Improvements to consider when selling a property
Opting to sell a multifamily property is rarely an easy decision. Once you’ve made the tough call to move forward and sell, it can be tempting to get the property on the market as quickly as possible. But investing in strategic improvements beforehand can boost its appeal to potential buyers and future renters alike, helping you make a smooth, successful sale.
What improvements should be the top priorities when getting ready to sell? Here are six to consider.
1. Address safety first
First, make any essential structural improvements to ensure your building is safe and well-maintained. After that, address any issues related to heating, plumbing or electrical, as well as any concerns outside of the property, such as cracks in concrete walkways that might pose a tripping hazard. Consider having an inspection done to ensure your property is up to code — doing so may help avoid costly delays when you’re ready to finalize the sale.
2. Make smaller repairs and cosmetic updates
These updates can range from making basic repairs and cosmetic improvements to installing modern upgrades, such as new lighting or appliances.
Look first at any basic repairs your property needs. Fixing leaks, wall damage, broken appliances, malfunctioning doors or locks are all examples of priority improvements.
Weigh the costs of improvements you’re considering against the potential increase in the selling price.
“One of the most common mistakes is going too far to kind of the luxury side of things,” says Matt Frankel, a certified financial planner, real estate analyst and contributor to Millionacres, a subsidiary of The Motley Fool. “Is there a functional and modern refrigerator? Is there a nice carpet that's clean? So, prioritizing function over luxury is definitely a good rule of thumb to keep in mind.”
Small things can make a big difference, and a fresh coat of paint on walls in common areas is an easy way to make a big impact for a relatively low cost. Also, consider repainting or refacing kitchen cabinets and replacing countertops, even if they are in fairly good condition.
3. Curb appeal matters
Remove any trash around the building and trim obtrusive greenery on your sidewalks and driveway. Simple landscaping, such as adding mulch around trees and in-ground plantings, bringing in flowering planters and removing weeds, can give a fresh, clean look to the outdoor areas of your property.
“Do anything" that's going to create positive first impressions, Frankel says.
4. Create a smarter property
Upgrading your property’s technology to incorporate smart devices can help reduce utility and maintenance costs and help owners attract residents. If you’re not sure where to start, you can focus on upgrading your property’s lighting, security and HVAC system to maximize your investment.
A WiFi-connected smart thermostat, for example, requires minimal installation and helps reduce energy consumption. Users can manage temperatures remotely and set specific times to heat or cool their residence. Smart lighting, door locks and doorbells allow tenants to monitor their homes on their smartphone, which ultimately makes your property safer and easier to manage.
5. Go green
Improving your property’s environmental impact can also increase its appeal, as future buyers can benefit from the cost efficiencies. Consider replacing incandescent light bulbs with LED bulbs, which use less energy, last longer and can help reduce maintenance costs.
The U.S. Environmental Protection Agency states that WaterSense fixtures are 20% more water-efficient and outperform standard models by eliminating leaks that can waste approximately 180 gallons of water per household per week.
In addition, the U.S. Department of Energy recommends replacing single-pane windows “with double-pane windows with high-performance glass — low-e (low-emissivity) or spectrally selective coatings.” This upgrade can help insulate residences and reduce heating and cooling costs. In addition, double-pane windows can minimize outside noise, creating a quieter and more pleasant indoor atmosphere for the property’s residences.
6. Think from the perspective of tenants
Potential buyers want to ensure the property they invest in will have tangible benefits that appeal to tenants. Ask yourself: What will they want?
“One of the most common mistakes that property owners make is not knowing what your tenants want,” Frankel says.
“The No. 1 thing that renters say they would pay more for is additional parking, guest parking, dedicated parking spots, things like that,” Frankel adds. “So if you have a vacant patch of grass next to your property, then you could potentially turn [it] into a parking space. That's a real outside-of-the-box way of adding value that you might not have thought of.”
Making certain improvements can go a long way toward facilitating a successful sale. Together, these steps can increase your property’s appeal, as well as your potential to sell.
From the editorial team at Story by J.P. Morgan