Are you a landlord wondering how to get the most out of your investment? It's not just about what you charge for rent, it's about maximising the return on your asset or rental yield. In today's competitive rental market, a property needs to stand out in order to achieve maximum return on investment. The good news is you don’t need a big renovation budget to make a significant impact.
Making small, strategic upgrades can attract and also retain higher-quality tenants, justify a higher rent, and significantly boost your rental yield. This post will walk you through five key upgrades that focus on cost-effectiveness and a high return on investment.
1. Overhauling The Kitchen And Bathroom
The kitchen and bathroom are the most used areas of the home and, therefore are arguably the best places to start for investment upgrades. Their condition and appearance are often a deal-breaker for many tenants straight off and will overrule any other features that may be desirable in a rental home. A tired, dated kitchen or bathroom with obvious signs of neglect and wear can instantly turn off potential renters, while a modern, clean one can be a major selling point!
Quick Kitchen Upgrade Ideas
- Paint And Handles. A fresh coat of paint on cabinetry and new handles can completely change the look for a minimal cost.
- New Benchtop. Replacing a damaged or old-school benchtop with a new laminate one can make the kitchen feel newer and more modern.
- Appliance Refresh. Consider upgrading the oven or stovetop to a modern, energy-efficient model. This is a powerful selling point, especially when choosing high-end brands.
- Splashback. A new style splashback (such as printed glass) is a high-impact, low-cost aesthetic upgrade that will impress prospective renters, plus they are much easier to clean!
Quick Bathroom Upgrades
- Re-Grouting And Sealing. A simple deep clean and re-grout can make a huge difference to a tired bathroom. Be sure to remove any signs of mould or discolouration.
- New Tapware. Replacing old taps and showerheads with modern, water-efficient fixtures is a quick win all around.
- Added Storage. Adding a new vanity or wall-mounted cabinet gives tenants more storage, while providing a refreshed and more modern look. Or you could add shelving or cupboards.
- Ventilation. A must for Healthy Homes compliance and preventing mould. Installing or upgrading extraction fans is a quick and easy upgrade.
Why It Works – because these two rooms are the most high-maintenance (require the most care and attention to look after), so if they are in good condition to start with, this implies less effort to maintain.
2. Boost Your Curb Appeal
A good first impression is everything. Before they even walk through the door, a tenant's decision can be heavily influenced by the property's exterior. Making your rental property look tidy and cared for from the outside shows potential tenants that you care for the property and are likely a good landlord.
- Exterior Touch-Ups. A fresh coat of paint on the front door and window frames can make the entire house feel refreshed. Or go all out and give the whole house a fresh coat of paint if the budget allows.
- Low-Maintenance Landscaping. A tidy front yard with a mowed lawn and trimmed bushes suggests a well-maintained home. Always opt for low-maintenance native plants and add bark mulch for a clean, easy-care look.
- Upgrade Fencing. Ensure the property is fully fenced (a must for families and those with pets). Even a fresh coat of fence paint or stain can help!
- Additional Security Features. Install motion-sensor lights or solar lights near the entrance for a more modern, secure feel when approaching the property at night.
Why It Works – This attention to detail on the outside of the home shows potential tenants that you are a proactive and caring landlord, which can attract a higher-calibre applicant.
3. Improve Insulation And Heating
In New Zealand, a warm and dry home is a high priority for both tenants' comfort and for legal compliance. Providing a well-insulated and properly heated home is one of the most powerful ways to attract quality tenants and secure a higher rental return on your investment. Plus, it's a relatively easy upgrade when considering cost versus benefit.
- Heating Solutions. The preference for heatpumps as a heating source has improved the accessibility of heating systems across the board in NZ. Installing modern, energy-efficient heat pumps is a huge drawcard as they provide both heating and cooling options for tenants.
- Insulation Checks. A no-brainer for any landlord, a quick insulation check is one of the easiest things you can do to improve the desirability of your property. Ensure ceiling and underfloor insulation is up to the required standard and consider injectable wall insulation if you own an older home.
- Draught Proofing. An easy one for the DIYers out there, work your way around the property and seal any gaps around windows and doors, vents and protrusions to prevent unnecessary heat loss and improve energy efficiency.
Why It Works - Tenants are willing to pay a premium for a warm, dry home, especially in New Zealand’s colder areas. This upgrade demonstrates your commitment to their ongoing well-being and comfort, while also potentially offering reduced energy bills.
4. Adding Smart Technology And Security Features
Modern tenants, particularly young professionals value convenience and security. Incorporating a few simple smart home or security features can make your property feel more modern and tech-friendly, setting it apart from the competition.
- Smart Locks. A keypad entry or smart lock offers a level of convenience appreciated by most, as well as eliminating the need for physical keys.
- Security Lighting. Adding motion-sensor lights near the front door or in the driveway is a simple yet effective way to increase security.
- Tech-Friendly Upgrades. Replacing a few standard power points with USB-C outlets or adding dimmable light tech are small touches that most tenants love.
Why It Works - These small additions add a layer of perceived value, making the property feel more modern and secure.
5. Upgrading Flooring And Window Treatments
Old, worn-out flooring and tired window treatments can make a property feel old and dated, and sometimes dirty even if it is otherwise clean. Revitalising these two areas can dramatically improve the overall aesthetic and feel of a room.
- Replace Flooring. Where the budget allows, replacing old carpet with durable, modern, and easy-to-clean vinyl planking or hybrid flooring is a good option in most cases. New carpet in the living areas is always appreciated (opt for wool-based carpets for added warmth and a touch of luxury).
- Replace Window Treatments. Swap out old, yellowed blinds or dated curtains. Consider modern roller blinds, plain, understated and neutral curtains that will easily integrate with different furniture and belongings. Avoid bright colours and vivid patterns that may put people off.
Why It Works - Clean flooring and new window treatments are a sign of a well-cared-for home and can dramatically improve a room’s aesthetic appeal and also the initial impression of the property.
By focusing on these five key areas, you can make your property more attractive to the rental market, secure higher rental yields and attract the kind of long-term, high-quality tenants that make your investment a success. Ready to take your property management to the next level? Contact The Rent Shop today for expert advice on maximising your property's potential.
