Every landlord and investor wants to see their property produce income. Maximizing a rental property's income can greatly improve its net operating income as well as its market value. There are several aspects that should be considered when trying to increase income.
TENANT SCREENING & TURNOVER
An empty property costs money, and so do problem tenants. Picking a well-vetted clientele will help reduce the chance of property damage or evictions, both of which can have steep prices. Also, proper tenant screening can reduce your amount of tenant turn over, with the aim to keep long term tenants and reduce the cost of downtime. If a unit does become vacant, it is important to fill that vacancy promptly, making sure that the new rental rate is on par with current market values.
CHOOSING MATERIALS THAT PAY YOU BACK
Choosing the right materials when repairing or remodeling units can increase the income a building generates. While a fair price is important, the elements that go into a building should also be of good quality so they can withstand tenant use. Solid plywood cabinetry and vinyl plank flooring can hold up to water, pets, and wear better than cheaper materials (and it is also preferred by most tenants).
PASSING OVER COSTS OF UTILITIES
Tenants can rack up large bills with older furnaces, boilers, plumbing fixtures, and electrical fixtures. Newer fixtures have much greater efficiency and will lessen your tenant-related utility costs. Going a step beyond improvements such as a new boiler or LED light fixture, a way to not only reduce utility costs but possibly eliminate them as well is to pass the bill onto the tenant. Having individually metered units can allow a landlord to either subdivide their bill or completely remove themselves from the equation and have tenants responsible for their own utility costs.
LAUNDRY FACILITIES
Collecting quarters isn't glamorous, but they add up quickly! A passive and easy way to collect income from tenants, laundry machines are the silent moneymakers and can increase income on an investment property with little effort. Well-working washers and dryers in clean and easily accessible on-site areas encourage tenants to use them instead of taking a trip to the laundromat. There are companies than loan their washers and dryers for a part of the profit, or landlords may purchase their own. Either way, it's an easy way to increase income for an investment property.
These are just a few of the ways that a property can be adjusted to increase the income it produces. For more ideas and tips, please reach out!