You’ve purchased your investment property and now it’s time to fix it up. You know that you want the best renters and think that if you make huge improvements to the property you can attract the best tenants. Maybe. Maybe not. Over improving your property doesn’t guaranty the best tenants, but it does guaranty that you will be making costly upgrades that may just end up being abused by any not so great tenant you do get.
So how much should you improve? First, look at the area where the property is located. If it’s in an area where you could lease it out as an executive rental, then make updates that would appeal to that type of tenant. This class of people are used to high end updates and touches and will care for them accordingly. However, if your property is in any other kind of neighborhood, going high end probably isn’t your best bet. Another part of location to be considered is the topography of the area and things like fires and floods. Just looking at the news from the East and West proves that some updates may be better than others when it comes to natural disasters.
Along with that, what kind of people are going to likely be renting your property? Singles? Couples? College kids? Families with young children? All great kinds of people and you may find that the college kids are kinder to your property than a couple or single. Or you may find they are worse than the kids in “Animal House”! Families with young kids are always going to be harder on properties. Not because they are necessarily messier or worse tenants, but because the nature of small children.
The basic question you should ask yourself is “is it nice enough that I would be comfortable with my family member living here, or does it need a bit more?” For most people, that would be a good barometer of how much to improve. Otherwise, you’ll be tearing out that expensive tile, ripping up the top of the line kitchen and bath fixtures and replacing them when disaster tenant moves out. Money down the drain!