How To Prepare Your Rental Property For Tenants
You’ve finished the home buying process and your property is now financed and insured.
It’s almost ready for tenants and a brand-new lease term.
Before you can start collecting rent, however, you need to prepare your rental property for your tenants’ arrival. This means inspecting, renovating, making repairs, cleaning, and staging.
Your task list depends on the condition of your property when you bought it. Was it generally in sound shape? Or is your property a fixer-upper with substantial problems and damages?
You’ll also need to consider what your future tenants want and need. What are renters in your area looking for? Do they want the newest technology and amenities, or is affordability their priority?
As a new landlord, preparing a property can be overwhelming, and we’ve prepared this article to help you out. Here are a few steps to prepare your new rental property for tenants.
Tenant Wants and Needs
In a short while, you will move in your first tenants. Your new residents are entitled to certain amenities by law, namely standards of “habitability.”
This means adhering to health and safety precautions and preparing a habitable home. At a minimum, your tenants have the right to a clean and safe dwelling, adequate living space, reasonable privacy, working appliances, and functional utilities.
Other features—like technology or laundry facilities—are not obligatory but always appreciated. Renters often want convenience, modernity, and affordability, plus a generally pleasant living and working atmosphere. It’s up to you to decide what these values look like in your business.
Inspecting Your Property
Before making any changes to your new property, get a thorough professional home inspection.
A home inspection is an examination of the condition of a real estate property, usually when it is on the market to be sold (often there is a home inspection contingency built into the purchase agreement) or being prepared for new occupants. Inspections are generally conducted by a professional home inspector who has a certification to perform such inspections. The inspector creates a home inspection report and assesses any repairs, issues or concerns.
Certified home inspectors will complete a comprehensive review of the property and all its major systems—structural, mechanical, electrical, plumbing, ventilation, and fire alarm and suppression systems. Your home inspector will also evaluate whether the property meets all health and building codes.
The following items are sure to be on their home inspection checklist:
- Roof quality and condition
- Electrical outlets and wiring
- Appliances
- Lighting
- Generators
- Sound and security systems
- Heating, ventilation, air conditioning, and refrigeration (HVAC system)
- Boilers and gas appliances
- Water quality
- Sanitation and waste disposal
- Structural components and integrity against engineering and environmental stressors
- Potential fire hazards
- Any other safety issues or significant repairs needed
Address any urgent concerns first, such as structural insufficiencies, water damage, mold, or other contaminants. Screen and hire trustworthy contractors for these tasks to make sure they’re done right; the last thing you want is a botched job endangering the wellbeing of your new tenants.
Lastly, write down the dates and agendas of all home inspections to file with your records.
What does a home inspection cost? You can expect an average home inspection to cost anywhere from $300 to $450, although prices will vary by location, size/type of property, and other factors.
Repairs
Now that you’ve had your property inspected, it’s time to make the necessary repairs.
At this stage, focus on preventative maintenance and minor repairs. Your goal is to ensure all appliances and systems are in ordinary, working condition.
Here’s a shortlist of potential repairs:
- Repair cracks and dents in the drywall
- Fix hinges on doors and cabinets
- Replace or add window dressings
- Refresh insulation
- Test smoke alarms and carbon monoxide detectors; replace batteries
- Fix or replace window and door locks
- Remove any pests
- Refresh water fixtures
Bonus Tax Tip: Delay expensive repairs until after the property is officially “in service” (when you’re actively seeking a tenant). Repairs made before the property is ready to rent are not currently deductible. Instead, these costs are added to the building basis and depreciated. You’ll save more money on taxes by waiting a little longer to deduct the costs in full.
Improvements and Renovations
Next, decide whether there are any major home improvement projects worth perusing.
Focus on improvement projects with high returns. High-value projects like kitchen or bathroom remodeling increase the cost basis of your property and boost rental appeal, which means you can charge more rent.
High-value improvement projects are also advantageous if you plan on refinancing your mortgage in the future. After completing the projects, get your property appraised. If the appraisal value is significantly higher than the amount you invested, you can use cash-out refinancing to access your home equity.
Other improvements with a high return on investment (ROI) include installing hardwood flooring and opening space by knocking down walls.
Construction
You might want to expand your property in some way. For example, you could add bedrooms or other permanent structures like pools, sheds, garages, patios, decks, balconies, or walk-in closets.
While construction occurs, your property is especially vulnerable to weather damage. Consider buying construction insurance as an add-on to your regular landlord policy.
Landscaping and Curb Appeal
Your property’s exterior needs as much attention as the interior. Now is the time to spruce up your curb appeal, or its outside attractiveness to passers-by.
Start with landscaping. Shape and mulch flower gardens, pull weeds, and trim branches. Clean all gutters and clear any debris from the yard.
Don’t forget to add something green to your properties. Choose drought-resistant plants for year-round curb appeal, especially in hot climates. If your properties have substantial yard space, choose a low-maintenance grass seed like a no-mow or low-water variety. This will help conserve water by avoiding installing sprinkler systems. Plus, these varieties rarely require lawn maintenance, which saves you the time and energy of mowing or the cost of hiring someone else to do it.
Finally, be sure the building exterior looks polished. Power wash the siding, sidewalks, and driveways. Then add finishing touches, such as a window box or freshly painted front door. These small details can pull the entire property together, especially in bright colors.
Cleaning and Painting
Every newly acquired property needs a deep cleaning.
Cleaning rental properties involves throwing away any old or dirty furniture and clearing the rooms of unnecessary items, so you have space to clean carpets and polish the flooring.
Once you’ve removed all the dirt and debris, add a fresh coat of paint to any rooms with scratches or chips. Painting with warm, neutral colors will brighten and refresh the living space. Don’t forget the trimming and doors, then let the paint dry for at least 24 hours.
Installing Technology
Technology increases the value and appeal of your properties. Students, young professionals, and tech-savvy renters are especially on the lookout for digitally equipped properties at affordable rates. Technology can help you attract a high volume of applicants.
Home technology can also help conserve energy, reduce environmental impact, and secure your units.
Energy-Efficient Appliances
Energy-efficient appliances like convection ovens, low-flow water fixtures, and water-conserving washers are great additions to your property. They conserve resources and lower your tenants’ utility bills.
Smart Thermostats
Smart thermostats auto-adjust the heating or air conditioning in your property. The temperature stays comfortable but optimal throughout the day.
Smart Lighting
Smart lights turn themselves off when your tenants forget. No more astronomical electricity bills.
Smart Security
Smart security devices protect your property, your tenants, and their belongings from theft or criminal activity. For example, video doorbells are motion-sensitive and start recording when they detect someone approaching. Smart locks allow tenants to lock or unlock their units from their mobile devices.
Staging Your Property for Showings
The hard work is done. You’ve meticulously cleaned, repaired, renovated, painted, and maybe even invested in technology for your property. Now you’re ready for the finishing touch—staging your property.
Your new applicants will likely want to tour the property before signing a lease. Prepare your property for showings by carefully placing furniture and paying attention to subtle appeals like scents and lighting. Your real estate agent can assist you with these tasks to ensure your property is as appealing as possible.
Here are a few tips for staging rental properties:
Style and Place Furnishings
If your unit is furnished, choose furnishings that work well with the paint colors and reflect the location. For instance, a property near the coast might feature wicker chairs and beach décor, while a property downtown might feature simple, modern furnishings.
Accessorize, But Avoid Clutter
Your property should feel comfortable and homey. Accessories like books, towels, dishes, or plants give your units a lived-in feel. However, don’t go overboard—extra clutter makes rooms feel disorganized. Give your potential renters a chance to fill the space with their imagination.
Emphasize Your Property’s Best Features
Does your property have a great view, built-in bookshelves, a unique storage area, or walk-in closets? Emphasize these features and others that make your property unique.
Get the Air Flowing
Your property should appeal to all the senses. Be sure to open windows and turn on lights or fans before welcoming renters inside.
Conclusion
Preparing your rental property for new renters is an exciting step in your real estate investing journey. Whether you stick to basic safety and repair tasks or go all out with décor, you’ll be in great shape. Before long, you’ll have created a space your new renters can call home.
