How Regular Maintenance Can Increase Your Property Value

Rental real estate is often the preferred investment for people who want investments that are safe and stable.

They meet many of the criteria set by savvy investors. Rental properties are a source of steady cash flow. There are several financial instruments that investors can use when buying houses. And property owners can expect to see the value of their investments appreciate over time. But like all good things, rental properties have their other side too; they require a good deal of the owner’s time. Rental property is not the kind of investment owners can “set and forget.” All the benefits of investment real estate hinge on the owner’s ability to properly maintain the asset. If a property is not well-maintained, it loses its attractiveness, stops generating rental income and eventually depreciates, warns https://bighornrentals.com/

Why maintenance matters for rental property value

There are four ways that poor maintenance will impact the value of a rental property.

1) It makes it harder to rent The owner of a badly-maintained property will find it hard to get tenants to rent the property. If they do manage to get tenants, it will be people who are unable to get better accommodations. Such tenants are more likely to owe on rent and utilities, in addition to causing more damage to the property. Even when the owner is fortunate enough to find a good tenant, the person is not likely to stay for the long-term. Owners who don’t maintain their rental property sabotage their own business.

2) Higher operational costs A poorly-maintained home costs more to operate. It is more susceptible to damage and appliances break down more often. Repairs also cost more to fix because the damage is not detected early, due to the owner’s negligence. Faults are a cheaper fix when they are caught on time. But if allowed to progress, they affect adjoining systems and other parts of a home. This is how minor issues can result in extensive damage to a property.

3) Out-of-control depreciation Regular maintenance is how property owners keep control of the depreciation value of a property . By keeping abreast of maintenance and carrying out necessary upgrades, the owner retains more of the original value of the property. Inadequate maintenance allows wear and tear to accelerate. If tired appliances and worn- out areas of a home are not replaced, the cumulative effect will be a decline in the property’s value.

4) Investment failure Poor rental property maintenance causes the owner’s investment to fail. The main reasons people invest in rental property is to earn rental income and for value appreciation. These benefits are heavily dependent on how well a property is maintained. If a property is not well looked after, it cannot be profitable. Even if it generates rental income, it may not be sufficient to cover the operational costs of the property. And when the owner eventually sells the property, they may do so at a loss.

Adding value through preventative maintenance

Good maintenance not only helps to retain a property’s value, but it also improves its value. This is because a home’s value is measured against those of comparable properties in the same area. This means owners can improve a property to the point where it serves as the benchmark against which the value of other properties is determined. This is done via preventative maintenance and strategic upgrades to the home. There are four areas of rental maintenance that are critical for improving property values.

Appliances

Renters are naturally drawn to homes with the newest and most functional appliances. The value of a home as a rental property fluctuates with the quality of appliances inside it. Tenants will often rate functioning and easy-to-maintain appliances on the same level as the safety of a neighborhood. Also, older and less functional appliances cost more to maintain and deliver less value. Additionally, they are likely to increase a home’s energy consumption.

Interior

The interior of a property is a huge part of its maintenance regimen and the first thing on the list is cleaning. Another important area of interior maintenance is replacement; for old carpets, fixtures, dripping faucets, and sticky door handles. Keeping wall paint fresh is an absolute requirement ; it should be every three years, or at least, every five years. An area that is overlooked is keeping door and window locks and seals in working order.

Exterior

Maintaining the exterior of a property increases curb appeal, boosts its value as a rental property, and makes a good impression on potential buyers. Exterior maintenance covers all external aspects of the building, as well as, its roof, and wiring. Exterior maintenance also includes routine landscaping and painting. It includes mold remediation for the entire property and foundation maintenance.

Documentation

Creating a detailed maintenance schedule and keeping full records of all maintenance will help owners maximize ROI on a property. It allows property owners to recoup more of what they spend maintaining the property. By making those records available to prospective buyers, property owners can get a higher sales price for the property.