Property Management Blog

Worried about the costs of renovations and what you’ll have to put into your Green Bay rental property just to get anything out of it? 

That’s an understandable concern. 

You don’t want to spend more money than you’ll earn back. 

However, smart renovations and upgrades are worth your time, money, and other resources when you’re trying to increase what you earn in rent. And there’s even more to gain. In addition to earning more in the short-term with a higher monthly income, you’ll also earn more money in the long-term, especially when you consider tenant retention, property values, equity gain, and other advantages. 

In short, renovations are great for maximizing ROI. They’re good for attracting and retaining high quality residents and making your investment property more profitable. 

But they have to be the right renovations. They have to make sense, and they have to make money.

Let’s look at some of the best ways to boost your rental income with smart renovations. 

Renovations: A Pro & Con List

We want to dig a little deeper into each of these bullet points, and then we’ll talk about the renovations that make the most sense.

Those Good Points: Why You Want to Renovate

• Increased Property Value

Renovating your rental property can substantially increase its market value. Upgraded kitchens, modern bathrooms, and well-maintained exteriors are highly attractive to potential buyers and tenants. When you decide to sell, these improvements can result in a higher selling price, ensuring a profitable exit strategy for your investment.

• Higher Rental Income

Real estate investment renovations often lead to an increase in rental income. Tenants are willing to pay a premium for properties that offer modern amenities and a comfortable living experience. For instance, adding energy-efficient appliances or upgrading the heating and cooling systems can justify a higher rent, boosting your monthly cash flow.

• Attracting Quality Tenants

Renovated properties are more likely to attract high-quality tenants who are looking for well-maintained homes. These tenants are often willing to sign longer leases, reducing turnover rates and ensuring a steady income stream. You’ll have less vacancy to worry about and by retaining these tenants, you’ll also have fewer turnover costs. 

• Competitive Edge in the Green Bay Rental Market

In a busy rental market, having a renovated property gives you a competitive edge. Prospective tenants will be more inclined to choose your property over others that may not offer the same level of comfort and modernity.

• Lower Maintenance Costs

Investing in renovations today can save you significant maintenance costs in the future. Upgrading plumbing, electrical systems, and roofing, for example, can prevent costly repairs down the line. By addressing these issues proactively and making improvements before things can deteriorate, you maintain the property's condition and avoid unexpected expenses.

• Increased Property Longevity

Renovations can improve the structural integrity of your property. Addressing issues like foundation cracks, outdated electrical wiring, or deteriorating roofing can extend the lifespan of your property, protecting your investment for years to come.

Regular updates to the aesthetics and functionality of your property keep it relevant and appealing in the long term. Trends in home design evolve, and keeping your property up to date ensures it remains attractive to tenants and, eventually, buyers.

Challenges to Prepare for During Rental Renovations

• Budget Constraints

Sticking to a budget is one of the toughest parts of any renovation project. Unexpected costs can quickly add up, putting a strain on your finances. You can overcome this challenge by planning thoroughly. Create a detailed budget that includes all potential expenses, including a contingency fund for unexpected costs. You can also collect multiple quotes from contractors to ensure you’re getting a fair price. Prioritize what you’re doing. We’ll talk more about this in a bit; focusing on renovations that offer the highest return on investment (ROI) will help yo avoid overspending.  

• Finding Reliable Contractors

Hiring trustworthy and skilled contractors can be challenging if you don’t have these relationships in place already. Unreliable contractors can lead to delays, shoddy workmanship, and increased costs.

Do your research before hiring anyone. Check reviews, ask for references, and verify licenses and insurance. Make sure that you have a detailed contract outlining the scope of work, timelines, and payment schedules. It’s always important to maintain open and clear communication throughout the project to avoid misunderstandings.

A tip to overcoming this challenge: work with a Green Bay property manager on your rental property renovations. We already have a team of trusted, reliable, and cost-effective contractors. And, we’ll do all the negotiating, communicating, and project management for you. 

• Managing Tenant Expectations

If you’re making updates and upgrades while a tenant is in place, you might find that renovations can be disruptive to tenants. Balancing their comfort while completing the work can be tricky. Make sure you inform them in advance about the renovation schedule and expected duration. Try to schedule work when tenants are less likely to be home so you can minimize the disruption that it causes. 

• Surprises and Unforeseen Issues

Renovation projects often uncover hidden problems, such as mold, structural issues, or outdated wiring, which can complicate and delay the project. It’s impossible to prepare for everything, but you should always have a contingency plan in place. Budget for what you can’t possibly see coming, too, and address any issues right away. Flexibility is important. 

What Are the Smartest Investments a Rental Property Owner Can Make?

Let’s put on the thinking caps.

Our experience as Green Bay property management experts tells us that these are the best improvements you can make when you’re increasing ROI for your investment property.

Functional Upgrades and Renovations

There is maintenance, which is important on its own, and then there are the upgrades and renovations that keep your Green Bay rental property functional, habitable, and a good place for tenants to live. When you consider functional upgrades and updates, we invite you to think about repairs versus replacements. Is it worth it to keep repairing a refrigerator every year? Or, should you replace that older model with a new one instead? 

• Appliances 

Upgrading your appliances will deliver a lot of ROI. You’ll have to spend some money in order to acquire those appliances, but in the end, you’ll earn higher rents, attract better tenants, retain those tenants, and improve the condition and the value of your property. Focus on kitchen appliances. You don’t necessarily have to upgrade to stainless models unless all of your competitors are offering stainless kitchen appliances. In that case, it’s a good idea to buy them for your own property. Look for energy-efficient models that will save money on utilities and look great in your property. Tenants are looking for convenience, and that means a dishwasher and an in-unit washer and dryer. Appliances are an excellent place to start when it comes to renovating and updating your investment. 

• Lighting

Lighting is largely about aesthetics, but it also qualifies as an essential function that your property needs. Indoor lighting has to be intentional. Tenants will want brighter lights in the kitchen and the bathrooms, while a softer light in living spaces and bedrooms will work better. Outside, lighting should be all about security and safety. Make sure there’s a bright light at the front door or any entries. Tenants will want to feel safe coming home and they’ll also want to be able to see who might be at the door of their home when it’s dark out. Consider installing motion-detected lights on garages, outdoor sheds, and other exterior spaces. 

• HVAC 

Your heating and cooling system is perhaps one of your most expensive household functions. Keep it well-maintained so you don’t have to make expensive replacements, and when your HVAC tech suggests making some updates and upgrades during service calls, be willing to hear them. You don’t want any rusting coils or dusty air vents. Keep up with air filter changes, too. 

Aesthetic Renovations That Increase ROI for Green Bay Investment Properties

Like buyers, tenants are emotional creatures. They’ll want to connect on an emotional level with a home before they agree to complete an application and sign a lease. The best way to reach them on that level is by making your property look attractive. 

What contributes to an attractive rental home? Several things. When we’re talking about the renovations that you choose in order to increase ROI, we recommend you focus on these aesthetic improvements. 

• Curb Appeal and Landscaping 

We don’t have to tell you how important first impressions are. Major buying decisions are made based on the immediate perceptions a consumer has of a product or service. This applies to tenants and rental properties, too. You want to grab prospective tenants’ attention in a positive way and hold onto it. This is best accomplished by providing the “wow” factor as soon as they drive by, walk by, or pull up for a showing. When it comes to good curb appeal, you’ll want to start with landscaping. Whether you’re renting out a single-family home or a multi-family unit, make sure the grass is cut and green. Trim back any rogue branches on trees and bushes. Pull weeds. Apply fresh mulch to flower beds and shrubs. 

Evaluate the exterior paint on your property. Does it need a fresh coat? If not, perhaps a good power-washing will breathe fresh life into the structure of the property. Make sure the front entrance and any outdoor space is clear of debris, trash, and old items that may have been collected like trash bins and furniture. 

• Paint 

We talked about the importance of exterior paint, and the interior paint requirement should seem like an obvious and necessary upgrade. You likely repaint your property during every turnover period, and that’s a good idea. While paint may not seem like a renovation, you can make it a valuable part of increasing ROI by investing in high quality paint. This will be more durable, easier to clean, and it may cut down on the frequency with which you do have to repaint between tenants. 

• Floors 

Sad looking carpet has long been a fixture in rental homes across Green Bay, and if you want to set your property apart from others on the market and earn some higher rents from better tenants, you’ll tear out that sad carpet and invest in some quality flooring. You don’t have to go full hardwoods. Instead, install a good laminate. There are a lot of options. Some flooring will snap right into place and other flooring can be customized to your property at a price that isn’t horrifying. Investigate the options. Talk to some flooring experts. Give your tenants a good reason to choose your rental property over all the others. 

Here’s why hard surface flooring is such as valuable and ROI-rich upgrade:

• It’s easier to clean and maintain.

• It’s healthier. Fewer odors, less dust, and zero allergens will get stuck like they do in carpet fibers.

• It looks better. 

• It’s a better long term investment; you won’t have to replace it during every turnover.

Consider those hard surface floors, especially in common areas like living rooms, dens, and dining areas. This is especially beneficial when you allow pets. Trying to remove pet odors from carpet is nearly impossible. 

• Fixtures 

Fixtures are extremely aesthetic and very easy to renovate at a low price. Think about the faucets on your sinks. Think about the mirror in your bathroom. The drawer pulls. The plates over your light switches. All these things are extremely affordable and yet give the property a new, modern feel. A tile backsplash behind the sink or stove will only require a handful of tiles and make the place look great.

Special Renovation Features That Make You Money

Outside of functions and aesthetics, what kind of features will draw people to your property? 

Here’s a brief list:

Choosing the smartest renovations for your Green Bay investment property is highly specific to the age and condition of your property as well as the neighborhood that you’re in. These are some general recommendations we have for smart upgrades and renovations that will make you more money now and in the future. For a more specific and personalized assessment of where you should make your renovations, we’d need to take a look at your property and examine the competing properties in the local neighborhood and market. 

Let’s do that. When you need some advice from an experienced Green Bay property management expert, contact us at Blue Frog Property Management. We’d love to help you earn more money.