5 Top Tips for Buy to Let Property Renovation
The buy to let property market has experienced a strong start to 2016, a trend that has been amplified as investors rush to beat tax changes for second homes that will be introduced from 1st April.
Buy to let properties come in all shapes and sizes and in order to ensure the best possible return on your investment, and attract high calibre tenants, it may be necessary to carry out some renovation works before marketing the property for rent. We have compiled 5 of our top tips for investors considering a buy to let renovation project.
The first step for any would be investor is to research, research, research. Make sure that you know the market that you are buying into inside out including; demand for particular properties, likely groups of tenants, and desirable areas.
It is also important to be realistic in terms of your budget and the timescale required for the works. For example, if major structural renovations are required the timescale for the project will increase. Can you afford to factor in this additional time before seeing a return on your investment?
Top tip: Be realistic – outline a sensible budget at the beginning and aim to stick to it.
Finding the right contractors can be difficult and time consuming, especially if this is your first project and you do not have contacts in the area. We would advise going on word of mouth recommendations from trusted sources, and also viewing examples of work where possible.
Most contractors will provide quotes free of charge; get 2-3 quotes for each part of the job so you can ensure that you are getting the best possible price. Although it is important to get value for money, especially for a buy to let property, quality of work should always be top priority. After all, if a job is not done properly it can end up costing more money to fix further down the line.
Top tip: Try to find a contractor who can undertake as many of the different elements of the project as possible. These tasks will most likely be subcontracted out, meaning easier coordination between contractors and one point of contact for you
3. Add value
When marketing a property for rent the aesthetics are important, especially as the first contact a potential tenant will have will most likely be through online marketing pictures. Many visual improvements that will help to increase the potential rental value can be made without significantly adding to the overall cost of the project, for example
Tidying garden/ outside space
Repainting interior and exterior doors
New window dressings
Upgrading kitchen cupboards with new doors and handles
Top tip: Choose a bright, neutral colour such as white for the internal walls. This lightens the property and, if all walls are the same colour, means that any touch-ups in the future will be simple.
4. Furnished or unfurnished?
One questions that most new landlords ask is whether they should provide the property furnished or unfurnished. This varies from market to market and depending upon the type of tenant that you are hoping to attract. It is important to have a clear idea of your prospective tenants before rushing to furnish the property.
In Edinburgh we find that there is a greater demand for furnished properties, however, as the rental sector is growing more and more tenants are purchasing their own furniture and renting long term. These tenants often pay comparable rent to those in furnished properties and often stay in the property for longer, meaning lower costs for landlords.
Top tip: If in doubt keep the property unfurnished and gauge how it is received on the market, furniture can always be added before the tenant moves in if required.