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How do you maintain and increase the rental income from your properties? Start by keeping your renters happy. That's what the first two of these tips are about.
Happy Tenants Mean More Consistent Income
1. Find out why tenants leave. Sometimes it is just because of a job transfer or the need for a bigger apartment. But if it is because the neighborhood is becoming dangerous, or because the other tenants are too loud, these are things you need to know and to do something about. More turnover means less rental income, because it takes time to get those empty apartments rented. But to correct problems that lead to vacancies, you need to know what they are - so ask!
2. Talk to your tenants, and resolve any meaningful complaints as quickly as possible. The longer they stay, the less time you spend with empty apartments. If they want cheaper rent, let them know what others charge, and that you are competitive. But if they want a new carport and are willing to pay a little more per month for it, run the numbers. You might increase your income and have happier renters.
Rent Quickly
3. Rent that vacant apartment out quicker and you'll have more income for the year. One way to do this is to have a system in place and ready. Have the cleaning crew ready to go in the day the tenant moves out, and have advertisements ready to place in the paper the day before he moves out. Use a property manager if they are faster than you at turning an apartment around.
4. Another way to get those units rented out quickly is to have a ready supply of renters. For this, there are two things you can do. Keep files of recent (and qualified) applicants and call them when a unit becomes vacant. They might still be looking for a place. Keep in touch with other landlords and "trade" tenants. When they are full, they can refer renters to you, and you can do the same for them.
Other Ways To Protect And Boost Rental Income
5. The obvious way to increase that income is to raise the monthly rent you charge. You can't do this arbitrarily without losing tenants, but it may be worth checking the rents of comparable properties if you haven't done so in a while. If you raise rent to market level, or even a bit higher, tenants may not like it, but there won't be enough incentive for them to move. If you are raising to market or below, include examples of area rents in the letter notifying the tenants.
6. Noticed that four of the ways above are really about reducing vacancies in your rentals, or to look at it from the other perspective, they are about improving the occupancy rate. The more time those units are full the better (assuming the renters are paying). One way to accomplish this is to rent to people who stay longer. How do you know who will stay longer? Start by asking, and then rule out any who say, "This will do for now." But more important is their history. Those who have moved every eight months for years will likely continue that pattern, while the family that spent eight years at their last apartment will likely stay with you for a long time. That really helps keep that rental income consistent.
Copyright Steve Gillman. To see a photo of the house we bought for $17,500, and to get a Free Real Estate Investing Course, visit: http://www.HousesUnderFiftyThousand.com
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