“Oh, this house would look so good if we just…” This is a dangerous mentality for any homeowner, but completely disastrous as an investor. Updates can increase the functionality, aesthetics, and the value of a home, but not every update is necessary. Some renovations cost tens of thousands, and others are only a couple of hundred dollars. 

While costing you upfront, updates can be a great short and long-term investment. They can increase the property value, and they can also help you get and keep a good tenant in your property, paying you each and every month. 

The danger comes when your heart starts dictating what renovations get done instead of our brain. 


 

Good Renovations (Within Reason)

 

Kitchens

Many view the kitchen as the heart of the home. It generally has a good return on investment (ROI), but not every house needs a kitchen reno, and most don’t need a complete gut job.

Money and budgeting are important as an investor. You need to ensure that the numbers make sense, meaning your property can generate more money than it costs.

That being said, don’t be cheap. You’ve invested all of this money to buy the property, but there will be times when you have to reinvest into a property to maintain it and keep it nice. Sometimes renovations need to happen when you first buy the home, and sometimes they can wait a couple of years but then need to be addressed. Have a realistic renovation budget in place for the home. 

If your home doesn’t need renovations when you buy it, set money aside from each month’s rental income to go towards any future renovations that will come up.

Sometimes new cabinets are necessary, especially if the current layout of the kitchen isn’t practical. Other times, getting cabinets professionally painted can be a less expensive way to bring new life to a tired and dated kitchen. Neutral, timeless options for counters and backsplash are also smart choices. Avoid being trendy on big-ticket items. This isn’t your dream home, it’s an investment, so neutral and timeless are the way to go. You want to appeal to the masses.

Don’t waste your money on a chef’s kitchen with restaurant-quality appliances. Faucets and sinks greatly range in price. There are cool options out there, especially at specialty kitchen stores. Don’t get caught up in the fancy extras. Practical and nice are key. You don’t need to go with base models, but you don’t need to go over the top either.

Bathrooms

Like the kitchen, people care about bathrooms. They want them to feel clean and relaxing. An avocado green sink and tub are hard sells to tenants. Sometimes a bathroom just needs a new vanity, toilet, or a coat of paint, but a lot of older homes need a complete facelift. 

These renos can be expensive, but they can also be necessary, and once started they can end up costing much more than expected so be prepared.

Unless you’re building a luxury home, there aren’t a lot of features your bathrooms actually needs. Keep it simple. A new bathtub can be a good investment in starter family homes. However, a luxury soaker tub isn’t needed and isn’t going to be a good ROI.

A new shower head is a simple, inexpensive update that can dress up a bathroom. Converting the shower into a steam shower, not needed. 

Good ventilation may not be flashy and easily noticeable but is important to help prevent mold and mildew. It can save you time and money in the long run. 

Again, as with anything, look for good and practical. It doesn’t need to be high-tech.

Curb Appeal

First impressions can make or break, so be sure your investment property looks pleasing to tenants. This can mean a fresh coat of paint on the shutters, front door, and garage door. It could mean updating the house numbers to something fresh and visible. Speaking of garage doors, make sure it’s in good working order.

Adding a low-maintenance garden can cost a couple of hundred dollars but really make an impact when you first see the house. Avoid making the garden too large. It may look nice, but it can also look like a lot of work not everyone will want to maintain.

If the driveway is cracked and in rough shape, have it refinished. As long as it looks fresh and in good shape, that’s sufficient. Expensive poured and stamped concrete are unnecessary.

Since we’re talking about outside, let’s discuss what’s worth tackling out back.


 

Like the front yard, don’t add extensive and elaborate gardens. They may look beautiful but when many people look at them, they see work. It can take a lot of effort to keep a large garden looking good. Most people don’t want to put in that time, and as a landlord, you don’t want a neglected garden.

One thing you may want to add or update is a deck. A back patio/deck can turn the backyard into an outdoor living space that your tenants can enjoy. However, don’t go overboard with this. Multi-tiered decks, pergolas, built-in fire pits may all look nice, but they’re unnecessary expenses.

Other Good Updates and Upgrades

You want your home to be fresh and inviting. A fresh coat of paint throughout the house can go a long way. Stick to neutral colours.

Floors can be another decent-sized expense depending on the numbers of rooms you’re doing. Updating tired carpet with nice laminate floors can transform a room making it feel inviting and new. If carpets are worn, it can make the whole room and house feel far more dated.

If the home has old hardwood floors, maybe you need to have them sanded and sealed. This can give your floors years of added life. If you have tiles that need replacing, stick to something easy to clean, and neutral. This is a long-term investment so go with good quality, timeless tile that will work for years to come. 

Avoid carpet. While flooring trends change, laminate and hardwood floors are preferred because they’re easier to clean and maintain. Again, like everything on this list, look for something nice and practical.

If you own an investment property and would like an honest assessment of what updates and reno’s you should consider for it, please reach out.

If you are thinking of becoming a real estate investor yourself, or you are already an investor and would like to leverage your current investment(s) into more properties, or you are looking to sell one or more of your investment properties, give me a call at 905-683-7800.  




I’ll be more than happy to answer any and all of your questions and help you with all your real estate investment needs.







 

Thanks For Reading Today’s BLOG!

Brian Kondo
Sales Representative / Team Leader
The Brian Kondo Real Estate Team
Re/Max Hallmark First Group Realty Ltd.
905-683-7800 office
905-426-7484 direct
brian@briankondo.com
www.BrianKondo.com
www.BrianKondoTeam.com

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