As a professional property investor, one of the key metrics to analyse, and maximise, is the rental income you are receiving on your rental properties
You often don’t need to do a full renovation to boost your rental income. There are some small things you can do yourself that can make a big difference.
Here are ten top tips to maximising the potential rental income on any property:
1. Check out the competition
Conduct some research into how much similar properties in your area are renting for, and the standard and features of these properties. Are they modernised and up-to-date? Do they have new furniture included, white-goods, new carpet or fittings, a balcony, a garage, and internal laundry? If you want to increase your rent it’s important to be realistic around what similar properties in the area are renting for – and how yours stacks up in comparison.
2. Don’t over-capitalise
Before improving or renovating any property – do your numbers around what impact these modifications will make to your rental yield. It’s easy to become emotionally connected to a property, and over-capitalise on expensive updates, which can be over-capitalising based on the increase in rent received. Consider what difference any update will make to your return to be sure the expense is justified.
3. Consider what features will add the most value
If you are renting a 5 bedroom house with garden to a number of individuals, air-conditioning or a clean paint-job may be more attractive to tenants than re-designing the garden. Replacing old ugly vinyl flooring with a clean and simple new floor covering, may improve the feel and value more than replacing the gutters or spending a lot more renovating the bathroom.
4. Give it a lick of paint
Interior painting is the most effective way to improve the look and feel of a rental property. Tenants place a real premium on cleanliness, and nothing looks and feels better than a fresh coat of paint to potential tenants. Adding a splash of colour or feature wall (nothing too outlandish of course), can add value too, as potential tenants may better remember the property, especially if the colour scheme works with the internal features and fittings of the property.
5. Keep it simple
When it comes to colour schemes and styles inside – keep it simple – neutral colours and whites are generally the best way to go –rather than a hotch-potch of colour. When it comes to paint, fittings and furnishings – clean and bright are more appealing and look ‘cleaner’ than dark or varied colour – as well as making the property seem more light and spacious.
6. Fix the little things
Loose door handles, fittings or floorboards can make a bad impression. Make sure the small things are checked and work well. This is a sign to tenants of a well-maintained, caring and conscious landlord. Clean and fresh light-shades, all lights working, updated washers so that no taps are dripping, tidy up any mess, and start any tenancy with everything fresh, clean and working 100%. This is really important, because if you start with a fresh and clean property for tenants, they are far more likely to look after it, and it is easier to notice any damage that may have been done when they leave.
7. Freshen up the kitchen
You don’t necessarily need to renovate. Products like tile paint, laminate paint, benchtop resurfacing kits and faux stone benchtops can work wonders without the inconvenience and expense of a full kitchen renovation. If you have timber cupboards, you can repaint them, or even just change the cupboard fronts without the hassle and expense of new cupboards.
8. Update the bathroom
Old bathrooms from the 60’s and 70’s can have multiple colour combinations that looked great back in the day, but are now more-often seen as hideous. Tile paint can really update the colour palette for a fraction of the price of new tiles.
9. Tidy up the garden
Arriving at a property with a tidy garden is often the first impression a potential tenant will get of a property. Rather than spending thousands on re-designing a garden, your money may well be better used inside with important features such as dishwashers or air-conditioning – but being sure the garden is well-kept and tidy is very important when it comes to being appealing and looking like a well organised property. The street appeal can’t be ignored. A simple but economical set of garden furniture, can increase the perceived living space of a property, and open up ideas of how that area could be enjoyed – which tenants love. Having an appealing and usable outdoor space is a real bonus for potential renters.
10. Throw in some extras
Make potential tenants aware of the cleaning and maintenance schedules. If they know the entrances and stairs are being mopped or vacuumed every fortnight, or the fire alarms have just been tested and updated, these little things can help give a potential tenant genuine comfort around how well organised and considered you and the property are.
The peace of mind that comes with good presentation and consideration of your tenants’ comfort, along with a big smile and good energy, can make the world of difference when it comes to optimising your rental income
This approach also encourages the best response from your tenants, in terms of your tenants respecting and looking after your property, and in working efficiently with you if they want to leave.
Go get some local insight and make sure you get it right
Don’t just guess what local people will like, enjoy or expect in a rental property.
Even worse, don’t assume everyone is like you in terms of what they expect.