Budget Friendly Renovations To Increase Rental Value
Smart renovations will not only increase the overall capital value of your property, but can also mean extra rental income. If you take care of tenants’ basic needs you will find more of them want to rent your property and will be prepared to pay a little extra to do so.
Here are a few tips to get your cash flow rolling.
It would be great to live in Fiji, where every day of the year has a temperature of between 25 and 29 degrees, but until then, we have to deal with Australia’s more diverse climate. In most parts of the country it can either be stinking hot, freezing cold, or an inconvenient mixture of both.
Air conditioning is one of the first things prospective tenants will ask for. In some cases they won’t even look at a place without it, so give them what they want. Smaller split system air conditioning can be installed for less than $1000, so you can expect to make the money back in extra rent relatively quickly.
If you don’t want to spend big on a brand new kitchen for your rental property, consider some of the things within it that could be desirable for tenants. By including a nice fridge and dishwasher, renters don’t have to worry about buying their own when they move in, or taking them with them when their lease ends. Less hassle equals more cash.
A standard fridge and dishwasher can be bought and installed for not much more than $1000 each. When you consider they each last up to 12 years on average, even a $10 a week rental increase would be well worth it.
Outside the kitchen, installing built-in wardrobes in bedrooms will add storage space, which is highly regarded by tenants, while throwing in an internet connection is also valuable in this age of working from home and binge watching streamed shows.
If the market is right, you could consider completely furnishing your property. This has been known to add value in CBD studio apartments where corporates from outside the city might need a simply styled, hassle free rental for a 6 or 12 month work project.
Want to feel good about helping the environment while also looking after your bank account? The good news is that Australia is basically one big solar panel. Not only that, but technical advancements made in the space mean the price of having solar power installed in your property, plus the ongoing costs have decreased significantly over the past decade.
For a nationwide average of just over $5000, including the federal government’s STC rebate (a financial incentive issued in the form of Small-scale Technology Certificates) you can have a 5kW solar panel system installed at your investment property.
An average Australian solar system will nowadays pay for itself in savings within 6 years, after which energy bills will no longer be a concern. Savings on energy mean tenants will be happier to pay more rent and reduce their green footprints in the process.
A bathroom facelift is a great bang for buck renovation for value adding, but if you don’t want to go the whole hog, there are a couple of other sneaky tricks. Got an existing wet area such as an internal laundry? Convert it so it also doubles as a second bathroom. This renovation can be tricky as the plumbing may need to be redone, but once you can say a property has two bathrooms, its rental and overall value will increase significantly.