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Renovating your rental property is an important part of the buy and hold process. You want to create a solid and comfortable home for your tenant. However, it is possible to go overboard and implement too many upgrades.
Spending too much on a renovation will cut into your return on investment. The point is to have a high ROI, so you have to find a balance. On this episode of Investing in Real Estate, I’m sharing the three biggest ways investors waste money on a rental property renovation. Don’t miss this episode!
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This episode is inspired by my own mistakes. On my first few properties, I wanted to install all the bells and whistles—fancy thermostats, high quality countertops, hardwood floors. However, those upgrades are not necessary on a rental property. Tenants in a C class neighborhood will be happy with the basics.
The first place where investors try to over upgrade is in the kitchen, specifically the cabinets. A rental property does not need custom cabinets made out of solid wood. We always install base grade cabinets in our rentals. They’re solid, they get the job done, and they look great!
And if one of our tenants is a little rough on the cabinets, it’s no big deal. We can simply replace the cabinets for a few hundred dollars. Remember, your rental properties are not luxury apartments.
In the same realm, many investors think they need the best countertops on the market. This is not the case. Your rental needs something durable and affordable. Not granite! Formica looks convincing, and lasts for years.
On today’s episode, I’ll share the two other upgrades that are a waste of money on a rental property. I’ll also talk about purchasing water heaters and furnaces. These tips can save you a lot of money on your renovations; don’t miss episode 120 of Investing in Real Estate!
If you’re ready to begin building a passive income through rental real estate, book a FREE call with our team today. We’re ready to talk about your goals and want to help you learn more about earning legacy wealth for you and your family.
On this episode you’ll learn:
- Should you create a master suite in your rental property?
- What kind of flooring is best for a rental property bathroom?
- Where is the best place to find a water heater?
- Should you put carpet or hardwood floors in bedrooms?
- And much more about rental property renovations!