Once you’ve identified your investment property in New Jersey, with the help of a local, knowledgeable NJ real estate agent, you will need to renovate it (most likely as there are few properties that are in ready-to-move-in condition). Undertaking a full assessment of the property will allow you to decide the essential works that are required. If you will be marketing your investment property at a higher rental rate, then you will need to add high-end fixtures and fitting to reflect the extra cost.
Decide On Your Budget
The first thing you need to be aware of is the budget. There is little point investing in a property, only to find you have no money left to update it to the standard you want. Therefore, before bidding at auction or buying a property, work out your figures in-depth. You will need to keep a tight rein on your money, as it can be very easy for your heart to overrule your head when it comes to spending. Just a bit extra here and just a bit extra there can add up to a lot more than anticipated at the end of the project.
You can allow a 10-20% buffer for unexpected charges, but the main budget should consider all essential work, fixtures and fittings. You may have to increase the rental value to recoup any extra charges. If you need to do this, you may be waiting longer for the perfect tenant. By sticking to your budget and marketing the property in the same market value of other properties in the area, you are likely to get a tenant fairly quickly.
It’s All About Profit
In order to gain as much profit as possible, you need to ensure the materials you source are of good quality, but at a reasonable price. Do not choose the luxury fixtures and fittings as you are unlikely to see any return on this from a rental market. However, classy, well chosen fixtures and fittings at a reasonable price will ensure you can charge a little more rental for the property and they will last longer than inferior, cheaper products.
What If Tenants Are Still In The Property?
It may be that you already have tenants in a property, but you need to bring it up-to-date or replace worn or damaged fittings. Tenants are more than likely happy to continue to live in the property whilst you are renovating around them, as long as it is not too disruptive to their lives. If people are out working all day, then most of the work can take place during the day. However, if you need to change the design of the bathroom or kitchen, you will need to ensure your tenant has some kind of working amenities to come home to.
If you do need to carry out renovation work on your investment property, then ensure you give your tenants plenty of notice. If you are aware of how long the work will take, also give that information, as they may prefer to stay with a relative whilst the work is being carried out. It is normal to give around 60 days’ notice for best results.
Kitchens And Bathrooms Sell Dreams
If you are renovating a property that you are looking to rent out, then pay special attention to bathrooms and kitchens as these communal areas are considered one of the highest attractions that potential tenants look for. They do not have to be high-end fixtures, fittings and appliances, but as long as they are modern and functional, then they are likely to be attractive.
The Exterior Of The Property Also Needs Attention
Although many renovations tend to focus on the interior of a property, the exterior of a property can make or break the deal for many would-be tenants. Ensure the outside is clean and tidy and any grassed areas are neatly cut.
