Top 5 Apartment Upgrades to INCREASE Revenue

Top 5 Apartment Upgrades

What’s up folks, Chris Kennedy here with Mayfair Real Estate and Mayfair Property Managements here in Fort Lauderdale, Florida. And this is a second video in a two-part series that I’m doing on things that you can do to increase the revenue at your multi-family apartment building. And remember just to summarize, there are three ways that you can do that.

Number one, you can increase your rents. Number two, you can increase retention or reduce turnover, in other words, make sure as many residents as possible renew their leases. And number three, you can reduce the days on market for vacant units, in other words, improve your leasing process or increase your leasing efficiency. So those are three things that will actually increase your revenues. So what are the things specifically that you can do to make those things happen? And in this video, we’re going to talk about in unit specific upgrades or improvements you can make.

So in the last video we talked about things you can do to the exterior of the property. In this video, it’s specific to individual units. So let’s jump right into it.First and foremost, real easy, go ahead and upgrade your appliances to stainless steel appliances. Now you might say, “Hey, hang on Chris, I’ve got white appliances that are perfectly functional. They work. I don’t need to change them out.” And maybe you don’t have to but I will tell you, if you go ahead and upgrade to stainless steel appliances, you will turn your units faster, people will rent them quicker and you’ll get a little bit more rent.

I didn’t believe this myself until I just saw it time after time, after time in our own leasing activity, people just want stainless steel. Whether it’s a budget apartment, lower income working class neighborhood, people still want those nicer appliances. And nowadays the difference in costs between a budget stainless steel range and a white range, it might be 50 bucks. So don’t cheap out on the white appliances, go ahead and upgrade to stainless steel and you will get more rent and quicker turnaround of your units when you’re trying to lease them.Okay.

The second thing you can do a little more costly but definitely almost always worth the investment unless you’ve got a nice kitchen already is to obviously upgrade the kitchen. So this can be from as simple as spending a couple of thousand dollars on just replacing the cabinets, leaving the layout the way it is. But if you’re going to do this, take the time to look at the kitchen layout and figure out, are there ways to make the kitchen more appealing where people will pay more rent for it.So what are some things there that might improve your kitchens?

A simple thing, if you can figure out a way to put in a breakfast bar, especially if you’ve got one bedroom or efficiency units and you’re going to put a breakfast bar in there that will save potential residents space. Because now when they come to tour those apartments, they’re going to be looking around like, okay, there’s a breakfast bar there, I don’t need a dining table. So therefore I have more space for other things. So you’re solving a problem for them and you’ll rent the unit faster, and people just like to have a nice breakfast bar in their kitchen, maybe put a couple of pendant lights and all of a sudden you’re getting a little bit more rent as well.What else can you do in the kitchen to improve the layout? Well, along the same lines would be if the kitchen is enclosed or kind of separate figure out a way that you can open it up to the main living space.

Nowadays, people like having kitchens where they can also be talking to their friends who are over hanging out. So getting an open kitchen concept is a great way to up the perceived value of that apartments and increase your rent. Now, depending on your plumbing, electrical, all that, that could be quite expensive so you obviously don’t want to invest more money than you need to. You want to do your numbers, make sure the investment you’re making is going to pay for itself in a relatively short amount of time, but just giving some ideas for you on the kitchens.

The third item that I put on this list is regarding bedroom count. Now I might say, how can I adjust the bedroom count? And we’ve done this a number of times and typically in single family rentals, but also occasionally on larger apartments. So what happens is obviously people will pay more rent for an apartment that has more bedrooms. So what is a bedroom? A bedroom is simply a room with a closet and a window. Okay. Now where is a quick value add that you can get? If you have in your house or apartment a room that has a window but has no closet, you can go ahead and put a closet in there and now it qualifies as a bedroom. This works amazingly well with section eight type properties.

So not to get into too much detail here and go off on a tangent, but section eight vouchers pay based on the number of bedrooms in a home. So if you’re in a section eight area, you’re open to receiving section eight applications, then you can upgrade from maybe a two bedroom with a den to a three bedroom home. And now all of a sudden that you can qualify that property for a three bedroom section eight voucher, and this can increase your rents by hundreds of dollars per month. So well worth the effort to do it. It’s usually very inexpensive. So just something to be on the lookout for.

Christopher Kennedy

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