Keep a Rental Property Consistently Profitable: A well-maintained rental property in a popular area can generate passive income for decades. However, when landlords adopt a fully hands-off approach to property management and regard important responsibilities as afterthoughts, the profitability of their properties can greatly diminish, regardless of how desirable their respective locations are. In other words, if long-term profitability is what you’re after, you’ll need to put in the work. Anyone looking to keep a rental property profitable for years to come can benefit from the following pointers.
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Create a Comfortable Living Experience for Tenants
Creating a comfortable living experience for your tenants can be conducive to profitability in a number of ways. For starters, it’s a direct contributor to high renter retention, and the more tenants you’re able to hang onto, the fewer empty units you’ll have – and the fewer empty units you have, the more rental income you’ll be taking in each month. Secondly, providing a comfortable living experience helps ensure favorable online feedback, which is essential to cultivating a positive professional reputation. The more positive feedback you and your property generate online, the more rental applications you’re liable to receive.
Make Maintenance a Priority
When setting out to create a comfortable living experience for your renters, you’d do well to regard property maintenance as a top priority. After all, rental properties that are rife with unaddressed maintenance issues are far from the most comfortable places to live, and the less attention you pay to maintenance, the less likely tenants are to stick around past their initial lease periods.
Furthermore, routinely ignoring maintenance problems can cause massive damage to the property itself. Even seemingly inconsequential issues can become larger – and costlier – problems if left alone for extended periods. With this in mind, make sure to hire knowledgeable, dependable maintenance personnel, especially if you’re overseeing a large multi-unit property. Properties that contain dozens – or hundreds – of units tend to require a much higher degree of maintenance than smaller single-family properties, and the absence of a full-time maintenance will very much be felt by anyone who resides in such a property.
Keep the Property Up to Code
Failing to keep a property up to code can come back to haunt you in a variety of ways. To start with, a property that isn’t up to code is liable to create a host of inconveniences for the people who reside within it. Secondly, regarding such matters as an afterthought may land you in legal trouble and possibly even result in your property being condemned. Needless to say, such outcomes can prove tremendously stressful, costly and damaging to your professional reputation.
With this in mind, make sure to have the property professionally inspected on a regular basis and promptly address any issues these inspections turn up. This process is likely to prove fairly easy in a municipality that utilizes a convenient code enforcement software program.
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Be Thorough in Your Applicant Screening
Tenants who are unable or unwilling to pay rent can severely hinder your rental property’s profitability. After all, it’s hard to generate income with units whose occupants aren’t paying rent. To further complicate matters, evicting tenants for nonpayment of rent can prove extremely difficult, stressful and time-consuming in certain areas.
That being the case, it’s strongly recommended that you subject all rental applicants to a thorough screening process. With each applicant’s permission, look into their credit scores, rental histories, employment histories, income situations and criminal backgrounds. You should also make a point of contacting any references applicants list. For the sake of accuracy, prioritize references who fall outside of an applicant’s family or friend circle, like employers and previous landlords. Should you lack the time or patience to personally carry out the screening process, entrust this task to a reliable screening service.
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Success is never a guarantee when investing in a rental property. While it’s true that some properties can function as perpetual moneymakers, this won’t be the case for every rental you stumble upon. Furthermore, no matter how much a property has to offer, poor management and upkeep can result in low renter retention and diminished profitability. As such, property owners looking to keep their rentals profitable for the foreseeable future would do well to heed the advice outlined above. A little bit of effort and attentiveness on your part can set the stage for decades of consistent returns.
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