Increasing the value of your rental property
Category Rentals
While property investments tend to appreciate in value over time due to rising prices driven by demand and sales cycles, an astute property owner should also ensure that they maintain the property and update it periodically.
Although it is important to maintain the property and boost its value, it is also important to avoid things which may negatively affect the value of the property and the rental income that you can achieve.
Things which DON'T add value
Too many features and too many bedrooms do not always add value. While each area differs, the norm is usually that a good rental investment apartment should have one to two bedrooms and a house, at least three bedrooms.
Overly modern fittings and finishes also do not add extra value. People's tastes differ and it is always best to keep fittings and finishes as neutral as possible. Invest in quality where possible to ensure durability.
Things which DO add value
Preventative maintenance cannot be underestimated. The property should be clean and everything in good working condition. The property should offer the basics, have adequate cupboards and storage, and preferably offer security including secure garaging or parking.
Keeping the property's finishes updated is also important. Outdated properties typically achieve lower rentals compared to those with updated features. It does not necessarily need to be in keeping with the latest renovation trends, as long as the finishes are not outdated.
Pet friendly properties are increasingly in demand. While it is not always possible to allow pets, where possible, this could add value, especially in view of the significant increase in pet ownership.
What affects rental rates?
Location and demand for particular types of rental properties in the area plays a big role. The more in demand, the higher the rental that you could normally charge, and the more valuable your property is likely to be.
Most areas also have price brackets and a price ceiling. For example, a similar luxury home in one area may achieve a higher rate compared to another area. Avoid a property which sits at the top end of the market because it will appeal to fewer tenants which can be risky because you could sit with periods when the property stands empty.
It is therefore best to ensure the property offers the right location, accommodation and finishes. Adhere to best practice advice from rental agents. They usually offer experience built up over many years, and a focus on particular areas.
______
Make sure to follow us on Facebook, Instagram, and LinkedIn for the latest tips and trends in the property industry, as well as some of the most relevant news about the area you call home.
Author: Gina Meintjes
