5 Secrets to Increasing Your Rental’s Profits
Real estate is a tricky, but very rewarding business; particularly for those who have retired. For those who retire younger than the national retiring age, real estate can be your next venture. Not only is real estate very profitable, but it’s also a good way to readjust to society. For example, if you’re looking for an ex-military career, there are great franchise opportunities for military veterans that not only provide the support and boost you need to start a property management business, but also provide a discount on the starting fees.
Once you begin your property management journey, you’ll want to maximize profits.
Scroll down for 5 secrets to increasing your rental property’s value:
1 Upgrade the Apartment
The best way to increase the profit on a rental property is to increase the rent. Renovating the property is the best way to do this, as it not only ensures that the building is up to code, it is also an investment on the property itself, for if and when you sell it. Upgrading the plumbing from the piping (if old and degrading) to installing new fixtures to give your property new life are all key investments. This principle also applies to windows – newer, energy efficient windows are a feature tenants want.
Aesthetics are important, too. Installing beautiful countertops will increase the rent on your apartment instantly. The same goes with the floors. Cut out any linoleum or vinyl and replace it with quality items. Paint the entire home to ensure that the walls are bright and fresh.
2 Add Revenue Streams
To maximize profits, add a means to increase your revenue. You can do this by adding services to your rental property. If your rental property is a building, consider adding a coin washer/dryer or vending machines to bring in more money. Otherwise, you can offer cleaning or landscaping services to your tenant.
3 Keep Lease at Market Value
Make sure that you update your lease so that it is at market value! Don’t slack off; when the market goes up, make sure that your property goes up with it. If you aren’t knowledgeable in property management, or aren’t interested in learning, hire someone who is. There are a lot of legal requirements that must be upheld. In some places, for instance, you can only increase rent to market value once a tenant has moved out.
4 Budget Properly
You must be prepared for expenses. Things will break. Renters will need plumbers to come in to check on things. They will need things fixed. They will need new keys because they have lost theirs. Things will leak, things will wear, things will happen. Consider your options and budget appropriately.
5 Manage Tenancy and Vacancy Properly
The easiest way to lose out on profit is by not staying on top of rent collection. Be hard on your tenants for late rent and evict them if they cause any trouble.
Being a landlord is difficult, but it can also be a rewarding and profitable experience. Renting is for those who are willing to invest their time to learn the trade and commit to the business. When you are ready to invest the time, effort, and money, a whole new world will be waiting for you!
All images from Khalkedon Penthouse by Studio Escape From Sofa