How to Rehab a Rental Home for Tenants

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How to Rehab a Rental Home for Tenants

When you purchase an investment property, you are most likely going to have to rehab it, unless you are purchasing a turnkey property. Rehabbing a property for rental purposes is quite different than rehabbing a property for personal and residential purposes. While you don’t want to skimp on any major features, it is important to remember that the property will undergo substantial wear and tear—more so than if you were to reside in the home yourself—so selecting all top of the line, expensive materials just isn’t cost effective.

Rental properties require a slightly different rehabbing procedure, too. There are often more hoops to jump through and more paperwork to file, as well. You need to have everything documented, from start to finish, in order to protect yourself from any legal complications in the future.

City Inspections

City inspections are vital when utilizing a property for rental purposes. While inspections are required for just about any home renovation or rehabbing, when a rental property is involved, it is even more important that you follow and adhere to all city inspections and codes, as neglecting to do so can cause serious legal trouble for the landlord down the road. It is important to cover all your bases when in the landlord position.

When undergoing any renovations or rehabs in a property, you should always ensure all the correct permits and licenses are filed with the city or other governing municipality. Scheduling your inspection prior to the completion of the work will also give you the heads-up on what the city is expecting and will allow your renovation team to be aware of any city-specific codes or regulations that may be in place.

There is often a specific list that city will require to be completed in order to be certified as a legal rental property.

Having a city inspection prior to any work will give you a list of current violations. This list will make a good tool for your renovation team, as they will have a black and white listing of items that must be corrected to pass any final inspection.

Scope of Work

Before beginning any projects, you should always write up a scope of work.

This document is a useful tool for both investor and renovation workers, as it gives a clear picture of what is to be expected—both work-wise and budget-wise.

A scope of work should include any items included on the city’s violation list as well as any aesthetic appeal items. These include any painting, flooring, doors, hardware, lighting fixtures, or landscaping that may need to be done.

When creating a scope of work, make sure to plan out what is best for a rental property. In most cases, you want to allot most of your budget to the two most important rooms in the house—the kitchen and the bathroom. Account for any new appliances, doors, hardware, fixtures, or flooring that need to be replaced, added, or updated. Don’t forget to factor in paint and flooring that will withstand excessive wear and tear.

Flooring Options

When it comes to a rental property, you want to think durability. The truth of the matter is, nobody treats a property as good as when they own it, so being aware that your property won’t be held to that regard will help you in selecting the best options for features such as flooring.

When possible, avoid carpets as they can be difficult to clean and easy to damage. Carpets also hold in smells, which is the last thing you want in a rental property.

Using other options of flooring will be easier to maintain over time and easier to clean between tenants.

Each type of flooring has its own pros and cons, so it is important to analyze each one and weigh your options. Hardwood flooring is often the most sought after, but it can be expensive and requires specific care practices, which you can’t always count on your tenants to keep up with. Ceramic tile comes in a variety of price ranges, but can be easily cracked or shattered by uncareful tenants. Vinyl flooring is often the safest choice for rental properties, as it is relatively inexpensive and durable. Vinyl can be installed in a variety of ways, including tile format, plank, or sheet. When considering your options for a rental property, vinyl plank is usually the best alternative as it can be replaced in segments if it becomes damaged instead of having to replace an entire room if used in the sheet format.

Kitchen and Bathroom

While it is important to keep costs to a minimum when rehabbing a home, you do need to ensure you are creating a welcoming environment that will be appreciated by tenants. A home with several perks will likely rent faster and remain rented longer than a home that is strictly basics. However, there are budgeted ways to do this, such as focusing on the two rooms that get the most attention: the kitchen and bathroom.

When it comes to these rooms, this is where you want to allot the majority of your budget. These rooms are used most frequently by both the tenants residing in the home and any guests they have over during their stay.

Consider updated any appliances or hardware in these rooms. Pay attention to the lighting, colors, and layout. Adding inexpensive but attractive touches, such as a tiled backsplash, will help to create a welcoming ambiance and add flair to the home’s rental appeal.

When renovating or rehabbing a property strictly for rental purposes, it is important to look at it from your tenant’s point of view. Your particular tastes do not come into play. You want to keep up with the latest trends in the rental industry and create a home environment that is welcoming and fluid—making it an comfortable and easy to maneuver space. Keep in mind the features tenants most look for—dishwasher, updated kitchen and bathroom, new paint, blinds, etc—and focus your efforts on these.

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