6 considerations for renovating your buy-to-let
Renovating your buy-to-let property could potentially increase your revenue – but it could also be more hassle than it’s worth. Here are a few factors to consider when deciding whether to invest.
1. What are the market conditions like?
Find out whether house prices are rising or falling in the local market, as this will affect demand for rental properties. You should also talk to your letting agent to find out what you could potentially charge following renovations.
2. Who is my ideal tenant?
When deciding whether to renovate, it’s worth considering who you want to appeal to. If your property is near a school, for example, you could try to appeal to families seeking an un-furnished but secure home.
3. Which renovations will improve my income?
After deciding on your target audience, you can look at ways to make your property more attractive or more profitable. For example, if you’re targeting students, keep the property simple but consider extensions that will let you accommodate more tenants.
4. How long will the renovations take?
Every day your property isn’t occupied by tenants is a day that you’re losing money, so factor in the time your renovations would take. A loft extension can take as little as six weeks, while a rear or side extension can take up to 18 weeks. To find out about the requirements for different types of renovation, use the Hiscox renovation planner.
5. What are the potential maintenance costs?
Consider the cost of maintaining any newly renovated features. For example, power showers may need intermittent maintenance, and carpets will need to be replaced fairly regularly.
6. Does it all add up to profit?
Look at all the figures carefully before making a decision. If your potential renovations could bring in more money, that’s great – but remember to consider the costs of the renovation along with additional overheads like insurance, maintenance and agency fees.