Rental properties can be a great source of both income and long-term growth. With a stable tenant, you can make hundreds to thousands of dollars in profit every month. With 10 years of growth or more (in a good neighborhood), you can eventually sell the home for far more than you paid for it.
But these monetary advantages are both contingent on an important factor: your ability to keep the property in good condition. If the home deteriorates, it’s going to lose value – which means you’ll have a harder time keeping it occupied and you’ll be forced to sell it for a lower price.
So what steps should you take to keep investment property in good condition?
Find the Right Tenants
Your first job is finding the right tenants. There’s never a guarantee that your tenant will take good care of your property. And some of your tenants may absolutely trash your property. But you can minimize your risk and maximize your potential returns by screening your tenants carefully. If you choose to accept tenants with a good credit score, a clean background, and a suitable deposit, you’ll have a much higher chance of finding the property in good condition when they leave.
Additionally, the right tenant will stick around for a longer period of time, resulting in less turnaround – and steadier cash flow for you as the investor.
Conduct Property Maintenance
You also need to conduct property maintenance on a regular basis. Taking care of your property means identifying potential issues early, before they get any worse, and eliminating them.
- Inspection. A few times a year, you should do a walk-through of the property. Look for anything that might indicate damage or future damage; for example, are there any damp spots, cracks, malfunctioning equipment, or other causes for concern?
- Landscaping. Caring for your landscaping on a periodic basis will keep you from facing big problems down the road. Keep your trees and bushes trimmed, prevent weeds from getting out of control, and introduce new species that have a good chance to thrive.
- Gutters. Too many homeowners forget to clean out their gutters. One clean sweep will greatly reduce your risk of greater complications.
- HVAC. Your property’s heating and cooling system are vital – and there are many ways it can sustain damage. Oftentimes, a twice-annual inspection and cleaning are all it takes to keep it running in good condition. Swap out the filters, clean the ducts, and see if anything needs to be replaced.
- Plumbing. Plumbing systems benefit from similarly regular inspections. It’s also important to spend time winterizing the home if you live in a cold area; a frozen or burst pipe can wreak untold havoc on your home.
- Chimney. If the property has a fireplace or chimney, you’ll need to inspect it regularly. Get it cleaned and check for any damage that might interfere with its use.
- Safety measures. Periodically, it’s also important to check the safety features of the home. For starters, are your carbon monoxide and smoke detectors still working properly? Do you need to change out the batteries?
Clean and Paint
Whenever a tenant moves out, you’ll have the opportunity to visit the property and make some changes. Ideally, you’ll use this time to clean and paint. Deep cleaning of the home will remove unwanted dirt and debris. It may not restore your property to the pristine condition it was in before you rented it out, but it will help mitigate the damage. Additionally, a fresh coat of paint will instantly brighten the property, making it look new; it may also serve as a protective layer.
Finally, consider upgrading the property. Depending on the upgrades you choose, you could simultaneously earn more rental income, increase the home’s resale value, and make your life easier – all at the same time. For example, replacing the carpeted floors with a durable, hardwood floor can make it much more resilient to damage and increase the value of your property significantly. Renovating the kitchen can be enormously appealing to new tenants while reducing the potential for further damage and, of course, increasing your selling price.
Just be sure to do your research before committing to any purchases or work here; not all renovations or upgrades are worth the money.
Committing to Your Property
If you commit to taking good care of your property, you’ll already be in a better position than most property owners. With a handful of periodic reviews and upgrades, you can put yourself in a much better position. A better-maintained property will ultimately attract better tenants, allow you to charge more rent, help you sell for a higher price, and perhaps most importantly, grant you peace of mind.