If you combine the GDP of the two largest economies in the world, you’ll get close to $50 trillion. That’s also the combined value of the US housing market as of 2020. With the trend pointing upwards, real estate is where the basket where investors should put their eggs.
If you want a piece of the $33.5 trillion cake, then the best time to get it is 2021 when everything is looking up. That means it falls on you to increase property value so you can rake in the profits by 2021.
Real estate is more than just buying the right property at the right time and waiting for the price to shoot up. Any serious investor must put in a considerable amount of effort into increasing property value. Because as much as housing trends are predictable, nothing in real estate is guaranteed.
In this post, we’ll be highlighting a couple of ways on how to increase property value every real estate investor should know.
1. Invest Wisely
The first mistake most real estate investors make is buying property blindly without doing enough research. The first and most important step of real estate investment is buying the property. Your property sets the tone of your entire real estate venture and could make or break your investment.
As such, you need to be more careful about the property you invest in. Make sure you invest in property with promise. Even if you’re buying property to improve and sell later on, you still have to take into account whether it’s appreciating or depreciating.
Look for properties that sell way below their worth. That way, you’ll force an appreciation to the property’s worth before adding your profit. Don’t go buying property blindly, but instead look for the best deal you can find.
2. Lower Your Maintenance Expenses
Buying property doesn’t mean you can kick your feet up and wait for the money to pour in. There’s a lot you have to do to keep your property in pristine shape. For instance, you must organize for garbage disposal and make sure the sewer and plumbing systems are in good working condition.
All these services run up your tab, especially in the long run. If you can negotiate a good deal from the service providers, you can save a bundle in maintenance costs. You can then use the money you save to improve aspects of these utility systems.
For instance, you can replace the dripping faucets or buy larger trash cans for better plumbing and easier garbage collections. These tiny improvements go a long way in improving your property’s value.
3. Break the Walls Down
Don’t be afraid to tear the walls or half the walls down for a more modern open house concept. However, be careful with which walls you tear down. If you tear down load-bearing walls, the entire house could come crumbling down.
That’s why it’s a good idea to talk to an engineer before tearing down any walls. Also, consider talking to an interior designer to bring out the best designs for the property. The right people could help you increase the aesthetic appeal of your property with a chic modern concept.
Tearing down the walls doesn’t cost a thing, but it could increase your property value by a considerable margin.
4. Rent out Those Extra Spaces
If you own rental properties, you need to get the most out of them. That means renting out all the living quarters and extra spaces too. That way, you can get maximum income from your rental property and raise its value.
These extra spaces mean areas like storage sheds, multi-car garages, and such like. Renting out these extra spaces could increase your monthly income, which increases the value of the property. Rental properties are a gold mine if you play your cards right.
5. Work on Curb Appeal
Most real estate investors would gladly pour money on interior décor and other aspects of home interior. One small area that they overlook is the curb, even though it’s the first thing any prospective buyer sees when entering your property.
If you want to increase your property’s value, then the curb is the perfect place to star. A fresh coat of paint is a simple and inexpensive way to increase your curb appeal. If you want to blow your clients away, however, then a manicured lawn is just what the doctor ordered.
If you couple manicure lawns with proper landscaping, then the property value can go through the roof. Manicuring lawns and landscaping are costly investments, but they have excellent ROI.
6. Increase Your Rent
If you own rental properties, one simple way to increase their value is by raising the rent. However, note that you can’t just increase the rent by whatever amount you like. If you increase your rent by too much, no one will want to be your tenant.
Increasing your rent by small margins, however, could do wonders for your property’s value. Even small increases in rent translate to a huge increase in monthly income. This increase in income is great for the value of your property as long as it’s within the cap rate.
7. Add Another Bathroom
A bathroom is a good investment that yields much more than what you spend for it. You don’t even have to add an entire bathroom. Half bathrooms work just as well and are great for your property value too.
However, before you think about adding another bathroom, make sure that the plumbing can accommodate an extra bathroom. Also, make sure you have enough space for a decent bathroom or half bathroom for that matter.
Increase Property Value With the Right Moves
Making a fortune out of real estate investment is possible, but requires a lot of smart moves and sacrifice. You’re better placed for the win if you know how to increase property value. Hopefully, this piece will help you do exactly that.
Real estate isn’t the only thing we’re good at. For more insightful reads, be sure to check out the other pieces on the site.