If you are considering buying an investment property, one of the most important things you’ll need to consider is what amenities you want to provide for your renters.
What amenities are renters looking for, and what items do they like to purchase for themselves?
Will adding a few nice appliances allow you to charge much more every month?
Will they help you attract more desirable tenants?
Many rental amenities are not worth the cost and the trouble. We generally don’t recommend providing a lot of amenities unless they make sense for a specific space. In this article, we’ll discuss which amenities renters are looking for and how often you should upgrade the amenities in your investment property.
Why Don’t More Amenities Equal Higher Rent?
Most of the time, cost is the number one consideration for people looking for a rental. People tend to be focused on paying close to the market average for rent. Location and type of neighborhood are also important considerations. Oftentimes, these things are much more important than particular amenities.
When it comes to appliances like washers and dryers, renters are usually less interested in paying more money every month for an appliance that they can’t take with them when they leave.
Also, amenities are a personal preference. You could buy a very nice stainless refrigerator for your rental property; but if a prospective tenant has her heart set on a different look, she may either ask you to remove your fridge, or you may lose that potential renter altogether to a place where she doesn’t have to deal with a preexisting fridge. (Of course, that could go the other way, too. This isn’t an exact science.)
Rental amenities like these don’t necessarily add to the amount you can charge for rent, but they do add to the number of repair requests you have to deal with. Another thing to remember is that people take much better care of things they own.
Amenities That Can Improve Your Rental Price
It may sound like we have a pretty negative view of amenities for rental properties, but that isn’t always the case. There are times when they can add to your rental price. Amenities can be worthwhile if they are things that make sense for your specific property.
For example, if you are renting out a property with a yard, it might make sense to include lawn care in the rental price. It is worth noting that if your tenant wants to do yard work, then you can simply not hire a lawn care company, and save yourself money.
If your rental property is a studio apartment or some other kind of small space that requires a stackable washer and dryer, you might consider furnishing those, because it is less likely that a potential renter already owns a washer/dryer set in that particular configuration.
Another thing you might include is an alarm system. With an alarm system, you could provide the setup, and then the tenant can make the decision whether or not to connect it. In this situation, the alarm system is almost more like a utility.
What Amenities Are a Waste of Money?
I don’t mean to pick on washers and dryers, but again, as nice as it is to have them, they aren’t something that will likely allow you to charge much more in rent. Also, this is another situation where you need to consider the specific area around your rental property. If there is a laundromat nearby, that is even less of an incentive to provide these items.
A few years ago, we had a prospective client who had added a $5,000 water purifier to a property, and he wanted to use that as a reason to charge 20% over the market rate. We turned down his business. That water purifier seemed to be very important to him, but we didn’t believe it was something renters would want to pay for.
If you do add an appliance or other amenity at a considerable cost, you need to be reasonable when considering what you can add to your rate. Pricing yourself out of the market won’t do you any good.
How Often Should You Upgrade or Reevaluate Existing Amenities?
Anytime you have an appliance that needs frequent repairs, do some research to see whether a replacement would be the more cost-effective option. Sometimes, when you replace an appliance with a newer model, the improved energy efficiency helps the appliance pay for itself over time. Look for appliances with ENERGY STAR certification to ensure you’re getting a product that will save you money.
Also, while some rental amenities may not equal higher rent, don’t forget that some simple property upgrades are relatively inexpensive and can really improve the look of your place. There are things you can do to make a kitchen more appealing, including fixing up the appliances or even painting them, and a number of home-improvement projects cost less than $20.
The Best Way to Manage Amenities if You’re Not Local
That’s easy—hire LEAP Property Management to manage them for you! We are happy to discuss amenities for your rental properties. And we will, of course, manage any rental amenities for our clients, whether or not they are things we particularly recommend.