Long-term apartment rentals in 2021-2022: How to improve housing and rent it out at a higher price

Author

Lesia Solovchuk

After the drop in rates on bank deposits, it became clear that it is much more profitable to rent out excess housing. However, the question arises of how to properly prepare a house for a long-term rental and at the same time get the maximum profit from it. The answer to this question is given by the set of rules for home staging that has gained popularity in Ukraine.

According to the home staging code, we cannot objectively influence many external factors: for example, the location of the apartment, the architecture of the building, transport logistics, etc. But we can make the client fall in love with the apartment and agree to a long-term rent.

According to experts, these rules will help raise the price by 1,500—3,000 UAH per month, even for the smallest one-room Khrushchev-era apartment in the capital. Whereas the luxury housing that is rented out for $3,000 can rise in price by 10-25% after improvement. How to achieve this—read in our article.

Interior: "No roses", hi-tech is better

The first step that an owner must take when deciding to rent out an apartment to tenants is to free the living space of their belongings. All trash should be removed to the last detail. And renovation even in the cheapest of the apartments will significantly improve its attractiveness—without mold on the walls, wet corners, signs of being flooded by neighbors, or obvious signs of previous tenants living in the apartment, and the like.

In the case of small economy-class housing with a rent of up to 10,000 UAH—these can be smart apartments of a new generation or Khrushchev-era apartments, Czech houses, panel buildings from the old stock—it is worth at least re-hang the wallpaper in neutral tones, without bourgeois flowers. You should also make sure that there are no signs of flooding or mold on the walls if you do not want the client to leave the apartment at night. The floor must also be whipped into shape: the putty parquet or the laminated flooring. Of course—there must be plastic windows and mosquito nets.

In the premium segment, tenants are much more picky. This refers to the space of an apartment in the city center of 100—120 sq. m after the building reconstruction or in new fashionable housing complexes that are now leased from $3.000 and more.

"In such apartments, renovation should not only be fresh, but also in line with fashion trends. It can be high-tech, minimalism, loft, or Scandinavian style. The tenant for such housing wants to see several bathrooms. For example, in one of them there is a bath, in the other there is a shower," Iryna Lukhanina, an expert on the real estate market, says.

It is important that the apartment should not just be clean before renants come—you need to invite a cleaning company that will wash the windows, professionally clean curtains and sofas.

In addition, according to the laws of home staging, the apartment should have pleasant fresh smells.

Furniture: Comfort comes first

Today's tenants don't like furniture cluttered homes. They will be satisfied with convenient solutions that add comfort. However, they require more comfort and therefore prefer an apartment with a bed.

"The owner thinks that an apartment with a sofa looks more organic. But people who rent an apartment even for little money want to sleep on good mattresses. Therefore, even if it is a one-room apartment, I recommend zoning: a sofa with a TV on one side, and a bed behind the partition," the realtor explains.

In the luxury options, in addition to a bed with an orthopedic mattress and a set of furniture, there should be a spacious dressing room. Important: both in the furniture upholstery and curtains or sunblind, expensive materials should be used.

Household appliances

Whatever the price category of the apartment, the tenant is always interested in whether there is an air conditioner. 60% of customers will drop out immediately if they find out about its absence. Having installed it in the apartment, you can always add another 500 UAH for payment to the total rental amount.

A refrigerator has been out of the question for a long time, a washing machine is also not considered a luxury. But an important bonus in the apartment will be a microwave oven, a toaster, and an electric kettle.

When preparing an apartment for rent, you should also pay attention to bathroom fixtures: clean the boiler, check pipes, taps, mixers, and valves to turn off the water supply.

The toilet bowl should not only be serviceable, but also not scare off customers, otherwise it is better to replace it with a new one.

"If it is a luxury apartment, there should also be underfloor heating, at least in the bathroom and kitchen area. The tenant wants to see a drying machine in addition to a washing machine, as well as a large freezer, and a wine cabinet," Iryna Lukhanina explains.

According to her, the appliances in a high-class apartment should be relatively new and from the top rated brands.

"The apartments over $1000 are expected to be fully loaded. Unlike a cheaper apartment, where dishes are usually not left, here a set of dishes, a set of pans, and glasses for various drinks will be a pleasant bonus. The same applies to the bedroom, where there should be a bed, as well as new pillows and blankets. Realtors show such clients an apartment with a set table with white tablecloths. Moreover, owners often work with realtors and designers who are familiar with home staging, who suggest how best to place paintings and how to choose lighting. For the tenant to enter the apartment and fall in love with it," the expert notes.

Safety first

Usually, when renting an apartment, questions of elementary security are also discussed. In new housing complexes with a closed area, this is easier. In other cases, it is important to have a concierge. In the old stock, a combination lock or intercom should be provided.

In expensive apartments, preference is given to options with an alarm. It is important for car owners that a separate parking space is provided.

Schtick—a large glazed area, exclusive lighting, or a home theater system—will often help to add significantly to the price. At least in the segment of expensive apartments, such surprises will rather be an advantage: the client will much faster agree to the option with exclusive bonuses that are not found in other, even luxury apartments.

"Clients of expensive apartments do not really care how much they pay for rent—$3,000 or $3,500. In case of any non-standard solutions in the interior, bonuses in household appliances, the tenant will be inclined to choose an exclusive one," the expert explains.

Apartment in a new building: Renting out faster and more profitable

Today buying an apartment in a new building is not just a trend, but also a profitable business. Many Ukrainians started investing in real estate and then selling finished housing, or renting it out. To pay off an apartment in a high-quality new building of the comfort+ class, which can be rented out in Kyiv for $1000—$1,500, is real in 4—6 years. In this case, you can accelerate the process of obtaining funds from the completed housing by purchasing an apartment with a ready-made renovation.

Taking into account the exactingness of the tenants of expensive apartments in a new building to the interior, it would be logical to entrust this work to professionals. So, in order for the investment to start working for you faster, you can use the service of a developer and buy an apartment with renovation and even with furniture and appliances.

We examined the proposals of various developers and found out that today they offer not one, standard, renovation but several different design options at once. For example, the online aggregator for selecting ready-made interior solutions #READYDIM from the group of companies DIM offers 100 different interiors. Moreover, it guarantees that there are no two identical apartments, and that allows you to preserve the exclusivity of the renovation.

It is worth noting here that repairs from the developer will be cheaper and faster than the one made on your own. As a result, you will save not only time and money, but also nerves, because the developer will undertake the search, purchase and delivery of building materials, communication with builders, and control of the work. And as soon as the house is put into operation, you can easily settle the tenants in the apartment and return the investment.