Renovations to Maximize Your Rental Income in New York City - Article Banner

Standing out in a crowded and competitive real estate market in New York City isn’t always easy. Your rental property can seem like just another unit. You need to give your prospective tenants a reason to rent it. You also want to increase the value of that property and earn as much as you can in rental income. 

What can you do to meet those goals? 

One of the best ways to increase what you earn on your Manhattan rental property is to make renovations that will raise your rental value and increase your income. You’ll also keep your vacancy loss low and attract the best possible tenants in the market. 

You want to make your rental property irresistible. You want to justify the price you’re asking. 

This isn’t as difficult or as expensive as it may sound. 

We’re not talking about total rehabs. If your rental property is well-maintained and in good condition, you should be able to make some simple and cost-effective upgrades and updates that will make a huge difference. 

Consider some of these renovations. And don’t forget why they’re so important. 

Renovations Maximize New York City Rental Income and Protect Your Investment

Why bother with all this? You’ll find a good tenant eventually and collect the rent you need. 

Think bigger. You can push the income you earn in rent a little bit higher and you don’t have to invest too much time or too many resources to do it. A New York City rental property that has been recently renovated will earn more rent in the short term, higher ROI in the long term, and ultimately attract better tenants. 

The fact that your renovations will reduce vacancy and turnover costs is often overlooked because we’re always more excited about higher rents. But these are extra benefits – you’ll lose less money when you keep tenants. Renovated, modern properties contribute to tenant retention. 

Upgrades and improvements can be cost-effective. They’re often cosmetic. There’s no need to take down a wall or add a garden tub. Focus instead on affordable updates that are likely to increase the value of your property and the likelihood that it will be snatched off the market as soon as it starts showing. 

Another benefit? Upgrades and renovations can also help with preventative maintenance. You’re giving all those major and minor systems some attention. Maybe you’ll notice something that needs closer inspection. You could be saving yourself thousands of dollars if you notice something minor before it has the chance to become a big, messy, expensive emergency repair. 

Now let’s look at the upgrades and renovations that make the most sense.

Fresh Paint Is a Requirement in New York City

A lot of the New York buildings in Manhattan and below 34th Street are older. They’ve been upgraded and modernized, but they’re still in need of ongoing TLC. 

It starts with the paint. Evaluate the condition of your walls. A property that earns high rents has walls that are sturdy, clean, and modern. They should be well-insulated and painted in neutral colors. Avoid outrageous things like pink paint in the bedrooms or wood paneling in the living room.

You might think about paint as a basic turnover expense and not a renovation. Actually, it contributes to your property value and your ability to attract great residents. This is a cost-effective improvement that can easily be used to improve rental amounts and the value of your property. Paint the walls completely during every turnover, and if you’ve had the same tenants in place for years and the walls are looking worn and faded, schedule some time for repainting. 

Avoid the touch-up. A completely painted wall will give new life to your property. 

Invest in high quality paint that will last longer, and remember that there’s more to painting than the walls. A fresh coat of paint on your baseboards and door frames will make the rental home appear refreshed and clean.

You Shouldn’t Have Any Carpet in Your New York City Property

Carpet is no longer appealing to many tenants, and it’s ugly and difficult to clean. 

Strong words, but true. 

Tenants often move into your property with children and pets. The carpeting on your floors will undoubtedly carry allergens and odors. Stains will be nearly impossible to remove. 

If you still have carpet on your floors, think about hard surface flooring instead, especially in common areas like hallways, living rooms, dining rooms. 

Hardwood floors would be great, but you can also work with tile and even laminates and faux woods. Even some types of vinyl look great and don’t cost a lot. These floors will increase your earnings because they’re cleaner and easier for tenants to maintain. You’ll also have a longer lifespan, which means you won’t be cleaning and replacing carpet every year.

Kitchen Renovations Deliver ROI and Higher Incomes

Kitchens are really the heart of most homes, even if your kitchen is small. 

This is the space that carries a lot of value when it comes to setting a rental price. Most tenants want an open kitchen with counter space, storage, and matching appliances. They won’t be willing to pay higher rents if your kitchen has mismatched, deteriorating sinks and refrigerators. You can make the most of a small kitchen space by upgrading to attention-grabbing faucets and new hardware. Energy-efficient appliances are a great idea, especially if yours are often needing to be fixed or looking old. 

Consider a backsplash against the kitchen wall, near the stove or sink. It looks modern, tasteful, and expensive – even if it’s not. You don’t have to use marble tiles, but something like plain white tiles or glass will not only improve the look of your kitchen – it will also protect your walls. 

Don’t forget the lighting. If your kitchen doesn’t get a lot of natural light, install lighting that really casts the right mood. Tenants want to see what they’re doing when cooking and cleaning. 

Bathrooms Renovations Cost Almost Nothing

For a really great value, turn your attention to the bathroom. How can you renovate a bathroom in a rental property? Sure, they’re small. Sure, they serve some very specific purposes. But, tenants who love their bathrooms are tenants who will renew their lease agreements year after year. 

So make them more attractive to your ideal tenants. Change out any mirrors and lighting that make the place look dated. The shower and tub need to be in good condition, and a low flow toilet is not terribly expensive to install. All these things will result in higher rents. 

How To Approach Your New York City Rental Renovations

Kitchen AppliancesIf your rental property is already in generally good condition, you can focus on making strategic renovations that will have an immediate impact on rental value and ROI without spending too much money up front. For example, there’s no need to gut and remodel a kitchen when some updated appliances will do. 

Focus on the improvements that won’t cost very much or take very long. 

Think like a tenant. What will really matter? What will they be willing to pay more for?  

Perhaps when you think about renovating your own home, you imagine marble floors or a built-in wine cellar. 

Those sound great, but they’re pricey. And, tenants in New York City like a bit of luxury but what they really want is value. Think about the value of in-unit laundry. What tenant wouldn’t pay more for the luxury of washing clothes in their own unit instead of in the building’s basement? 

Fixtures and appliances will also get the attention of tenants. Instead of replacing an entire bathroom, simply upgrade the lighting and the faucets. Install a modern mirror instead of the large glass rectangle that’s typical in rental homes. 

Tenants know what to expect from New York City rental homes. You don’t have to go overboard. Surprising them with these small, modern upgrades, however, will go a long way. 

You need to plan your renovations carefully, too. Put together a budget and a timeline. Who will do the work? 

Renovations are best done during tenant turnover periods. You get the benefit of an empty property and you don’t have to work around tenant schedules for your vendors and contractors to come and go. You don’t want to spend too much time on them, however, because a vacant property that’s under construction does not earn you any rental income. 

Get your best vendors and contractors lined up well before your intended start date. Set a budget and stick to it. Use durable materials that are more likely to last for many years, so you can avoid renovations every time you turn the property over. The longer the lifespan of any improvements, the more profitable you’ll be. 

The renovations that will work best for you will depend on your property and what you’re hoping to gain from them. We’d be happy to make some personalized recommendations. Please contact us at Krieger Property Management. We’re a full-service property management company in lower Manhattan serving SoHo, West Village, Greenwich Village, Tribeca, and Chelsea.