The goal of owning a rental property is to make money. It is important to to know what to do and what not to do to make your rental business successful. Being a landlord means paying for gas and electrical safety certificates, fitting smoke detectors, maintaining the property to a high standard to perhaps paying bigger tax bills. Part of being a successful landlord is always focusing on maximising your rental potential. This can be a tricky balance to achieve with so many legal obligations to meet.
Here are few ways to boost your rental income
KEEP THE PROPERTY IN GOOD CONDITION
Initially, taking good care of your property might cost you money, but it pays off in the long run. Landlords should be doing preventative maintenance to keep the property in good condition. Here are three ways to maintain your property:
- Replace old flooring and appliances with new ones to make the property more valuable and increase rent price.
- Fix repairs right away (especially leaks) because waiting makes the problem spread and increases the cost of repair.
Keeping the unit and building in good shape also encourages your tenants to do the same, which reduces expensive tenant turnover periods and costs.
You can minimize risk by keeping your property in good condition. Making sure your building is up to date and that the property is safe will reduce the risk of injury and lawsuits, which costs you money.
SCREEN YOUR TENANTS
To make sure you find a tenant who pays rent on time and takes care of your property, you should follow a thorough tenant referencing process.
- Host individual property viewings so you can get to know tenants
- Require a rental application to be filled in
- Require tenants authorize tenant credit reports and background checks
- Contact a tenant’s employer to verify income
- Contact prior landlords to learn about prior behavior
TREAT YOUR RENTAL PROPERTY LIKE A BUSINESS
Your rental property is a business, so it’s important to keep in mind your bottom line at all times and protect your business. Keep digital copies of everything, know the rules and regulations, and deal with tenants in a professional manner. Best practice is to answer calls, emails, and maintenance requests in a timely manner and act on them.
When you treat your rental property like a business, you maximize your profits because you’re making tenants happier by dealing with issues in a timely manner, avoiding legal battles, and keeping your finances in mind at all times.
HAVE LANDLORD INSURANCE
In the case of injury or lawsuits, you will need landlord insurances to protect your property. Some DIY landlords believe their homeowner’s insurance is sufficient, but if you’re consistently renting your property to tenants, then you are a landlord and need comprehensive coverage.
When you don’t have landlord insurance you risk high legal bills and having to cover the cost of damages. The cost of landlord insurance is small compared to the financial risks attached to it. Despite best efforts to keep your property in safe conditions, liability is still a possibility and having insurances in place is the best way to protect your rental business.
CHECK THAT THE RENT IS AT MARKET VALUE
Landlords are often accused of charging ‘extortionate’ rents, but in reality many landlords don’t regularly increase their rent to existing tenants. It is vital to keep the monthly rental payments as high as possible to maximise returns.
ATTRACT THE RIGHT TENANTS
Tenants who can afford to pay higher rents tend to go for a property at show home standards. A house offering a stunning modern kitchen coupled with a beautiful, contemporary bathroom can make the difference between attracting a minimum and a much higher-end rent. Upgrading your property doesn’t have to cost a fortune, but can be a worthwhile investment which ensures your property always lets quickly and for maximum rent.
A good agent knows that keeping your property occupied, with minimum void periods means more rental income for you. This requires an excellent agent-tenant relationship so that when tenants decide to leave, they provide with the correct notice period as stated on the tenancy agrement and are happy to let the agent arrange viewings for prospective tenants, and will ensure that the property is presentable.
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