The reality with rental properties is that they depreciate over time and they age naturally which eventually starts to show the wear and tear due to continuous use. They need to be updated now and then. Dilapidated looking interiors and old furniture can make your investment properties look lower than their value and will start to generate lousy appeal, and this could mean you need to lower the rent to attract new residents. A well-maintained rental property not only ensures happy residents but will also give you the right to impose higher rents.
While you work on maintaining the property value and earn a respectable income thru rent each month,
It is just as important to choose the right timing to update your Bullhead City rental homes. As a general rule, you should consider replacing carpets, having the walls repainted, upgrade appliances, etc. once every couple of years. After you are done covering the basic updates, you then need to move on to the more extensive upgrades. You may have thought about adding granite countertops, two-tone paint, or hardwood flooring as some new upgrades to do in your property as they attract better residents and will add value to your property, but you also need to ask yourself if they are truly worth the cost.
When it comes to upgrading your rental property, there are both pros and cons to doing so. Matching the benefits and potential drawbacks can help make your decision of whether or not to upgrade a much easier one.
The Pros
According to what the trend is with renters, they are usually looking for rental homes with features and amenities that match their style and preference in their lifestyle. To draw these potential residents, adding modern kitchen appliances, bathroom fixtures, and other features to your Bullhead City rental home may be necessary.
Based on your market, after these renovations are complete, you should also be able to increase the rent on an upgraded rental home. Possible residents recognize that they will need to pay more for quality and are often willing to do so. Residents drawn to upgraded homes are more likely to take better care of them, enhancing the long-term profitability of your rental properties.
As a bonus, upgrades using quality materials can increase the overall value and extend the life of your rental properties. Higher quality materials tend to last longer, offering long-lasting value and return on your investment.
The Cons
Upgrades are all about value. The possibility of overspending on an upgrade is a top potential drawback because there is a likelihood that you won’t be able to recover the cost. Upgrades will demand cash to be spent at the beginning so once you decide to upgrade make sure you have sufficient cash flow to cover the cost that the renovation will take while waiting for the eventual return.
One other potential downside to upgrading your rental property is pricing yourself out of your market. If you want to upgrade to raise your rent, make sure you have already done your research. Do not just rate your property randomly. Study comparable properties in your area to determine whether your price point after upgrading is too high.
Lastly, it’s important to know that not all upgrades will increase the value or demand for your Bullhead City property. Taking the time to figure out what to upgrade and what to leave as-is can help you avoid this costly mistake.
In Conclusion
Unless you are confident that a retro-style rental house is what potential residents are looking for, having a plan to upgrade your rental homes may be part of a smart strategy to keep your rentals competitive.
For more information about the services offered by Real Property Management Northern Arizona, please contact us or give us a call directly at 928-757-7368.
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