How Much Should I Fix Up My Rental Home for the Next Tenant?
The perfect scenario:
You are lounging on a sunny, deserted beach with your loving wife by your side. You have a cold drink in your hand as you marvel at the solitude and beauty of your surroundings. The only sounds you hear are the waves gently crashing in front of you and the occasional fluttering of a seagull’s wings. The sun subtly warms your skin before a timely breeze arrives to refresh you. You grasp your wife’s hand as she lovingly reciprocates. And you just filled your last rental property with a tenant. Life is perfect.
But, wait… is that your cell phone ringing in your beach bag? Who could be calling you? As you reach for the phone, your wife aggressively removes her hand from yours. “You better not answer that! We haven’t been away together since Eli was born and I’m not going to have our vacation ruined by work calls!” As your eyes refocus to the numbers on the phone, you realize it is the new tenant. “I’ve got to get this,” you mutter as your wife disgustedly begins to turn her beach chair away from you. You feign an enthusiastic greeting of “Hey Herb, what’s up? How’s the place?” as your eyes plead forgiveness to your now emotionally-estranged wife.
Herb begins his 10-minute rant, “This place is a dump! The whole house is filthy! The cabinets and appliances are especially gross and the entire trim needs to be repainted. The landscaping has been completely neglected and the yard is mostly weeds. My wife and I have spent our first 48 hours here on our hands and knees scrubbing and aren’t even close to being done! The air conditioning doesn’t even blow cold air. How could anyone live in this place??”
“Multiple tenants have managed to survive the experience in past 12 years I’ve rented it out,” you want to retort and then think better of it. You turn your head to see your wife disgustedly heading back towards the resort while pounding feverishly on her iPhone, undoubtedly spewing Facebook hate (Subject: You).
Herb is irate and you hear his wife trying to get into the action in the background. Once Herb says his piece, you tell him you’re very sorry, you’ll have someone over to look at the air conditioning, and will send the cleaners back (“No need! If they think the condition they left it in was clean, I don’t care to entertain their second act!”).
So this is bad. You thought you had the rental home in good shape and the tenants are ripping it apart. You look up at the resort and see your wife talking to the pool boy as she uncharacteristically is downing cocktails at 9 AM. This was supposed to be a relaxing, loving vacation and things are going very wrong.
What could have been done to avoid this tenant situation? Honestly, nothing. No matter how clean a house is left, some tenants will say it is filthy. Cleanliness is subjective.
There is a relatively predictable spectrum of responses from tenants after they move-in:
- 10% will be happy with whatever condition the home is in when they move-in
- 10% will be unhappy with whatever condition the home is in when they move-in
- 80% will be happy if the home is reasonably clean and touched-up when they move-in
So if things are reasonably clean, all major systems are working, and the house has been touched up, 90% of tenants will be happy. And everyone likes happy tenants.
And what about the unhappy 10%? It’s not a desirable situation, but there is a silver lining. You will take heat on the front end from them; that is for sure. And you won’t like it. But there are 2 positive takeaways:
- There was nothing you could have done to avoid their unhappiness. If you fixed your home up to such a pristine condition, it would crush the ROI on your investment property. And if you are going to pay to fix it up that much, do it only once and sell it for top dollar. Don’t do it every year. The objective (I’m told) is to make money on investments.
- When the initially unhappy tenants vacate, they will probably leave your home in move-in condition for the next tenant! This allows you to take the pain now to experience joy later.
So, to sum it up:
1. Fix-up your home in a reasonable manner between tenants. This means all systems working, touch-up paint (don’t repaint the house), steam cleaned carpet (don’t replace the flooring), and professional cleaning.
2. Hire a property manager so you don’t have to answer the phone on vacation.
3. Go get your wife!
Brett Furniss is the President & Owner of BDF Realty (Charlotte Residential Property Management), the trusted real estate advisor for Charlotte landlords & Home of $100 Flat Fee Property Management. BDF Realty utilizes their innovative Pod System for exceptional customer service in residential property management, home repairs, and home sales (including Rent-To-Sell) for single-family homes, condos, and town homes in the Charlotte-Metro Area. Contact Us Today!
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