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Jan 26

Protecting Your Investment: Why Regular Property Maintenance is Important

Reading Time: 3 mins

No matter what neighborhood you drive through across the United States, you have a high probability of coming across that one particular property that stands out among the rest. But the thing is, this is the property that stands out for the worst of reasons.

While curb appeal will have people stopping to look and marvel at your property, having an unkempt property will cause people to stop and call the HOA. And this isn’t the type of reaction you’re after as an investor.

Properties that are well-maintained hold more overall value, sell more often and rent more often than those which have lacked critical maintenance over the years. And if you’re hoping to boost the overall value of your property and see a decent ROI from your property, you’ll want to pay attention to some key areas.

If you’re an investment property owner and you want to ensure the value of your property, here’s why maintenance is important.

 

You’ll Save More Money than You’ll Spend

It’s easy to think of expenses in a linear fashion. In fact, you might be thinking that if you’re constantly spending money on maintenance, then how will you ever break even?

Well, when it comes to maintenance, the price you’ll pay for fixing a problem later rises exponentially. In fact, a silent rule often known in the real estate business is that for every dollar you spend on maintenance, you’ll save nearly $100 on repairs in the future.

For example, if you have a rural property that requires a septic tank, if you don’t perform regular maintenance, you could be forking over a few thousand dollars to have your system replaced for lack of maintenance. And this is something that can be easily avoided. The same can be said with your home’s HVAC system; just knowing the basics can take your property and your dollar a very long way.

The key takeaway is simply to handle problems before they become worse, and you’ll end up saving hundreds of dollars for only spending a few.

 

Increased Property Value

When you purchase a property you’re investing in, you’re likely going to need to take out a loan for a specific dollar value. And as an investor, you want to keep this value–and do your best to increase it.

Even though the value of your home will fluctuate with the market, buying a home is not like buying a car which loses value the moment you drive it. In fact, the longer you own your home, the more you can spend to increase its value. And this can be achieved through regular maintenance.

A home with well-maintained hardware and appliances, i.e., items such as faucets, electrical outlets, fans, AC units, stoves, dishwashers, and the like will be valued at a higher rate when your home is inspected prior to a sale.

If you’re unable to keep any of your hardware, appliances, or any other feature of your home maintained, this will lower your estimated home value. And even worse, this can also affect the value of your neighbor’s homes as well.

 

Warranties

Most homeowners don’t understand the language written into warranties concerning their appliances. And this also relates to the fine print of insurance policies as well. But if you don’t actively perform maintenance, you could be forced to pay for replacements out of pocket.

Believe it or not, but home warranties on such items as AC units, pumps, propane tanks, and the like won’t cover repairs if it’s deemed that no maintenance was completed. For example, if your AC compressor fails, you might have caused this by not changing the filters.

Where home insurance is concerned, you could easily be out thousands of dollars if it’s found that your home was damaged due to inadequate maintenance. This is common when a roof or attic incurs water damage but has not been maintained over the years.

Maintenance is vital for your home to run efficiently. Just like you probably wouldn’t take a cross-country drive in a ‘64 Mustang with no floorboards, you probably wouldn’t be able to live in a home with rotten floors either. So it’s best to be proactive with maintenance because you’ll save money in the long run.

 

Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence.

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