Skip to Content

Creating a Salt Lake City Rental Property Renovation Budget

Real Property Management Wasatch staff inspecting the sinkTo have the best yield on your rental property investment, you must initiate a constant and lasting property renovation budget. Although properties being rented out do not normally require an entire “flip” modernization, it is of value to be aware where you should allow your property renovation budget to have the heftiest result on the Salt Lake City market in growing the rent value.

Experienced property investors recommend allocating funds for property renovatihttps://www.rpmwasatch.com/areas-we-serve/salt-lake-city-property-managementon on the main features of the property based on the following percentages:

  • Kitchen: 30%
  • Bathroom: 20%
  • Exterior: 20%
  • General Improvements/Other: 30%

After you determine the areas of your property that fall under these percentages, factor in the total worth of the property and take a percentage of it. For example, if you have a $40,000 property renovation budget based on 10% of a $400,000 property value it would look like this:

  • Kitchen: $12,000
  • Bathroom: $8,000
  • Exterior: $8,000
  • General Improvements/Other: $12,000

Keep in mind, each adjustment needs to factor in your target market and what will maximize value for your future Salt Lake City tenants. Create a list of each room and feature of your property and utilize your allocated property renovation budget to find what needs the most improvement (you do not need to use the whole budget).

Some property investors will want to maximize their property renovation budget by redoing the entire kitchen or bathroom; however, it is important to keep costs low as possible and find what needs the most work. For example, you could keep the main kitchen body and just replace the floors, sink and faucet, add new appliances, and paint the cabinet doors or add new handles. Bathrooms can generally stay the same with their walls and layout, but you could place a new shower head or heads, toilet, or vanity based on your vision for a more clean and modern look. If there are items from your property that you do not want to keep, consider utilizing a second-hand market by selling them to have more funds for adding new items. Alternatively, to cover costs, some Salt Lake City investors might buy from the second-hand market or a community online classifieds section to find lower cost items for kitchens, bathtubs, windows, and doors.

Generally, a full renovation with your Salt Lake City property renovation budget will most likely always add additional value. However, overcapitalizing can become a factor, especially when rental values can alter depending on the market. As such, ensure that your budget fits your goals and that you do not perform expensive renovations that are not needed to attract higher rent.

In determining the most important items to focus on with your property renovation budget we have found that these items tend to attract a higher rent value:

  • Updating the kitchen and bathroom to be more modern
  • Adding blinds/window dressings and floor coverings
  • Including privacy features
  • Upgrading outdoor living areas and fencing
  • Ensuring ease of access to rooms
  • Installing natural lighting in the home

The most important factor in renting to Salt Lake City tenants is to have the best presentation that you can to make a positive impression with your prospective tenants that will last even after they decide to live in your property. Additionally, prior to contacting you, potential tenants will often drive by the property itself to view the condition. If they are impressed, then they will contact you for more information. If not, they may move on to the next rental property. As such, curb appeal can help attract and retain quality tenants. An effectively planned property renovation budget will result in careful consideration of all the costs necessary to allocate the right resources and time to what matters most to your future tenants.

Would you like to learn more about the services that Real Property Management Wasatch offers? Call us at 801-418-9835 or contact us online today!

We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.

The Neighborly Done Right Promise

The Neighborly Done Right Promise ® delivered by Real Property Management, a proud Neighborly company

When it comes to finding the right property manager for your investment property, you want to know that they stand behind their work and get the job done right – the first time. At Real Property Management we have the expertise, technology, and systems to manage your property the right way. We work hard to optimize your return on investment while preserving your asset and giving you peace of mind. Our highly trained and skilled team works hard so you can be sure your property's management will be Done Right.

Canada excluded. Services performed by independently owned and operated franchises.

See Full Details