Upgrade master bedroom/bath for more rent?

[Mike Roberts]

I bought a house this summer that I plan to live in for about 2 years and then rent. While I'm here I'm fixing it up a bit, though it doesn't need much. The house is the cheapest one in the neighborhood, I'm on a lake and many of the neighbors are million+ dollar houses. There aren't many rentals to compare to around here, but my realtor says there is a demand for it.

Anyway, the house is a bit weird. It is 4 bedroom, 2 bath, but all the bedrooms are tiny and there is no master bedroom. It's very hard to fit an adult size bed in any of the rooms. They are just fine for a child or an office, but not one or more adults. I would like to expand one of the bedrooms and take over the bathroom next to it and call it the master. It would fit very easily into the shape of the house and I don't think construction would be terribly expensive. It would only add about 100sq ft to the house.

The question is, will that do anything to help increase rent in the future? I know it would add to the resale value, but will it help the rent? Given it's location, and the neighborhood, I would expect a family to rent this. They would need to have a little better than average income for the area.

At the same time I'd like to remodel the bathroom - is the rent going to be any better if I use high end fixtures, etc vs basic home center stuff? It's not bad now, just very basic and boring.