Contrary to what some may think, it is easy to improve the value of rental properties with a DIY project. And while it is an upfront investment you may hate to part with, the higher monthly rent and asset value of the home makes it a worthwhile investment—if you choose suitable projects.
To ensure you don’t invest your valuable time and money in things with a low rate of return, here are the DIY projects that get the most out of your rental properties.
PROJECT #1: Open up the rooms.
If you’ve ever watched those remodel shows on HGTV, you know that one of the most common tasks is to open up space. Sometimes this means knocking down non-structural walls. It can also mean taking out the kitchen island or built-in bookshelves.
Fifty years ago, people liked having lots of small rooms. The living room, sitting room, and dining room would each be walled off. You didn’t see many lofts, as every inch of space upstairs was used for either a bedroom or bathroom.
These days, our tastes and needs have changed. For example, tenants want open spaces and are willing to pay more for them! Check out most newer homes, and you’ll see this trend isn’t going away anytime soon.
PROJECT #2: Boost curb appeal with landscaping.
When prospects drive to your home, the first impression may make or break their decision. Even if the inside of the house is immaculate, an unkempt or crowded yard isn’t something they want to see.
The good thing is that improving landscaping isn’t very difficult. It’s probably the easiest thing to do yourself, plus it has a high rate of return. Some experts will tell you the ROI can exceed 400%! Not bad—especially if it lets you charge higher monthly rent.
PROJECT #3: Install new floors.
Let’s face it, floors take a beating. Whether you have kids or pets, your floors are likely much dirtier than you think!
Installing new flooring doesn’t have to be expensive, but it can make a huge difference. The ROI for new floors is usually at least 50%, if not over 100%. In addition, tenants feel better seeing new floors, knowing there’s no hidden dirt, grime, hair, or other nastiness stuck in the carpet!
And speaking of carpets, installing new floors allows you to get rid of carpet—at least some of it. The carpeting is excellent for wrestling with kids and pets, but most people prefer hardwood these days. Hardwood (or laminate) floors are easier to clean and are considered a luxury commodity compared to carpets. Plus, it’s very easy to install hardwood yourself. Most models easily click or slide into place, with no glue required.
You’re also at an advantage because most landlord horror stories involve carpets. So by removing that element altogether (at least in most of the home), you’ll save yourself a lot of headaches!
PROJECT #4: Update the bath.
Updating a bathroom is almost universally agreed upon as a great way to increase home value. It only takes a little to overhaul a bathroom—$500 might be all you need. But that $500 can make it feel completely different, meaning more money in your pocket from tenants.
Most projects in the bathroom are relatively straightforward, too. For example, cleaning grout, removing rust stains, installing a fan or a new shower head, and buying a new toilet seat can go a long way.
PROJECT #5: Paint!
Everyone has different tastes. Unfortunately, your tenants may have very different tastes than you or whoever owned the home before you bought it.
But instead of just waiting for “the right tenant,” it makes more sense to do some painting. Neutral colors always work well, especially off-white. A light brown or dark grey hue may be used, but remember, they’ll make the room feel darker, which most tenants don’t like.
The same goes for that hot pink room that used to belong to a little girl or the dinosaur wallpaper in the boys’ room. A little paint and sweat equity put into painting the walls and ceilings will improve the home value and increase the rent from tenants.
DIY Project Tips to Keep in Mind
Repairs, upgrades, and renovations are most cost-effective if you do them yourself. That is particularly true for first-time investors or those who own just one or two rental properties. Here are a few tips that will help with DIY projects for your rental properties.
⇒ Quality beats quantity.
When you need specific tools for a DIY project, don’t go with the cheapest you can find. A quality tool is one thing where it makes sense to pay a little more for something that lasts. Assuming you’ll take on similar projects with other properties, it only makes sense to invest in something you can use repeatedly.
⇒ Renovate between tenants.
Renovating a home while tenants are living there is a lose-lose situation. First, tenants get frustrated because you’re invading their privacy and causing a nuisance. Even if they aren’t home while you’re doing the work, they probably aren’t happy with the fact you’re there.
Plus, their stuff is only going to get in your way. For example, to paint the cabinets, you must move everything off the kitchen counters and put a drop cloth down. To plant flowers outside, you’ll need to get their kids’ toys off the yard. And bathroom upgrades (which have some of the highest returns of any DIY project) means fiddling around in one of the most private rooms of the house.
⇒ Renovate one room at a time.
While in-between tenants, it may be tempting to do a complete overhaul on the home. But instead of starting multiple projects, do one at a time. You’ll finish much faster, plus prospective tenants will be more likely to rent if they only see one room under construction when they visit the home.
Plus, it’s a lot less expensive! Laying hardwood throughout a whole house is a costly undertaking. Doing it for just the upstairs or those two rooms that needed it the most is much more manageable on your wallet and time.
⇒ Green is good.
Investing in green products for the home is a good investment both financially and socially. Not to mention they typically last longer than traditional units. Here are a few examples of what you can do:
- Install low-flush toilets
- Put water-saving shower heads on every shower
- Replace a tub with a shower (if you’re renovating the entire bathroom)
- Install solar panels (your tenants will love the lower energy bills)
- Put in efficient HVAC and water heating systems
Even though you may not directly benefit from some of these, your tenants will! Some will even be willing to pay more, knowing they’ll have lower bills and live in a greener home than the alternatives.
⇒ Stick to areas with high ROIs.
DIY landlords will often renovate anything they don’t like. While this is logical, it makes more sense from an ROI perspective to focus on specific areas of the home. The kitchen and bathrooms are the best rooms to work on, as your ROI is typically about 85%. Improving the flooring, as mentioned earlier, also has a great ROI of (usually) at least 70%.
There you have it—some of the best DIY projects and tips for landlords. We acknowledge that these activities aren’t always the most fun in the world, but they help you stay involved with the property, learn a few new skills, and save tens of thousands of dollars over time.