Which Amenities To Add (& Avoid) in Your Rental Property

As you know, rehab and maintenance of investment properties can be a costly endeavor in the world of real estate investment. Part of buying an investment property means spending money to add upgrades and amenities and make repairs as needed. If you’re crunching the numbers to figure out financing for an investment property, you have to consider what money needs to be spent on upgrades and amenities – and not only focus on repairs that are needed. Sometimes, adding amenities is unavoidable. In other cases, owners lose sight of the bigger picture and add unnecessary amenities because they think it’ll add value. 

However, when choosing what amenities for rental properties, owners need to look at neighborhood standards first and consider their overall price point. 

• For example, if you’ve got a property in a neighborhood where rents are between $2,000 or even $3,000 a month, it’s a different environment than a property where rents are closer to $700 or $800 on average. 

You’ll want to consider different amenities and upgrades for properties in higher-income neighborhoods than lower-income spaces and make adjustments based on what that tenant will want and need. 

However, you should know that one type of property isn’t inherently better or worse than another. It’s just different. I truly believe there is a tenant for every property – and the challenge is to find the right tenant for your rental property. 

Consider The Neighborhood Standards When Selecting Amenities

Again, neighborhood standards come into play in almost every element of rehabbing and maintaining rental properties. When it’s time to decide what amenities to spend money on and which ones to skip, it’s important not only to think about what a prospective tenant needs, wants, and expects, but what other properties are offering their prospective tenants. 

• Remember, you or I likely won’t be the people who move into these properties, so it’s crucial to think about the fact that what might not be acceptable for us might be fine for a tenant and vice-versa. 

About 20 years ago, when I first started in rental property investments, I tried to do things I wanted to do and made decisions based on what I thought people would like. If you aren’t careful, you can fall into the trap of wanting to buy appealing amenities for your first investment property. I ended up spending more money than I should have, from the type of paint I used to the types of cabinets I chose – and my efforts didn’t pay off. I never recouped that investment. Instead, I lost it, and I learned my lesson. 

Save Money By Choosing Updates Based On Quality and Longevity

While it’s important to ensure you’re not spending or improving a property outside of the neighborhood standard, our clients are not slum lords. We don’t manage for slumlords, and our properties are all maintained and managed to the neighborhood standard. Our company values dictate that our properties are clean, move-in ready, and functional with working lights, furnaces, and other utilities. That’s what our tenants deserve. 

You can save money in the long run by ensuring that the updates you do make are focused on longevity and quality. Sometimes, it’s tempting to buy expensive materials and make changes based on what you think could bring in more money – but it likely won’t. Instead, consider the following strategies for updates that are cost-effective and still provide your prospective tenants with everything they need. 

• Use the same color paint in every room. This can save you money on touch-ups down the road and will avoid the odds you’ll have to repaint entire rooms, which can be costly. 
• Buy mass-manufactured cabinets and hardware. Instead of buying unique cabinetry or used cabinets, consider buying cabinets and hardware from stores like Lowe’s or Home Depot. Get the same ones every time, but make sure they’re good quality, not cheap. This way, if a door needs to be replaced, it’ll be easier to find a replacement rather than resulting in you needing to replace multiple cabinets because existing parts are unavailable or out of stock. 
• Choose affordable materials that will last. Make purchases that will do the job right the first time. However, don’t choose the most expensive options out there. Find affordable, sturdy materials for everything from bath fixtures to countertops and flooring that will look sharp and last for a long time. 

Final Thoughts

Choosing amenities for rental properties doesn’t have to cost a fortune. In fact, it shouldn’t. While it’s true that some investment properties you’ll purchase – or maybe want to purchase – may need more work than others in regard to updates, maintenance, amenities, and other basic repairs, focus on the neighborhood standards. These will dictate the level to which your property should be maintained. 

Even if you think you’d want a nicer dishwasher or a bigger outdoor space, remember that there’s a tenant for every rental property. The people who end up renting your property will be thrilled to live there as long as it’s clean, everything is in good working order, and you are willing to make repairs as needed to ensure it stays up to their standards. 

With the right team by your side, managing your investment property becomes a lot easier. If you’re concerned about how to make the right decisions about amenities to add, avoid, or other upgrades to make without breaking the bank, a good property manager will be able to advise you on how to make the money you do spend go further.