Converting your home into a rental property makes sense for one or more reasons. Maybe the children have all moved out and you have started the next phase of your life as an empty nester. Perhaps you inherited a home that you want to keep, but not live in any longer. Finally, the most frequently cited reason for converting your home into a rental property is to generate supplemental or passiv income.
The decision to convert your home into a rental property does not magically make your house appealing to potential renters. You have to take steps to make your house attractive to attract the attention of prospective tenants. But there is a fine balance: you do not want to spend more on renovation than necessary, as this is now a business investment.
Smart renovation for rental property isn’t based on what you like personally, it should be based on practical improvements that will pay off and stand up to the wear and tear by tenants. Here are tips on what to renovate and where to save your money.
Investing in a kitchen renovation can pay off when you show your home as a rental property. You might not have to spend much money to buy new cabinets, as sanding and painting the surfaces can enhance the visual appeal of the kitchen.
Change out old appliances for newer appliances, and make sure the design of the new appliances matches the design of the appliances you plan to keep. Add a backsplash such as glass tiles to make the kitchen sparkle. If you have the finances, building a new countertop that is the focal point of the kitchen should appeal to potential tenants.
A bathroom that presents a contemporary design appeals to many renters. Some of the simple projects to complete include replacing the faucet and toilet seat, as well as the towel racks and shower curtain.
You also can upgrade the cabinet hardware and change out the old shower head for a more attractive new shower head. If one of the bathrooms is small, you should consider converting the bathtub into a walk-in shower and installing shelves to maximize the available space.
Let There Be Lights
First impressions matter when showing your home to tenant prospects. The level of illumination in your home can be the deciding factor for a possible renter, with special attention paid to the dining and living rooms. Artificial light sources increase the level of illumination in your house, but you also should invest in skylights to welcome the glow of the sun into your home.
Installing skylights increases natural illumination, which delivers benefits such as an enhanced ambiance, as well as improved mental health. Because they are installed at roof level, skylights provide tenants with privacy and an effective way to lower monthly energy bills.
Increase in Curb Appeal
The first impression for most prospective renters is what the outside of your home looks like. From the condition of the lawn to the appearance of the front door, curb appeal matters to a vast majority of tenants. You can plant new grass, overseed the bare areas of the lawn, and add a small garden in a location that is easily visible from the street.
Prune trees and shrubs, as well as install a few planters in front of your home. If you have the funds, consider adding an outdoor living space in the back yard such as a gazebo or pavilion. Most renters love having a place to entertain guests outdoors.
Install New Flooring
Nothing makes a house appear more outdated than visually unappealing floors. From antiquated designs to ugly scuff marks, the condition of the flowing in your home tells a prospective renter a lot about the rest of the house. A recently released study discovered that hardwood is the most popular type of floor for tenants.
You can mix it up a bit by installing hardwood floors in the bedrooms, while installing carpeting in the highest traffic areas like the entertainment room. Installing new flooring should be towards the end of your home improvement project list.
Provide Popular Amenities
Look at amenities not as deal-breakers, but instead, as dealmakers. Replacing an obsolete washer and dryer with machines that possess the most advanced technology can make your home stand out. Providing parking in a garage or off-street such as a carport or driveway helps attract tenants.
Central air conditioning is a big hit among renters because it distributes an even flow of cool air during the warmest months of the year. Create more storage space, especially if you do not have a basement or the basement does offer sufficient storage space.
Pet owners have a difficult time finding a rental property that allows pets or that places restrictions on pet size and breed. Installing a fence surrounding your property and allowing a dog to move in with a tenant is the ultimate deal maker.
Obtain the Proper Permits
Many cities require property owners to acquire a permit to operate a rental property. Remember to check with the city where you live to learn what permits apply to your vision of turning your home into a rental property.
The purpose of one type of permit involves safety. Before you can rent out your house, a city safety inspector must conduct an inspection to confirm the safety of the electrical and HVAC systems, as well as verify that there are enough exits for residents to use in case of an emergency.
City permits do not cost you much, but not having the proper permits can lead to costly fines.