Whether you own a condominium, townhouse, duplex or single-family home maximizing your earnings is always a high priority for any property investor. One of best times to invest in your properties is when a tenant has moved out and your property is vacant.
Implementing a good year-round maintenance checklist is a superb way to protect your investment, lengthen the life span of your HVAC products and make sure your renter are comfortable and safe. On top of that, updating outdated paint, cleaning and shampooing the carpets, and making an minor repairs is a smart way to keep you property looking good. However, doing the minimum amount of updates to the property will usually lead to minimal results in terms of how appealing a property is to potential renters and how much you can charge for rent.
When dealing with rental property, there are three goals every investor seeking to grow their stock portfolio should consider:
- Maximum rent
- Minimize working expenses
- Increase the resale value
Upgrading in Your Rental Property – the Right Way
In order to obtain the best return on investment, stay at the top quality of the rental rates, improve your property value and steer clear of tenant turnover every lease term, you will need to purchase the right upgrades that will entice tenants to stay through multiple lease cycles. As long as your local rental home is structurally sound and in good shape, then you only need to include a few updates to help your rental property be stand out from the pack.
Updating features of your rental home like the insulation, furnace, AC unites and appliances are just some of the ways you can make your listing stand out from others in the market and get it rented faster, which ultimately saves you money.
Know Who Your Ideal Tenant is Before They Move In
Knowing the ideal tenant you want to live in your rental property is key to making updates to the property that will entice them to move in. One great way to do some of this research is to visit open properties in the region and chat with local realtors. Ask them about the must-have top features of homes for sale and homes being renting that tenants are looking for. Find out why they are they choosing to live in this area (is it a local school, quick access to transportation or various other feature that is bringing in them to the region)? Does the typical local renter have kids, pets, or are they elderly people or students?
Once you have a good sense of who the region is attracting, walk around and speak to people in the area. When you’re chatting with residents in the area, find out where they work, what they like about the region and other standard information. You can tell people you are considering buying in the area, and often they are happy to share the things they like and don’t like about the region.
You should also pay close attention to apartment buildings that are without vacancy. Where are they located – perhaps near a subway or bus stop or across from a area? Do the systems have any special amenities? This will give you a good idea of what people in the area are currently and why they chose that property.
Do this regularly for a month or two and it will become apparent what it is that tenants in the region are hungry for. You may learn that ac units are a critical feature for a rental, or maybe it’s two-bedroom units with dishwashers that are super popular, or possibly it’s the three-bedroom homes near the senior high school that always rent out quickly. Knowing these key bits if info will help you invest wisely in your next property.
Invest in Unique Selling Points for Your Property
This doesn’t mean you want to have a unique property – unique can indicate hard to rent and even harder to market in the future. What you want to do is ensure that the house you’re buying has appeal to your ideal tenant that other properties in the area may not have. You want to have something more enticing to state in your marketing efforts than this is a 3 bedroom and 2 bathroom home.
The more desirable a certain home feature is in your area, the more you should consider investing in it for your property. Some of the key features many renters look for are:
- Well insulated properties
- Central AC and heating
- Eat in kitchens
- Updates and eco-friendly furnaces
Though many of these desirable features of a home cost a lot up front, the long term value of them will quickly be seen when the property rents fast and tenants stay over multiple lease years. This way you have to spend less time finding good tenants and more time providing simple maintenance to the property and cashing in on your investment.
Work with Property Management Professionals
One of the best ways to get the most value from your rental property investment is to work with an experienced and reliable property management company They will not only be able to help you decide what upgrades to make for you property, but will also find quality tenants as well as provide on-going management and maintenance to the property.
Tenant screening can be a complex process, and when you don’t have sufficient experience in the real estate industry, you might end up choosing an awful tenant. The main problem with bad tenants is the fact that it can be very difficult to make sure they are leave your premises. Good property management companies have a reliable and confirmed screening process that helps them select tenants who’ll:
- Rent long-term
- Pay rent on time
- Minimise the deterioration of the property
- Cause fewer problems
On top of this, a good property manager will help you cope with the following responsibilities and stop your properties from staying vacant for too much time:
- Prepare the properties for rent – A property management company will know exactly what kind of improvements to make to your property to increase your revenue and get it rented fast.
- Determine the perfect rent rate – When your rent is too high for the market it can take too long to find tenants. Making the rent too low and you may be losing money on a monthly basis as well as attract less than desirable tenants. It is very important to find for the right price and doing that requires understanding of the neighborhood market, data on similar units, and usage of professional rental rate tools that only a property management company can do.
Overall, there are many factors that go into deciding how and when you should invest in upgrading your rental property. By hiring a professional property manager, you avoid a lot of that headache as they will take the helm by providing everything you need to make your rental property the most desirable on the market.