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The best time to renovate a rental is almost never the moment you finally get sick of looking at the kitchen. You can pick the perfect flooring, get a fair bid, and hire a great contractor to install it, and still lose money on the whole thing. Not because the work was wrong. Because the timing was.
Kevin opens with the framing that clears up half the confusion on this topic. There are only two categories of rental renovation, and landlords get themselves in trouble by applying the rules of one to the other. Once you know which bucket you are standing in, most of the hard decisions get a lot easier.
From there he makes the case for the window we use almost every time, and he backs it with three reasons that stack on top of each other. One of them is a cost most landlords never think to count. Then I take the calendar side of it, because rental markets are seasonal, and the best time to renovate a rental usually sits right inside your slowest months. I also get into why your own leasing history beats any general rule you will read online about the best time to renovate a rental, including ours.
Then there is the part where you do not get a choice. We had a bathroom flood in Chico, and there is no version of that where I sit down with a seasonality chart. That leads into the livability conversation, and one question I flag rather than answer, because I truly cannot answer it for you. What I can give you is the phone call to make before you ever need it.
Kevin also tells you about the Idaho unit, where we learned that the best time to renovate a rental and the right reason to renovate one are two separate questions. Three weeks of work, most of it the two of us on our hands and knees, and we did not get enough of a rent bump to justify any of it. We would still do it again, and the reason is worth hearing before you spend a dollar on your own place. Plus the three week vacation that became the best renovation window we have ever had, what actually fits into a one week versus an eight week timeline, and the appliance we refuse to buy anymore.
By the end you will know how to pick the best time to renovate a rental you own, and whether your next project is a business decision or a preference. Both are allowed. You just need to know which one you are making.
What You’ll Learn in This Episode
- Why the best time to renovate a rental is almost never the day you decide to
- The two categories of rental renovation, and why mixing them up costs you money
- Why tenant turnover is the single best renovation window, in three stacking reasons
- The cost of working around a tenant that never shows up on a bid
- How the off-peak season play turns weak vacancy days into free renovation time
- How to pull your own leasing history and find your real peak season
- What basic livability rules mean in the middle of a renovation
- The hotel question nobody can answer for you, and the two things to do about it
- The one insurance call to make long before a repair ever displaces a tenant
- What actually fits into a one, two, four, and eight week timeline
- How to calculate the ceiling on what any renovation can earn you back
- When to DIY, when to hire out, and the jobs you should never touch
- The appliance we stopped providing entirely, and the reason why
- What to know about smart devices before you install a single one
Key Takeaways
1. The Best Time to Renovate a Rental Is During Turnover
If you take one thing from this episode, take that. An empty unit is dramatically cheaper to work in, because a crew can drop their tools, spread out, and leave the mess overnight. In an occupied unit, every single day ends in pack up and clean up, and you are paying for all of it. Turnover work is also close to free vacancy, since you were going to have the unit empty anyway. If your standard turn is one week and the renovation takes three, you did not lose three weeks of rent. You lost two. That is the number that belongs in your spreadsheet.
2. Your Own Leasing History Beats Any General Rule
Everyone will tell you the best time to renovate a rental is the slow season. Fine, but which months are slow where you own? Go pull three to five years of your own leasing history and look at when applications spiked and when units sat. That is your peak season. Everything else is your renovation window. Because a general rule falls apart fast in a snow market, a college town, or the desert in August.
3. Some Repairs Are Not a Decision at All
Nearly everywhere in this country there is some version of a rule that says a rental has to be livable. Working plumbing, running water, a functioning toilet and shower, heat, working electrical. So if a repair takes the only bathroom in the unit out of service for any real stretch of time, you have moved past inconveniencing somebody. Whether you owe that tenant a hotel depends entirely on where your property sits, and that is a question to answer before you need it, not during.
4. The Best Time to Renovate a Rental Still Has to Pencil Out
Look at what the top of your local market is actually renting for right now, not what you hope it rents for, and compare it to what your unit rents for today. The gap between those two numbers is the ceiling on what a renovation can earn you, and you will never capture all of it. If that gap is a hundred dollars a month and the project costs twenty thousand, you are looking at more than sixteen years to break even on rent alone. That does not mean do not do it. It means do it for the right reason.
5. DIY Saves Labor and Costs You Time
Who swings the hammer changes the best time to renovate a rental, because it changes how long the unit sits. If a crew would take one week and you would take three, ask what two extra weeks of vacancy costs on that unit. On a four thousand dollar a month rental, that is two thousand dollars. If hiring it out costs less than the difference, you are not saving money by doing it yourself. You are paying for the privilege, which is allowed as long as you know that is what you are doing. And there is a short list you should never touch regardless of skill, starting with anything that needs a permit.
Links & References Mentioned in This Episode
Episode 91: We Renovated 2 Out-of-State Units, Would We Do It Again? — the full Idaho story
Episode 117: Why We Installed Smart Locks (And Would Do It Again) — before you add any smart device
Episode 96: Tips From Our Contractor — everything Jim has taught us over the years
Episode 139: Landlord DIY vs Hire Out — the four-question filter for what to handle yourself
Episode 137: Emergency Maintenance vs Routine Repairs — what is urgent and what can wait
ENERGY STAR Rebate Finder — enter your zip code to find local utility rebates before you price a bigger efficiency upgrade
DoorLoop: The landlord management software we recommend for larger portfolios
TurboTenant: Great landlord management software for newer landlords
Avail: Free Landlord Software
EZ Landlord Forms: State-specific lease documents, notices, and addendums
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