The Five Keys to Maximizing Rental Income

March 26, 2010

Every property owner wants to maximize rental income and control expenses and vacancy times. With over 26 years of experience in the property management business we have seen what works and what doesn’t in all market conditions. Here are five important keys to maximizing property rental income in today’s rental market.

1. Reduce Vacancy Times

Unrented property means no income – every day your property sits vacant you lose money. So it makes sense to keep the time between tenants as short as possible. An important step in doing this is making the property rental ready – taking care of all cleaning and maintenance issues quickly and as efficiently as possible.

Prior to the tenant moving, perform an inspection to assess the properties turnaround needs, allowing you to set your schedule in advance. Does the property need painting? Are there any major repairs that can be addressed while the tenant is still there? Does anything need to be ordered? Answering these questions will allow you expedite the turnaround process and minimize vacancy time. Tenants report “cleanliness” as a major criteria for selecting a rental. Identify and build relationships with good vendors and have them ready to go as soon as your current tenant moves out.

2. Price Rent According to Market Conditions

You could have the best unit in the best neighborhood, but if you are asking too much or too little, you won’t get a pool of qualified applicants. You must price your property according to market conditions. Conduct your own market analysis; research comparable units in the newspaper, on Craig’s List, local property management websites, etc.

3. Match Security Deposit to Market Conditions

In an up market it’s easier to get a larger security deposit – up to double the rent. In a soft market that is much harder – the security deposit might be equal to one month’s rent plus $100 or $200. Again, you have to adjust to current market conditions or your property will sit vacant.

4. Sort for Qualified Tenants

No property owner wants deadbeats or have to deal with frequently re-renting units. And yet if you don’t select tenants carefully this is what happens. Take the time to verify income, employment, credit history, eviction history, current/past rental history, etc. and you are much more likely to find quality tenants who pay rent on time and stay with you for a longer period of time.

5. Market Your Property.

Your property might be the best deal in town, but if no one knows about it then it will become the best kept secret! Take a proactive role in marketing your property to find qualified tenants. Post ads on Craig’s List, make flyers, place a sign in your front yard, put an ad in the newspaper, etc. In a soft market, such as the one we are currently experiencing consider making an offer to attract people. For example: 1/2 month free rent or spread security deposit over several payments.

To learn more about the many services offered by TenantFinders ™ please contact us 925.284.7200 by email at propinfo@tenantfinders.com or www.tenantfinders.com.

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