Investing in a rental property extends beyond interior maintenance, as landscaping and yard renovations can deliver significant returns on investment. For example, a well-tended garden can increase a property's value by up to 10%, attracting high-quality tenants and accelerating sales.
Among various backyard improvements, a good fence can maintain neighborly relations, clearly define property lines, offer privacy, and reduce noise. Fire pits can yield returns of up to 80%, especially with a natural gas line installation. Adding a pergola or extending a patio roof can provide shade, enhance property value, and appeal to potential tenants. And patios, which are in high demand among buyers, can considerably impact property sales or rentals.
Renovating a backyard can substantially boost investment property value. However, thoroughly researching costs and building a comprehensive project plan are essential for achieving the best results. Read the full article:
While everyone likes pretty things (or is that just me?), as an investor with a rental property, ultimately a return on investment is the paramount driving force.
What you spend is just as important as where you spend it. Having an approximate dollar amount through a carefully thought-out budget for your expenditure will help you to decide what to spend on landscaping and yard renovations to get a good return on investment. As a rough guideline, a beautifully landscaped garden that doesn’t require a great deal of maintenance can add up to 10% to your home's value.
It is worth noting that it's very rare for landscaping a backyard to turn a profit – but if undertaken with prudence, you should make your money back by adding residual value to your rental property. This will also carry the intrinsic value of a higher likelihood of attracting A+ tenants. Also, it can certainly improve your chances of selling your home faster and for a higher price.
Here's a round-up of a few backyard improvements that savvy investors may wish to consider for the backyard beautification of their rental property.
Good Fences Make Good Neighbours.
We’ve all heard the phrase that good fences make good neighbours and it can certainly help to alleviate conflict between two residents. This can get particularly sticky if you’re the landlord who gets pulled into a conflict between your tenant and the neighbour. Perhaps the return on investment in this case is your time and sanity!
Joking aside, a fence along the property line serves a wonderful function; it delineates the property lines. This can help prevent your neighbour’s pooch from dropping bombs on your lawn, from the neighbour’s children from playing in your property’s garden but it also has other contributions. A good privacy fence gives residents a sense of autonomy and allows them to explore the outdoors without the watchful eye of their neighbour. It also works in the reverse. You or your tenants may not wish to see your neighbour fix up his car in his driveway.
A fence also helps to block sound. So, if your tenants are anything like this writer and don’t wish to hear the neighbour belting out Pantera while he works on his car, a fence may provide assistance in minimizing some of the serenades.
The cost of building a fence though can be pricy. The range for a new fence can fall anywhere between $2,000 to $5,000. On average, property owners spend about $3,500 for their fence, material dependent. Some of these costs can be mitigated by approaching the neighbour with whom you share the property line to also share some of the cost.
A word to the wise on property lines, if you don't have a survey in hand, reach out to the municipal government before building that fence. Property line disputes and fences go hand in hand, so ensure you know what belongs to you and what is owned by your neighbours or run the risk of being ordered to take down the fence.
Let There be Fire.
When it comes to bang for your buck in backyard renos, it’s hard to find a better return on investment than that which comes from adding a fire pit. According to most estimates, homeowners can recover 78% of the expenditures of installing a fire pit, particularly one with a natural gas line.
The cost of creating a do-it-yourself fire pit will depend on the materials utilized. In fact, a gas line is of exponentially higher cost but also exponentially higher return on investment (ROI). Homeowners may be able to raise the ROI of a fire pit to more than 80% by selecting a less expensive method of construction and design.
Here are a few guidelines that may ensure you put your feet up sooner rather than later.
- Build a fire pit out in the open and away from structures. Also, be sure you have permission from the city if you use natural gas.
- Even though the term "fire pit" could imply that a structure is not required, take safety precautions and build a solid framework around it. Don't create a pit.
Raising the Roof.
Adding a pergola or an extended roof to a backyard patio or lounging area can increase not only the amount of shade but also have a positive impact on the resale value or attract more desirable tenants.
The ROI of adding a pergola to a patio is estimated to be around 50%, though this might vary greatly depending on where the property is located and/ or what materials are used in the construction of the overstructure.
Even though a backyard pergola or an extended roof may appear beneficial, this decision to create needs to be tempered with considerations around the expense. Fortunately, it is possible to acquire attractive pre-fabricated pergolas that are less expensive but still increase the value of a home.
Is any backyard really complete without a patio? We as Canadians love patio season. Whether we’re sipping some pinot grigio on a restaurant patio or enjoying the spoils of a hard work week by chugging a cold one while firing up the grill, we love to get some vitamin D while we can in the summer months.
Patios are a sought-after amenity for most homes, making them a valuable addition when trying to rent or resell a home. In fact, I have seen a patio make or break the purchase of a home or serve as a tie-breaker for deciding upon one home over another. On average, the cost of building a patio can be as high as $5,300 depending on the size and materials used.
In order to get the best return on your outdoor patio we, at Canadian Real Estate Wealth have outfitted you with the following tips:
- DO: consider lighting! Choose lighting that allows one to enjoy the patio space as one would an outdoor living room in the evening and add patio furniture with comfort in mind.
- DON’T: Take up too much backyard space. Many families relish the green space in the backyard, so leave enough space for kids and animals to roam.
There’s a tremendous opportunity that you may not have considered to increase the value of your investment property by making it more desirable to potential tenants and / or potential buyers through the fine art of backyard renovation. However, renovators heed the old adage, “A fool and their money will soon be parted” by exercising due diligence through research and costing out the project before lifting the hammer or pounding a single nail.