of hemming and hawing, I finally decided to just do it. My wife and I purchased a cute (or so we thought) single family home down the road from where we lived. The plan was to keep the house pretty much as is and to rent it out, but it turns out we had been pretty desperate to finally buy a house and we felt we had overpaid for this one. The solution? To completely gut it and add an extra unit in the basement so that we could make more rent to offset the high purchase price (logical right?)
So there I was on possession day equipped with my trusty hammer we received for our wedding shower and my old drill that didn’t keep its charge along with my team; my father, my father-in-law and my 6 month pregnant wife, how could we not succeed!?
Well it turns out despite many hard learned lessons and a renovation project that never seemed to end, things actually did go quite well. We turned that single family home which originally had 3 bedrooms (ON 3 DIFFERENT FLOORS!) into a multi-unit home which had a 3 bedroom unit on the top 2 floors and a 1 bedroom unit in the basement. To this day it is one of my best cash flowing investments.
That project was enough to turn that idea that had been in my mind into a full fledged passion and so began my journey into the world of real estate investing…
What do you think? Was I crazy to take on a large project like that as my first rental? Would you be ready to do the same? Let me know in the comments! 👇👇👇