Property maintenance will not only preserve a property’s value – it can actually increase it. A study by the University of Connecticut and Syracuse University discovered that maintenance can boost a property’s value by about 1 percent per year. That may seem minimal, but consider this: it means you can charge more rent or sell your property for a higher price. One percent of a $1 million home is already $10,000. That one percent can go a long way – you can add it to your retirement fund, use it to pay for property management fees, or use it to purchase more properties.
Here’s why maintenance is advantageous to real estate investors and homeowners, particularly when it comes to the property’s value:
Maintenance Keeps the Property in Good Shape
Proper maintenance keeps problems at bay, and in turn, prevents the property’s value from plummeting. It’s also one way to slow down the process of wear and tear. Having the HVAC checked once a year, for instance, keeps it in good working condition so you won’t have to have it replaced. Additionally, dealing with water damage is one of the best ways to prevent mold growth, which can decrease a property’s value by about 3 percent.
When a property is in superior condition, you can raise your rent. People won’t be able to complain because your price will have been justified by the property’s condition. You can also put a higher price tag on your property in case you decide to sell it.
And as a bonus, you’ll be able to keep your costs low. By resolving maintenance concerns in a timely manner, you can prevent problems from becoming worse. You can save yourself from costly repairs.
Pro Tip: Whether you’re an investor or homeowner, hiring a property management company is a great way to preserve your property. You can delegate your duties and chores to a team of property management agents – you won’t have to lift a single finger!
Tenants Find Value in a Well-Maintained Home
It’s worth mentioning that by value, we aren’t talking only about the dollar value of your real estate investment, but the value it has to your tenants, as well. Maintenance can increase your property’s perceived value because the more well-maintained it is, the more attractive it will be to potential tenants.
If potential tenants see that your rental property’s paint is peeling off, carpets are stained, and the lawn isn’t mowed, they’re not going to want to rent. Poor maintenance also means your property won’t be able to compete with comparable properties. Remember, for you to find tenants, your rental needs to stand out from the rest.
But if your property looks well-kempt, with its lawn mowed, walls painted, and curb appeal on point, people are going to be lining up to rent with you. What’s more, your tenants will be willing to pay a premium if they can see that their landlord stays on top of maintenance.
Maintenance Prevents Tenant Turnover
It’s not only your potential tenants who see value in a well-maintained property but also the tenants you already have. People will be more willing to renew if you can guarantee that the rental will be well-maintained for the long term. For instance, if you consistently attend to your tenant’s repair-related concerns, there’s a good chance that they’ll want to rent with you again. However, if you don’t take maintenance seriously, they’ll likely choose your competitors’ properties over yours.
Pro Tip: Working with a property management company that provides house maintenance services can help you stay on top of repairs. Companies use apps or “portals” that let tenants submit repair tickets in case there’s an issue on the property.
Maintenance Slows Down Depreciation
When a property is kept in good condition, depreciation slows down. In case you didn’t know, you need to take depreciation into account when calculating the value of real estate. Slow depreciation means that the asset will lose its value slower, and will get to “live” longer. Even if you sell your property in ten years, as long as it’s well-maintained, you can still get a pretty good price for it.
How Much Does Property Maintenance Cost?
So, how much will you spend on property maintenance? There’s no definite number, but as a baseline, you try to set aside at least 1 percent of your property’s value per year. For a $500,000 property, that works out to $5,000 per year or around $400 per month. However, you might have to spend more for certain maintenance works such as roof cleaning and landscaping. Your home’s location can also make maintenance costs more expensive – for example, homes in stormy areas will require more frequent outdoor maintenance.
One way to save is by partnering with a property management company that provides house maintenance services. They have their own network of vendors who can perform maintenance work at a discounted price.
Make Sure to Prepare a Maintenance Plan
Preventive maintenance goes a long way, but you’ll only be able to do it if you’ve got a solid plan. That’s why you should always start the year with a maintenance plan. Write down what needs to be done during every season. For instance, your summer maintenance checklist would include tasks like checking windows and servicing the HVAC. By preparing a maintenance plan, you’ll be able to be proactive and make sure you don’t forget to do anything. Preparing a maintenance plan isn’t that hard, just follow our rental property maintenance guide step by step.
Increase Your Property’s Value With House Maintenance Services
When you partner with Luxury Property Care, you’ll get your very own team of property managers who’ll handle everything related to maintenance. Whether you’re a rental owner or homeowner, you’ll be able to keep your property in tip-top shape, and in return, boost its value. We start every partnership with a one-on-one consultation with the owner, as this allows us to develop a tailor-made maintenance plan that meets their property needs and investment milestones. Once that’s taken care of, you can count on us to do your duties for you!