Every investor wants to earn as much as possible on his or her rental property, and to maximize the ROI for your own investment, you need to make some smart decisions. Today, we’re sharing some of our tips on how to increase what you earn in both the short-term and the long-term.
Professional Management vs. Personal Management
It’s important that you treat your investment property like a business. Many landlords make the mistake of becoming personally and emotionally involved with their tenants and their property. For example:
When it comes to pricing your home, you have to focus on the market and review the competition. You cannot attach a rental price to the home based on what you feel the home is worth.
You don’t want to just pick the first tenant who applies to live at your home unless that tenant meets all of your criteria. Yes, you want to find a tenant as soon as possible so you can avoid vacancy costs, but you want to make sure you find a qualified tenant who will maintain your home and pay rent on time.
Pay Attention to Preventative Maintenance
It’s easy to lose money with maintenance mistakes. If you want to increase your ROI, you need to take care of small repairs immediately. It’s tempting to put off minor issues, such as dripping faucets or broken locks. But, if you ignore or defer the basic maintenance that’s needed, those problems are only going to grow more complex and more expensive. It’s not a good idea to ignore the things that are needed at your property. Even if it doesn’t seem like a big deal, fix what’s broken and replace what you need to replace. If you put off maintenance, it will cost you more in the long run and damage your rental income.
Not taking care of maintenance will also upset your tenants. If you don’t respond to their maintenance requests, they’ll be less likely to renew their lease at the end of the tenancy. Vacancy and turnover costs can be expensive, and you want to avoid them. So, be responsive to your tenant’s maintenance requests, and demonstrate that you are committed to providing a well-maintained home.
Conduct Regular Property Inspections
A lot of landlords make the mistake of not inspecting their properties. They think that if the tenant isn’t requesting any maintenance, everything must be fine. But, routine inspections are important and necessary. When you inspect your property, you can make sure that it’s being maintained to the standards you expect. You can also look for repairs that haven’t been reported and make sure that your tenant is following the terms of your lease. For example:
If you have a no-pet policy and a dog is running around, you’ll be able to address it with your tenants.
If you notice a small leak under a sink in a bedroom, you can take care of it before it becomes a major plumbing issue that leads to mold and rot.
We have a lot more advice to provide when you’re looking for ways to increase your ROI. If you have any questions about how we can help you, please contact us at A+ Realty Management.