Renovations That Pay Off: Best Upgrades for Rental Properties in 2025

According to a 2024 report by the National Association of Realtors, properties with recent renovations saw a 12–15% increase in rental income and a 9% higher occupancy rate compared to unrenovated units. As we step into 2025, it’s clear that strategic upgrades can significantly boost your ROI—not just by increasing rent but also by attracting high-quality, long-term tenants.

But not all renovations are created equal. Let’s dive into the most profitable upgrades for rental properties this year.

1. Modernize the Kitchen Without Breaking the Bank

The kitchen remains the heart of the home—even in rental properties.

Examples of cost-effective upgrades:

-Replace outdated countertops with durable quartz or butcher block.

-Upgrade to energy-efficient appliances.

-Swap old cabinet hardware with modern handles or knobs.

Tip: A minor kitchen remodel can yield a return of up to 81% of the cost, according to Remodeling Magazine.

2. Add Smart Home Features

Smart technology continues to be a major draw for renters in 2025.

Smart upgrades to consider:

-Keyless entry systems

-Smart thermostats (like Nest or Ecobee)

-Security cameras or video doorbells

These not only increase perceived value but also appeal to younger, tech-savvy renters looking for convenience and control.

3. Enhance Curb Appeal for a Strong First Impression

Your property’s exterior is the first thing potential tenants see. Simple changes can go a long way.

Examples:

-Fresh exterior paint or siding

-Low-maintenance landscaping with native plants

-Modern lighting fixtures for the porch or entryway

Fun Fact: Zillow found that homes with black front doors sold for up to $6,000 more—imagine the appeal for rentals too!

4. Update the Bathrooms

Next to the kitchen, bathrooms have the biggest impact on a renter’s decision.

-Ideas for a modern touch:

-Install a new vanity or mirror with LED lighting

-Replace old faucets and showerheads with water-efficient models

-Add a neutral tile backsplash or accent wall

These improvements help position your rental as clean, contemporary, and well-maintained.

5. Create a Functional Home Office or Flex Space

With remote work still prevalent, renters are looking for dedicated spaces.

-Easy transformation tips:

-Add a desk nook in an unused closet or hallway

-Convert part of a basement or garage into a quiet workspace

-Use lighting and room dividers to create separation

This small change can justify a rent increase, especially in urban areas.

6. Flooring Matters: Say Goodbye to Carpet

Hard flooring is more durable, modern, and easier to maintain—making it a win-win for landlords and tenants.

-Top flooring choices for rentals:

-Luxury vinyl plank (LVP)

-Laminate flooring with wood grain finish

-Tile for kitchens and bathrooms

These are water-resistant, long-lasting, and attractive to most tenants.

Conclusion

Making the right upgrades doesn’t mean overspending—it means being strategic. By focusing on updates that increase both visual appeal and functionality, landlords can see higher rent prices, fewer vacancies, and better tenant retention.

So, what renovation are you planning to tackle first in 2025? And which upgrade do you think will bring you the best ROI?

Let us know in the comments—we’d love to hear your thoughts!