Make the Most of Your Rental Property Investment
July 26, 2021 | by BMI Staff
With a new school season right around the corner, we’re in the middle of the rental property busy season. But with the challenges of 2020, we know that many landlords are looking for ways to make the most of their investments all year long. Here are some tips for maximizing your real estate investment, even when the busy season mellows out.
Accommodate the Reduced Demand
If you own a rental property, you probably know that a slight decline in movers will accompany the colder seasons ahead. In order to offset this dip in business, there are several ways in which you can work to make your property more enticing to renters. Though moving is far less common during the colder months, there will still be people in need of rentals. One way to stand out against your competition during this time is to reevaluate your rent price. If you’re able to lower it or throw in a lease-signing promotion for the first month, it might be just what you need to stand out. Loosening your rules (even if only for this season) may also entice more renters. Consider allowing pets for off-season renters if you don’t already or creating shorter lease terms to become more marketable.
Take Advantage of Vacancies
Although slower months reduce income for property owners, don’t miss out on the chance to take advantage of long-term vacancies. Do walkthroughs of your vacant properties and perform any repairs that may prevent later damage or even increase property value for the upcoming season (meaning more money in your pocket!). Winter is also a time for snow, which can cause a liability if not tended to. Make sure all outdoor maintenance is tended to, even at properties that are currently occupied. Are the walkways shoveled? Is there salt down on any icy patches?
High Utility Bills
Unless explicitly stated in the rental contract, tenants are usually aware that utilities are theirs to pay. What happens, though, when the slow season hits and some properties you manage are vacant? Those utilities still have to be turned on to avoid busted pipes and other weather-related damage to occur. You can get ahead of this cost increase by winterizing your properties prior to the first snowfall of the season.
Additionally, if you are including the cost of utilities in your tenant’s rent, make sure to look at the entire year of bills for each property. Are you charging enough to cover each season? Depending on your type of heating or cooling system, air conditioning may be way more cost effective than heat (or vice versa). Make sure to average out these costs before stating your rental price.
The best way to avoid serious tenant emergencies and to pay your own bills each month is to prepare. It’s easy to get caught up in the high-dollar busy season and assume the best, especially when just starting out. And even if the best does happen, and the seasons change seamlessly without any stalls in business, it still never hurts to have a plan of attack for those worst-case scenarios. One way to prepare yourself for any rental disaster is to make sure your commercial policy through BMI is airtight. Call your local agent today to discuss your policy!