An answer to that question, is that a rental property should be placed into the condition that will get a better tenant, and sooner and one who will pay you more rent; as long as the money invested to do so doesn’t exceed the costs to do so. So add up the possible cost of being vacant longer, add the increased rent you can get for a better presented property, take into consideration that nicer seeming places keep tenants longer (thus reduce costly vacancy) and add the cost saved by having a better quality tenant that will hopefully reduce expenses by taking better care of the property. Hold that rough estimate in your head as you read through the following guidelines.
A Rental Property Needs to be Clean
We require exiting tenants to leave a property in rent ready condition. In the Philadelphia rental market, an incoming tenant should expect a rental property to have a level of clean associated with a professional level cleaning. No trash, or personal belongings, appliances should be completely clean, all components of the bathroom, windows cleaned and no dust. In other words the property must be fully cleaned by the tenant so we can pass the property to the new incoming tenant in an expected level of condition. Its paramount that we show a new tenant the condition we expect the property to be kept in, if we are to expect them to care for it. If the property is missing any level of cleanliness we typically will deduct the costs of righting the property from the security deposit.
This is also the single most important thing that can be done to increase rents and rentabily. Tenants, home buyers and property appraisals love clean. It’s the thing we value the most and we can almost assign a high dollar amount to this. Obviously, a clean rental property will rent faster and for more rent so it’s important to have this done immediately upon entering the Philadelphia Rental Marketplace.
Painting & Patching
The cleanest you can get a property is fresh paint. Painting is often an investment that rarely doesn’t pay off. Meaning, property owners tend to get far more money after after painting than it will cost them. With some properties we deem the the paint to be in good enough condition and recommend doing nothing. In most properties we end up having to recommend inexpensive mild patching and touch up painting. Touch up painting, is typically where we can use left over paint, or when we know the exact paint color and brand, and a small amount of paint can be used to touch up any poor looking spots (dings, holes, grime). At times we will recommend color matching if we don’t know the exact paint color.
Paint touch ups are never as perfect as painting the complete wall. Typically we can successfully do touch ups with flat paint and we when have the paint color. Results go down the more of a sheen the paint has, if we aren’t using paint from the same can as what is being painted. When forced to do color matching, the results can begin to get more questionable and the touch-ups can be more readily seen.
Some properties should be painted. Again, the question always comes from an investment perspective, will painting make you more than it costs you?
When we paint select paint colors there are a few things we keep in mind:
- Neutral colors are best. We have no way of nothing what color schemes an incoming tenant might have and your rental property needs to be compatible with all colors and styles. Or at least, as many as possible.
- When painting a similar, or even the same color, the costs will go way down. The painter doesn’t need to be as precise when painting edges and it can be done in one coat.
- Ceilings and floor rim don’t always need to be painting. Ceiling paint is less expensive than wall paint; but the cost of labor is there. In some cases we recommend only the walls to be painted, which saves considerably.
Like with cleaning, and other damages to a property, we often will deduct appropriate amounts from the security deposit if the leaving tenant has exceeded the legally allowed Normal Wear & Tear. Paint does fade and Normal Wear & Tear includes mild rubs, nail holes and similar things that happen in everyday life. The longer a tenant has possession of a property, the more wear & tear needs to be allowed.
Fix What is Broken
A tenant rents a property “As Is”. Meaning, anything that a reasonable person could have seen, or should have seen, before entering into a lease agreement became there decision to rent or not to rent. So it isn’t something we would necessarily change. For example, if a tenant moves into a property and finds there isn’t a great place to hang their bath towel and wishes there was a towel rack. This isn’t the property owner’s responsibility as a reasonable person should have seen that during a showing.
But if a tenant moves in and finds a burner on the stove isn’t working and they weren’t informed before signing a lease agreement, this is clearly something that would need to be fixed.
So the things that have to be fixed should be fixed; but also those things that will increase, or protect your investment should also be fixed. When we look at a rental property we are always looking at money. “What are the things we can do that will cost less than a future expense?” “What are the things we can do that will increase profit more than they cost?”.
And we also need to demonstrate to the new tenant how they should care for the property. Cared for properties are cared for by tenants. Neglected properties are abused by tenants. When I see a neglected rental property, I see a lazy owner that hasn’t taken the time to care for their property and one who hasn’t learned even the basics of property investment math. Tenants exploit uncared for properties.
These are some must fix items:
- Replace bad light bulbs. This is something that most of us would expect as a tenant renting a property. And burned out bulbs show a property badly to prospective tenants.
- Clean up outside spaces like a yard, alley and front of the property. Doing so will get you a tenant quicker and will get you more rent; but this also has a protective component for your investment. Weeds have roots that works hard to damage concrete, Concrete can work as a block from rain infiltration into the home. Roots create openings, water gets into the opening and freezes. Once frozen water expands the hole even larger and the cycle continues.
Additionally the City of Philadelphia requires a property to be within certain conditions before being rented and it doesn't matter what a lease states, the city will not allow repairs to be at the tenant's expense. A property owner is responsible to make certain repairs to the property. A lease implies a warranty of habitability to the tenant.