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How do I prioritize which renovations to make?

If you are considering a major overhaul of your property and have a long list of projects and goals, you may be asking yourself where to begin.

As a rule of thumb, you might want to determine which projects will have the biggest impact on the property’s value, taking into consideration how much you could reasonably increase the rent. However, you might want to first address anything that is in dire need of repair, such as leaky faucets or faulty appliances. These items are often the subject of tenant complaints or Maintenance Requests, and often take priority.

As you plan for which projects to tackle first, assuming you have already addressed immediate needs, consider the following questions:

  • What is your property value?
  • What is your base rent?
  • What rent does your competition charge? This will help you determine how much, if any, increase you could make to your rent while still remaining competitive.
  • What is your renovation budget?
  • What is your post-renovation property value?

The answers to these questions might give you a good idea of what you are working with. From there, you will want to prioritize projects that will increase your property value, or increase what you can charge for rent. These projects typically include the following:

  • Simple fixes and preventative maintenance. Depending on your own skill level, this may just be an investment of your time.
  • Kitchens and bathrooms. Updated or renovated kitchens and bathrooms usually provide the most ROI in both property value and tenant satisfaction.
  • Appliances. New appliances can sometimes save you money if the old ones require frequent maintenance, or use enormous amounts of energy.
  • Paint. While it can be labor intensive, a fresh paint job can go a long way toward transforming the appeal of a rental unit.
  • Curb appeal. Simple things like pressure washing the siding, installing planter boxes and other light touches to the exterior can help your property stand out.

Can I renovate my property when it is occupied by tenants?

You can renovate property that is occupied by tenants, but you have to provide proper notice and make other accommodations when warranted. These requirements vary by state, and depend on the type of renovations and other considerations.

Some renovations may cause certain inconveniences but can reasonably be accomplished with tenants present. You may offer a rent discount or move them to another unit, if available. Other tips include:

  • Be transparent and explain to your tenants the scope of your renovations, timeframes and any inconveniences that may arise.
  • Negotiate an agreement, if possible. For example, if the laundry facilities will be temporarily closed, you could offer lower rent as a concession with a Lease Amendment.
  • Always provide a Landlord’s Notice to Enter if you need to access their unit.
  • Keep renters apprised of the progress, including any significant changes in the renovation process.
  • Be prepared to cover any damage or loss caused by renovation work.

Even though you may have high hopes to renovate an occupied rental property, your tenants have the right to decline your request and quietly enjoy their home for the duration of the Lease Agreement. If you are hoping to make renovations that require the tenants to temporarily move out, and they refuse, you may not be able to simply evict them during their lease.

Alternatives to handing down an Eviction Notice or waiting until their lease ends include offering to move them to another unit and helping them with moving expenses if they agree to cancel the lease early. If you are unsure about the rights of your tenants during a renovation, reach out to a Rocket Lawyer network attorney to help you navigate the process the right way.

When do I need a permit for a property renovation?

Although permits are often required whether you are renovating your private home or a rental property, the permitting process is typically more stringent for rental properties. This includes additional steps and inspections, depending on local and state regulations.

If you are savvy enough to navigate the process yourself, then you may choose to apply for permits on your own. Otherwise, you may want to consider working with an experienced general contractor, or construction management company. They will know which permits are needed and will keep you apprised of the progress of your project.

Permits will differ by state and local regulations, but here are some of the most common permitting requirements for major renovations to rental property:

  • Electrical.
  • Plumbing.
  • HVAC.
  • Roofing.
  • Windows.
  • Construction or building.

What should I be aware of when negotiating property renovations with contractors?

Before you meet with contractors and get quotes, it is best to do your own research to get a sense of what the project may cost, how long it may take, and to learn of possible complications that can arise.

After doing your homework, consider getting quotes from at least three contractors for any given renovation job. Also, research the contractors you are considering hiring. And remember, the cheapest quote is not necessarily the best quote. You may want to look at the cost of materials and labor, and how that compares in each contractor’s estimate. If they are coming in a little high as compared to other contractors, you could use that as leverage when it comes time to negotiate the deal.

Here are some negotiating methods:

  • Wait until contractors are not as busy, perhaps during slower seasons.
  • Offer to purchase supplies yourself. While contractors often get discounts, they may also charge markups.
  • Make it clear that a contractor understands you are getting quotes from multiple contractors.
  • Build rapport with contractors. Ask questions based on your research.
  • Be prepared to walk away if you do not like the terms, or cannot get along with the contractor.

Once the renovations are completed, you may want more rent for the improved unit. While it may be difficult to convince existing tenants to pay more for rent, you may send them a Rent Increase Letter informing them that the rent will increase upon renewal of their lease. It is best to give them a fair warning well ahead of time.


No matter how large or small the project, properly preparing for rental renovations and understanding tenants’ rights during renovations are keys to successful property management. To learn more about the laws surrounding renovations for rental properties, reach out to a Rocket Lawyer network attorney for affordable legal advice.

This article contains general legal information and does not contain legal advice. Rocket Lawyer is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.


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