You asked, and Scott McGillivray’s answered! Read on for the latest in our “Ask Scott” series, where the income property professional weighs in on your most pressing real estate related questions.
HGTV Canada Instagram fan Omotara asked, “I only have a small budget to renovate my rental property. Where should I focus my money? Flooring and paint? The kitchen? Or the bathroom?“
The simple answer to your question is…yes, you should focus on all of these things.
Your list of priorities will depend on the condition of the house, but as a general rule you’ll want to focus on the kitchen first, then the bathroom. These are the first rooms people look at and they’re the most valuable in terms of return on investment.
Just make sure to create a realistic budget before you start so that you know how to allocate your money.
- Cabinets – Most of the kitchen cabinets I come across in fixer uppers aren’t in great shape and need to be replaced. It’s usually worth the money, but if the cabinet boxes are fairly sturdy you can save yourself a ton of money by painting them and either replacing or refacing the doors.
- Appliances – Although it’s great to put in new stainless steel appliances when you can, if it’s not in the budget don’t worry about it. As long as you’ve got clean appliances that are in good working order you’re fine.
- Countertops – I love a nice, stone counter, but by no means is it a necessity. Laminate, butcher block, and other inexpensive materials are all perfectly good options for rental properties.
- Lighting & Hardware – I would recommend investing in decent lighting – pot lights, under cabinet lighting, and a stylish overhead fixture. You don’t need to spend a ton to make it happen and it makes a big difference in the room. So does hardware. You should update whatever’s there with something that’s modern and fairly high quality.
- Vanity – In my opinion a vanity with storage is a must-have in any bathroom – rental or otherwise. If you have a pedestal sink I suggest replacing it with a vanity that has a couple of drawers or shelves, and a surface area that’s big enough to hold things like soap, a toothbrush, etc.
- Tile – Nothing screams ‘old and neglected’ like grungy tile and stained grout. If it looks ok leave it, but if it looks dated I really suggest looking into what it would cost to replace it. You don’t need something fancy – a simple, inexpensive subway tile will do the trick.
- Fixtures – Toilets and tubs aren’t big ticket items when it comes to adding value. Unless they’re really gross or leaky, leave them.
- Lighting & Hardware – Just like in the kitchen, it’s worth spending a little cash on updating these items.
Worried about your reno budget? Read Scott McGillivray’s list of red flags that you’re about to lose money on your income property.
Flooring is tricky because it really depends on your budget and the state of the existing floor. If you can salvage what you’ve already got, then do so – particularly if it’s hardwood. If you’ve got carpet, get rid of it and think about replacing it with a laminate or luxury vinyl plank. I rarely recommend carpet in a rental because it gets dirty, grungy, and needs replacing more often than other types of flooring. Another type of flooring I recommend replacing if you can swing it is any type of dated tile, sheet vinyl or linoleum. The reason I suggest it is because when people see these old, out-of-style floors it signals to them that updates haven’t been made, and it gives the entire place a slightly neglected feeling. If you want to command the highest rental price you want something that looks as clean and new as possible.
Without a doubt, paint is where you’ll get the best bang for your renovation buck. So give the whole place a coat of paint, even if you already like the colour. A fresh coat will get rid of any dirt or marks and give everything a nice, new look. And no matter what colour you like best, I highly recommend a light neutral such as white or light gray. The great thing about painting is that as long as you’re willing to do the work yourself, you won’t need to spend more than a couple hundred dollars. It’s the best way to make a big impact for a very low price.