"We've seen where Harley-Davidsons were rebuilt in the living room or cigarettes were ground in the carpet," says Los Angeles-based real estate investment adviser Lisa Vander. "A lot of my really great thrifty and profit-minded investors are shifting from carpet to tile and putting in throw rugs."

Randel agrees. "I don't care how nice the people are and how big a security deposit, there will always be carpet issues," he says. "We used wood flooring; the worst thing you had to do was re-sand and re-stain. In the kitchens, you do tile or linoleum."

To keep kitchen remodeling costs down, interior designer, real estate investor and author Sharon Hanby-Robie suggests stock cabinets from a home-improvement store. Also, if you're gutting the kitchen and have some flexibility in the layout, visit the major kitchen showrooms and ask if they're getting rid of any displays. They change those out about once a year, she says. You can also scour Habitat for Humanity resale stores for interesting architectural details on the cheap.

You can make your rental unit stand out from the competition, Hanby-Robie says, by installing a basic dishwasher and offering a washer and dryer. "Gals don't want to have to go to the Laundromat," she says. "That will make renting your place so much easier."

Of course, you can't get any cheaper than free. Real estate investor Brent Knittel has eight condos in Lake Tahoe, Nev., and has remodeled all of them on his own. A high school special education teacher, he's on a tight budget, so he keeps an eye out for used, white appliances.

"If someone is upgrading to a new appliance, I'll be there with my truck to take their old appliance," he says. "I'll yank it, store it and use it in the next remodel. I always take refrigerators, and washers and dryers are selling points. A lot of rental units don't have those."

That strategy is fine for rentals, says Irwin, but it won't work on a resale.

"There have been huge changes in appliances in the last 10 years," he says. "If you want top dollar in a house, you have to replace appliances with new ones that look good. There is a level just above the basic one, but looks pretty darn good, that's a good line to put into the property. They're not expensive but they're expensive-looking."

One final way you can spruce up an investment property is to update the lighting. New lights in the hallways, bedrooms, baths and kitchen can make a world of difference, says Steve Berges, a Lake Orion, Mich.-based real estate investor and author of "101 Cost-Effective Ways to Increase the Value of Your Home."

"You want bright and cheery, not dark and dreary," Berges says. "In some older houses, the lighting fixtures are so dated and worn out. You can buy $500 worth of lights and dress that house up on the inside."