Adding value to your rental property is not necessarily a task to directly increase income, although generally, this is a benefit.  By adding value in this sense, we are discussing ways to make your unit more attractive to existing tenants and more marketable to potential ones.  Below we have a few ideas on how to add value for both single-family and small multifamily rental properties that won’t break the bank.

Many of these options may seem obvious, but you’d be surprised how many landlords overlook them.  The nice part of these suggestions is that many of them are ones most anyone can handle and DIY.

Update Landscaping and Curb Appeal

We cannot stress enough that first impressions are key.  So, when you advertise your unit, do yourself a favor and include photos of the front of the home or building.  For more tips on how best to do this, check out our blog, Tips For Taking Great Rental Property Photos.

You can keep this simple or go all out.  Remember that whoever lives in your rental property needs to keep it up, so be mindful about maintenance.  For example, add some pretty flowers, trim bushes, and put down some bark or ground cover in flower beds.

As property managers for our family members, we had one home where we took a tired-looking area and spruced it up.  We used wood chips that our city provided for free and transplanted some day lilies and purple coneflowers from our yard.  We had planned on pulling these flowers out anyway as they were too overgrown for our yard.  This update cost us nothing but a few hours of labor.

If you want to go all out, consider converting the front yard into a low-water, low-maintenance garden using large rocks, gravel pathways, and plants that do not require a lot of water or pruning.  It helps the new tenant and looks great all year round.

Consider adding path lighting to decrease the chances of your tenant or a guest tripping and falling.  These lights are a great solar option we added to our multifamily pathways.

For the house’s exterior, clean the windows and touch up any paint that may be peeling or chipped.  Next, change out worn light fixtures with LED, efficient lighting.  Or, if the lighting is still good but needs a touchup, buy a $3 can of spray paint, tape off the glass, and paint away.

Inside the Home

Swap out old hardware for new on kitchen and bath cabinets.  You only need a screwdriver and some replacement knobs or pulls that you can pick up at any hardware store.  Clean the cabinet faces with a soft rag or sponge, warm water, and dish soap before you install the new knobs.

No knobs to replace?  Add them to cabinets for a nice touch.  Having pulls and knobs on your cabinets prolongs their life.  This simple task makes the area look fresh and new with little effort.  Can you see how this simple task can add value to your unit?

Change out old lighting for energy-efficient LED lights.  I know those “boobie” lights were only $20 in 2010, but do yourself (and your tenants) a favor and put in something a little more modern.  Unless you have a period-style home, many tenants appreciate brighter light that costs them less in energy fees.

Have incandescent recessed cans in your rental property? These can easily be retrofitted with new trims if you have 5″ or 6″ recessed cans.  It took me about 20 minutes and $30 to swap these out in our units.  They are brighter and have a very long life.   We installed these FEIT retrofit trims over 5 years ago, and they are still going strong.  If you provide dimmers, you’ll need to replace those with an LED-compatible one.

Best part?  Your tenants will not have to worry about getting on a ladder to replace bulbs because there aren’t any!

With remote working being popular, having reliable internet is a HUGE plus for renters.  If your area qualifies for fiber optic internet lines, consider wiring your rental property with those lines.  Then, you can advertise it as ready to accept their own fiber optic internet company OR, to really add value, offer internet as part of a package for a fee.  Providing internet for a fee is especially appealing to tenants who have to sign a 2-year contract with the provider but may not plan to stay that long in your unit.  Plus, it’s one less bill they must pay each month.

The following items are more focused on multifamily-sized units than single-family homes but are something to consider when considering how to add value to your rental property.

Create Outdoor or Social Spaces

For many years we had a concrete area behind our 6-plex that only had a metal bench.  Little by little, we started adding outdoor furnishings for the tenants to have a communal, private outdoor space to read, gather with friends, and BBQ.  Our first purchase was outdoor seating.  We picked up a plastic wicker set up on sale at Ace Hardware for $500, including a settee, two chairs, cushions, decorative pillows, and a glass-top coffee table.  We loved how we just had to hose it off for cleaning.  Assembly was not difficult at all.   We picked up a small outdoor rug on Amazon to lay underneath.

We wanted to wait to see how the tenants responded and used this patio set before moving forward with more pieces, and we had very surprising positive feedback!  One tenant wrote to tell us how much they appreciated the space and that when his parents came to visit, they were able to sit in the nice weather and enjoy each other’s company.

So, the following spring, we had our electrician out and asked him to run a couple of receptacles and wiring for a timer switch.  Then, we headed to Costco to purchase a few boxes of party string lights and strung them in a zig-zag pattern across the back patio.  This new lighting enabled the tenants to enjoy the space at night.  Of course, evenings in Sacramento are the best time to be out during the summer months anyway.  We also purchased a square dining table and four chairs to add to the area.  So now our tenants could eat outside if they pleased.  This addition was a huge success!  We heard from neighbors that one tenant had invited them over for a wine tasting evening, and they all sat out in our little back patio and had a really nice time!

The following year we purchased an electric grill (one reason we had additional receptacles installed) to complete the patio.  Electric grills are the way to go!  No propane to fuss with, no hot coals to worry about causing a fire or burning someone, and it’s a breeze for the tenants to clean up after themselves.  We chose one similar to this grill.  If you watch sales on Amazon, you can pick one up with a good discount.  Right now, this product includes a $15 off coupon!

The day I write this, we found a tenant out back enjoying his lunch with a friend.  It just warms our hearts to have taken a dead area of the property and converted it into an outdoor living space for our tenants to enjoy.

Can you see how these small improvements have added so much value to our rental property?  We include photos of the patio when we market for a vacancy and often have prospective tenants ask to see the area when touring the unit and property.

If you don’t have one wide open space to use, maybe consider adding some small social spaces around the property.  Perhaps you have a nice tree and can place a bench under the shaded side.  Or there’s a dirt area where you can lay some pavers and add a small bistro set for tenants to sit and have coffee.  Walk your property and see where you can create areas for these outdoor living spaces.  It may seem silly, but this little effort shows your tenants you are working to improve their environment.  You are adding value to their experience of living there.  So, when you increase the rent on your next renewal, your tenants will feel like they are at least getting something in return.

Deter Porch Pirates

One suggestion for multifamily rental properties is to install a parcel lockbox.  With the high level of porch pirates, we have had excellent results since adding this perk.   These units can include mailboxes to replace your old ones (only USPS can access them) or parcel boxes for use by other delivery companies.  We installed a freestanding mailbox that houses eight mailboxes and three parcel boxes.  It even has an outgoing mail slot for the mailperson to take.  They include a special key that all USPS mail carriers have.  Their key opens one door for access to all compartments.  When there is a parcel,  the mailperson will place your tenant’s delivery there, then insert the parcel key into their mailbox to access that one parcel box.  After the package is retrieved, the key stays locked in the parcel lock until USPS uses it again.

They do sell parcel boxes that can bolt to the cement for units with secure mailboxes but no place to safely secure packages.  USPS cannot use these, but all other delivery services can if instructed to do so.   Here is a parcel box we are thinking of adding to our multifamily 6-plex for deliveries from Amazon, etc.  Of course, the tenants all have identical keys, so a trust factor is involved.

Add Storage and Charge Rent For It

Other not-so-inexpensive but very appreciated way to add value to your rental property is to build storage units behind or in the basement of your building.  You can easily charge $50 or more per month.  For example, if you have a basement, you can put up chain-link fencing that goes floor to ceiling and have a locked gate. Then, charge your tenants to store their extras in there.

The basement is also great for installing coin-operated washers and dryers if you do not include them within your units.  One thing tenants dread is having to haul their laundry out and off the property to wash it.  Even if you can only afford one set to start, you’ll make your money back in no time.

Because we do not offer storage units, we are considering adding bike lockers to our property.  We have had multiple bikes stolen from tenants.  Given we are in a downtown area, our tenants like to use their bikes to get around.  Often we see them parked inside the unit, making it difficult for the tenant to move around freely.  Dura Bike Lockers completely encase the tenant’s bike to deter theft.  You can charge upwards of $25 per month for rental access to the locker.

Parking for Tenants

Lastly, if your unit does not offer parking and street parking is tough, work with a local commercial space or parking lot to rent spaces at a discount for your tenants.  You then charge your tenants a little more than what you pay for these parking spaces.  Talk about added value!  If you can include parking with your unit for a nominal fee, you’d be the hero landlord to many tenants!

As you can see, you do not have to do extensive remodels to kitchens and baths to add value to your rental property.   If you had to select one significant improvement, a nice touch is to renovate flooring to luxury vinyl planks.  They look like hardwood floors but have the durability of vinyl floors.  Most offer water resistance or waterproof protection, which is especially great for those tenants with children and pets.  However, this option can be costly depending on how much flooring you need to replace.

How You Can Afford Small Improvements

I’m sure you’ve heard the term, “You have to spend money to make money.”  Many of these suggestions can cost less than $500 if you do the work yourself.  So, pull up your sleeves and put in some sweat equity!  Unfortunately, for some of you, paying $500 or more is too much.  So, how are you supposed to afford these improvements that add so much value to your rental property?  Two words: CASH.  RESERVES.

You are doing yourself and your rental property business a huge disservice, if you do not set aside cash reserves out of the rents earned each month.  These improvements are precisely how cash reserves should be utilized.  Click the link below to read our blog on implementing and using cash reserves.

Cash Reserves for Rental Properties, How Much is Enough?

Finally, check with your tax advisor about how these improvements will affect your bottom line.  Often, the government will reward you with deductions off your profit for improving your rental property.  Depending on the amount spent, it can be either be expensed or considered an improvement.  Again, as we are not tax or legal advisors, check with your CPA and make sure these benefits apply to you.

Check out our other blogs to guide you on your self-management journey as a landlord:

How Landlords Can Help Tenants Improve Their Credit Score

The Pro’s and Con’s of Holding Your Rental Property In An LLC

Why Landlords Need to Use Independent Contractor Agreements

How to Handle Unapproved Roommates in Your Rental Property

Buying Rental Property?  Make Sure You Evaluate These Structural Items!

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