For most landlords, the primary goal of real estate investment is to earn more and succeed financially. After all, a survey by Better Homes and Gardens Real Estate revealed that 96% of people who have invested in real estate believe their decision helped them achieve financial success. However, many landlords miss out on one of the top ways to improve their earnings and increase their rentals’ values.
Shifting to eco-friendly practices and making environmentally-focused upgrades to your rental property can earn you more while saving energy and making your property more appealing to potential tenants. If you want to earn more by going green, here are just a few tips to get you started.
Help Out Your Heating System
Not every landlord or real estate investor will pay for their tenants’ heating and cooling; often, the tenants are responsible for those bills. However, it’s still incredibly useful and helpful to cut down on those bills as much as possible, even if you’re not the one paying for them. According to the Department of Energy, approximately 56% of the energy used in homes in the United States is for heating and cooling. Cutting down on the energy needed for heating and cooling the home means lower utility bills overall. Low utility payments can be very attractive to potential tenants, and may even convince a tenant to choose your rental over a competitor’s.
What’s the best way to shrink your tenants’ heating bills without control over how they set the thermostat? When you get the chance, try replacing your windows. It may seem like a costly adjustment, but it can pay for itself over time in energy savings. Approximately 30% of a home’s heating energy is lost through its windows, so switching to energy-efficient windows can make a huge difference. If there isn’t enough money in the budget for all new windows, add window treatments like blinds or curtains to help keep heat in.
Avoid Wasting Water
Even if you’re not paying for the electric or gas bill, most landlords will at least cover water, sewer, and trash expenses. These can add up quickly, especially across multiple properties, but there are plenty of solutions available to lower water use without changing tenant behaviors. For example, make sure you’re keeping any leaks at bay and making regular repairs to plumbing and fixtures throughout your rental properties. A trillion gallons of water, worth $6 billion, are wasted each year as the result of running toilets, leaking faucets, or other leaks. Not only is this harmful to the environment, but it also costs you extra money without any benefit. Instead, stay ahead of leaks and plumbing damage with proper maintenance.
Don’t forget about upgrading fixtures to low-flow options, too. A low-flow showerhead, faucet, or toilet can help you cut down on water spending without impacting the quality of your rental. In fact, many renters now look for these features in potential apartments or other rental properties. The greener your space is, the more marketable it can become.
Repair And Remodel
If you’ve got extra money to spend, try putting it back into your property with eco-friendly repair and remodeling projects. The more you invest in your property, the more likely you are to see increased profits. These changes might not be immediately visible to tenants, but they can help you save money by avoiding future damages. For example, when was the last time your roof was repaired or replaced? Homeowners are most likely to repair roofs following weather damage; 65% said it was their main motivation in a consumer survey. Scheduling roof repair before bad weather hits can save you money, and also avoids overspending on heating and cooling bills.
If you’re looking to make major upgrades to your efficiency, you may want to consider renovating at the same time. You’ll be able to make larger changes to improve energy efficiency while also modernizing your apartment and improving its value. Focus on the spaces that will help you increase the rental price on your space, like the kitchen. Even a minor kitchen remodel has an average return on investment of 82.7%. You’ll shrink your rental property’s energy use while increasing your long-term profits.
For a better investment over time, you’ll want to update your rental property for energy efficiency. This decreases how much you spend on your property, improves its value, and draws in more tenants. What steps do you plan to take to go green in your investment properties?