Exterior Remodel and ROI
Multi-family properties are a significant part of the real estate market, providing homes to millions of individuals and families nationwide. With the growing competition in the market, property managers are constantly looking for ways to attract tenants and increase the value of their properties. One way to achieve this is by carrying out an exterior multi-family remodel that involves color and paint updates, landscaping upgrades, and other renovations that enhance the property's aesthetic appeal. In this blog, we will explore the remodel's impact and the return on investment (ROI) for a property manager.
Attracting and Retaining tenants
The exterior appearance of a multi-family property is critical in attracting tenants and creating a positive impression. By updating the color and paint, a property manager can transform the look and feel of the property, making it more appealing to potential tenants. Additionally, landscaping upgrades such as new plants, shrubs, and trees can add a natural element and enhance the property's overall appearance.
One of the significant benefits of an exterior remodel is the increase in property value. An attractive property with excellent curb appeal is more likely to fetch higher rental rates and attract quality tenants, ultimately leading to a higher resale value. The enhanced aesthetic appeal also translates to better tenant retention rates, reducing turnover and vacancy costs.
Another advantage of an exterior remodel is the potential for reduced maintenance costs. A property with a fresh coat of paint, sealed surfaces, and new landscaping is less likely to require repairs and maintenance, reducing the overall upkeep cost.
ROI for Property Managers
While an exterior remodel requires a significant investment, it is essential to evaluate the ROI to determine its viability. The ROI is calculated by dividing the net profit by the investment cost. The net profit includes the additional rental income generated by the remodel, reduced maintenance costs, and increased property value.
The ROI for an exterior remodel varies depending on several factors, including the property's size, the renovation's scope, and the location. However, according to industry experts, a well-executed exterior remodel can result in an ROI of between 20-30%. This means that for every dollar spent on the remodel, the property manager can expect to generate an additional 20-30 cents in net profit.
In summary, an exterior multi-family remodel that involves color and paint updates, landscaping upgrades, and other renovations is a worthwhile investment for property managers. The enhanced aesthetic appeal of the property can attract quality tenants, reduce maintenance costs, and increase property value, ultimately resulting in a higher ROI. Property managers should carefully evaluate the ROI of an exterior remodel and work with experienced contractors to ensure the project's success.
Kimberly Layton - CEO and Founder of Color Design LLC