I want to buy a property to rent out. I am curious in what ways can I fix/upgrade a home to increase the asking rent price? What about upgrades that will increase the homes resale value? (Adding a room, different upgrades, etc.)
It depends on the condition of the property. When you are buying a rental that needs updating, you want to make sure you don't over improve it. Make sure what you are doing will get you your money back. Look at higher end rentals in your area and see what they look like. Keep in mind it is more than the finishes that determine the price.
Where are you wanting to purchase? Driving maximum rent is usually tied to condition and location, but there are other factors...like the current market. If you're wanting to move into a completely different rental category by say...adding room(s) that's a whole different undertaking.
Hi @Clara Brashear , I agree completely with @Theresa Harris the best way to start making this decision is to look at the other higher end rentals in the market and see what they do/have that your units do not. It really all depends on your market and what it prefers. For example, some markets may prefer carpet in the living room, while other prefer LVP. Some may allow for an in-unit washer/dryer to increase rents, others my be indifferent. It really all depends on what the higher end comps in your market say. And if there are no higher end comps, perhaps your market does not support higher rents.
If you are struggling to find higher end comps, contact a local real estate agent and they should be able to help you out without a problem. Good luck!
I own 9 rentals and the secret is all cost control. Like others above have mentioned do not over rehab or spend too much. I have seen too many rental owners go in and dump money into a property to get an additional $25-$45 more a month. Most of the time tt doesn't make sense to spend $10k to get $25 more a month. You have to look at the cost and benefit to see if it is worth spending the money.
As other have said look at other rentals in your area. Do they have have laminate countertop? If so probably not worth spending the money on granite etc. Do they have LVP instead of tile, probably best to stick with LVP.
There is a reason some people call lower cost materials rental grade. Keep the costs down, don't over spend.
@Matthew Nicklin Great advice. Consider the market and adjust accordingly. While upgrades certainly give you more curb appeal and a potential advantage over the competition you need to ensure you are not putting too much into a home.