Renovating and upgrading some of your apartment’s features may boost its value and attract better quality tenants. However, it can be quite a challenge determining how much you should expect to spend on refreshing your tenant’s home.
When it comes to major renovations or even a cosmetic reno project, a detailed plan and loads of research is required. Before you get started, inspect every nook and cranny of your rental to find out what needs updating.
To help you determine your project’s budget, here are 5 steps that you may take:
- Consider what needs to be renovated. A reno may be able to boost your rental’s appeal and can help you in the future should you wish to sell the property. Some reno projects that are worth considering are:
- Kitchen. The kitchen is the most popular room to renovate, taking up 26% of all renos in 2018, according to Houzz. The average cost of a budget kitchen reno starts at about $10,000 and go up to $25,000, according to Domain. It may sound like a steep price to pay, but an updated kitchen may add considerable value to your rental and improve its space and functionality.
- Bathroom. A bright and fresh bathroom is welcoming. Consider refreshing the tiles, and updating the shower head, door handles and toilet for an instant and affordable upgrade. Keep in mind that you want to update the bathroom to adapt to your prospective tenant’s need. The average cost of a bathroom renovation is $17,054, according to the Housing Industry Association (HIA), but you don’t have to spend that much to make an impact. Upgrading the bathroom not only adds appeal, but it can add value, too.
- Lighting fixtures. Lighting affects how your apartment will appear to tenants. A gloomy-looking apartment that has faulty fixtures may lack appeal for tenants. Consider replacing old lighting fixtures with new ones to open up your rental’s space. The average cost of lighting installation is around $85-132 per hour for an electrician, while the cost of lighting fixtures themselves range from $15 to $300, according to HIREtrades.
- Flooring. Consider replacing old and stained carpets with new ones. You may also opt for tiles or laminate flooring. Updated flooring may make the apartment feel more modern and attract tenants. Hardware flooring may cost as little as $2.27 for 65x12mm to $315 for 186 x 14 x 2200mm, according to Bunnings.
To help you determine how much you need for your apartment’s reno, consider what needs to be renovated by inspecting your rental yourself or have your property manager inspect it. This way you may be able to determine what needs to be renovated, updated, or entirely replaced.
Remember that the renovations will be completed to attract your ideal tenants and not to just please you and your taste. Try to separate your personal taste from what your ideal tenants may need.
- Know what can be done on the cheap. When it comes to apartment renovation, you have to carefully manage your budget. It doesn’t mean you have to do the all renos on the cheap – in fact; this can be more costly in the long run, as you often get what you pay for. But you do need to carefully consider the budget you’re able to allocate and weigh it up against your renovation wish list.
For instance, you could save on the paint by doing it yourself, while any electrical work needs a licenced electrician. Hanging blinds or curtains might fall within your own area of expertise – but don’t try installing carpets and tiles unless you know what you’re doing!
Don’t cheap out on important renovations, as you end up periodically fixing them because their quality is subpar.
Some reno projects and updates that you may be able to do on the cheap are:
- Counter. Replace worn out counters with a simple, more functional ones, which will instantly breathe new life to the kitchen area. The average cost of replacing a counter can be as little as $500 for a basic countertop in a small unit, throughout the $5000+ for a 40mm stone benchtop. It really depends on the style, size and quality.
- Tiles. You could update your bathroom’s floor by replacing old tiles with newer ones. The average cost is $41 per 30x61cm.
- Fresh paint. A fresh coat of paint can greatly light up your rental. Average cost of paint ranges from $40 to 138 per 10 litres.
- Updating handles and shower heads. New handles and shower heads will easily make your bathroom more appealing, transforming the bathroom from looking sad and mouldy to fresh and modern. Tap handles can cost as little as $14 and as much as $250 on average, while an affordable shower head may set you back $100.
Note: average prices based on Bunnings Warehouse
- Know what you can and can’t renovate. Do your due diligence and find out about the building regulations on your state. Make sure to get information about your state’s strata-by-laws, if your rental property is within a strata building. Strata-by laws explain what you can and cannot renovate.
In general, you cannot do any renovations that detract from the appearance of a strata-building complex. Renovation projects like putting a fresh coat of paint on the walls and updating the flooring (e.g. carpet) may not need an approval from the corporation where your apartment belongs to. On the other hand, major changes involving structural renovations affecting the external appearance of the apartment may need approval.
You may check the following links to know more about your state’s renovation rules:
- Find the right reno team. Finding the right team to do your reno project may take time and some effort, but it’s invaluable. Don’t cheap out and get the most affordable suppliers and tradies out there, but consider investing in workers that have a reasonable price without sacrificing quality.
To determine the right team to do your apartment renovation consider the following:
- How big (or small) your renovation project is. If you only plan to do minor renovations for your rental, you may only need a few people. Consider what role a person will fill should you engage them to work on your project.
- Check for licensing and insurance. Before hiring anyone to do your reno, make sure that they have the proper licensing and insurance.
- Shop around. Meet with various firms, contractors and tradespeople to see who best fits your renovation needs.
- Be upfront with your budget. Don’t beat around the bush and tell prospective employees how much you’re willing to shell out for them to be do the work. Letting them know may help them tailor their project for you.
- Be realistic. Not all renos go to plan. Even if you want the best of the best renovation results for your rental property, you may not be able to achieve everything on your wish list – especially if you’re not in a position to go over budget.
Be realistic regarding what renos fit your budget and what doesn’t. It may be ideal to prioritise reno projects that may add to your rental’s value instead of doing renos and updates just because they need to be done.
These steps are simply a guide to make budgeting for your rental’s renovation a bit easier for you. However, it may be ideal to talk to a professional to get more information about the renovation and its costs. Consult an expert who would give a more thorough explanation of creating a budget for your project; it would definitely be worth your while.
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