RENOVATING YOUR INVESTMENT PROPERTY

 

Many investors underestimate the value of renovating their investment properties, not only can it lead to a much more generous rental return, decreased vacancy rates, but also one great tax benefit! But when thinking about renovating your investment property, you may ask “where do I start?”, “where do I stop?”, and even “how much more rent will I get?”

 

Well… “How long is a piece of string?”

 

When you are renovating your own home, the one you live in, you may splurge on some mosaic tiles for the bathroom, or even an integrated Nespresso machine for the kitchen! However, these can be unnecessary expenses for an investment property, and may actually have the opposite effect to what you were hoping!

 

The first step would definitely be to engage a Property Manager. Why? Because they will be the best person to: 

1. Help you understand what kind of tenant may be interested in your property. 
2. Advise you on what is important to these tenants when it comes to choosing a rental property. 
3. Recommend trustworthy tradespeople, to help get the job done. 
4. And a good property manager, may even help project manage for you, meaning you won't have to worry as much!

 

Whether you are doing it yourself, hiring tradespeople, getting a property manager to assist, or hiring a project manager, here are some key points to consider.

 

First and foremost, you may be tempted to do piece by piece, using the time in between tenancies to update different parts of the property. However, this can leave the property looking, and feeling, unfinished, so we suggest doing the whole property when possible.

 

When considering flooring, there are affordable, durable, yet still attractive options! For living spaces and thoroughfares, floating laminate floorboards will do the trick, they are affordable with some being less than $100 per square metre. In bedrooms, a low-pile carpet will help avoid major wear, and a darker colour will help prevent obvious stains, but don’t go too dark, because it will make the room look smaller. Finally for kitchens and bathrooms, the original tile will typically be fine as long as they are in good condition.

 

Lighting is also very important, my go-to suggestion, is to fit the property with new LED downlights. They are affordable, durable, and energy efficient, they will brighten up the property, without it being blinding. This way you can save yourself money, freshen up the property, and help save the environment!

 

The kitchen is the heart of the home, but it doesn’t have to cost you a fortune to update it! The kitchen may even be one of your cheaper improvements. Don’t fuss about with designer tapware, custom joinery, or european appliances, an ikea or bunnings setup, with some basic appliances will be more than sufficient. In fact, your cabinetry, might not even need to be replaced, maybe simply replace the handles and give the cabinet doors a lick of paint. One thing to bear in mind though when thinking about appliances, is a dishwasher, for many tenant’s it is a non-negotiable so if the opportunity to install one presents itself, we would definitely suggest installing one.

 

The bathroom doesn’t have to be an expensive ordeal either. Simply repainting in a neutral colour, and regrouting the tiles can make a huge difference. A new mirror & vanity can also freshen up the property, and if you want to go the extra mile, replace the shower curtain with a frameless glass screen. When painting the bathrooms, ensure you also use a mould retardant paint, this will save you a lot of pain in the future.

 

Finally a lick of paint throughout will make all the difference.

 

And last but most definitely not least, quite possibly the most overlooked aspect of investing further in an investment property, is the tax benefit! Be sure to call your Property Manager to arrange a tax depreciation schedule. Your investment in these assets and their depreciation in ‘value’ as assets over time can make a huge difference come tax time!

 

By taking the time and investing a little more into the property, you will have a much smoother experience, not only will the property likely lease for more, lease faster, and to better, long-term tenants. If you would like to learn more about what this might look like for you, get in touch with our Investment Property Specialist.