Money talks: why it's not always cost-effective to renovate a rental home between tenants

My tenants are moving out, having found a place to buy, and once again I find myself wondering whether to do up the property before attempting to get anyone in to rent it.

It was last renovated when my husband and I bought it more than 12 years ago, and for a while now I’ve been thinking that the bathroom and kitchen could do with a makeover. Everything still functions perfectly, and the flat isn’t difficult to re-let, in fact, I rarely have to do more than a day of viewings, but I think both the bathroom and kitchen look dated.

Also, the last few couples have stayed for only a year each and I’m wondering if tenants might stick around longer if the flat is nicer. But it is not strictly necessary, says my husband.

I have form in wasting cash on renovations. I spent £10,000 on a new bathroom and a garden makeover in another flat, which didn’t add to its rental value. In fact, I struggled to find a tenant once the works were completed and ended up re-letting the property for about £50 a month less than I was getting previously. I don’t want to repeat my mistake, so this time I agree with my husband that we should “do the maths” first. We work out that new kitchen units and fixtures and fittings will cost at least £2,500, while tiles will add another £300 to the bill.

Labour will be about £8,000 and the work will take at least a month, maybe much longer, during which time we’ll be losing rent and we will have to pay the council tax during this period, too. Altogether, I reckon the job will set us back at least £14,000.