More and more people are choosing rental properties as a source of income with each passing year. There's always a market for renters. It's a good investment, as well, as rent continues to rise year after year.
Finding a fixer-upper is one of the classic ways to turn a profit on a rental property. A lot of people hear this and jump in blind. There's more to renovating a rental property than people realise, however.
Here are a few things you need to know about renovating a rental property, to make your renovation as easy and painless as possible.
1. Don't Expect Fast, Easy Money
Flipping properties was all the rage a few years ago. Flipping properties was all over the media, causing a gold rush of investors looking for the next get-rich-quick scheme.
The bottom has officially fallen out of that market, however. The average profits for flipped properties have fallen for the last three quarters.
There is money to be made, however. Reports show that buying and selling a house within a year yields £30k on average.
2. Stick to a Budget
Remember, the point of a fixer-upper is to maximise profits. You need to know ahead of time how much you're able to spend to get your rental property up to date.
The average cost of a home renovation is around £30,500. Renovations can cost much more than that, however. Especially when you get into more expensive renovations like the kitchen or bathroom.
Make sure to do the math and see how much you're able to comfortably spend for your property to remain profitable.
3. Decide to DIY
You should also realistically assess how much of your renovation you'll be undertaking yourself. A lot of people get this notion of buying a property and then putting in the hours to restore it to its pristine condition.
The problem is, they might not have the experience in home renovation in the first place to realise what they're signing up for. Renovating a property is very, very hard work. It's time-consuming and labour intensive at the best of times.
Before you even begin to think of renovating a property, realistically access your renovation skills. Think about what of the renovations you can undertake yourself, like painting or landscaping, for instance. Then create a budget with those factors in mind.
4. Find the Right Help
Finding the right person or team to help you with your renovation is often easier said than done. Simply looking up 'home renovators' on Google or in the phone book is going to tell you who spent the most on advertising, not what they're capable of.
Your best bet is to join some homeowner organisations in your area. Find some other people in your vicinity who've recently renovated their homes. Ask them for their recommendations and you'll get the inside scoop of what contractors and construction agencies to work with.
Rental properties are still an excellent source of income when you know how to go about it. Just remember that renovating a property requires hard work and dedication, the same as any other investment.
Are You Renovating a Rental Property?
You're in luck! we've been helping homeowners and property owners restore their properties to pristine conditions for years. It's one of our greatest joys.
If you're renovating a rental property, get in touch today to take advantage of our passion and experience.
Lee West has a wealth of experience managing and refurbishing high class properties in London. He has been the lead contractor in many prestigious buildings such as Buckingham Palace, Clarence House, Chelsea Royal Free Hospital, House of Parliament, Kew Gardens and many more.