How can I maximize rent for my investment rental property?
Last post I began a two part series on maximizing rents by reviewing the importance of reducing vacancy and ensuring your property is market ready by increasing curb appeal. The next two factors can provide added rent value as well as help maintain market value.
- Quality maintenance and repair: Industry surveys consistently find that nearly one fifth of residents choose not to renew their lease due to poor response and quality of needed maintenance and repair. In other words, a landlord can reduce vacancy (expense) by simply responding to legitimate maintenance needs in a timely and professional manner. Residential real estate is a naturally depreciating asset. If it is not maintained it will most likely begin loosing market value. Regularly servicing heating and cooling equipment, sewer lines, gutters and other components of the house will help prevent more costly repairs. Keeping an investment property in good repair as needs arise prevents larger, deferred maintenance expenses and can also reduce liability exposure.
- Property upgrade: There are times when an investment property could use an upgrade. It may be as simple as a fresh coat of paint or as involved as a major remodel. Upgrades help ensure that your property remains competitive in the market place. Painting may be the most common and, perhaps, cost effective upgrade. An interior paint gives the property a fresh look and smell on the inside. An exterior paint can provide needed protection of the exterior surfaces (reduce future repair costs) but can also give the house a needed facelift. Changing exterior colors to a more contemporary color palette can have a remarkable effect on curb appeal and reduce vacancy costs. There are times when a more aggressive upgrade may be profitable to correct what is known as functional obsolescence. Common examples are adding a second bath to what was previously a 3 bedroom, 1 bath or adding a laundry room to accommodate full size washer/dryer plus folding area. The list can be endless so it is important to evaluate the market to determine if the upgrade will add market value to your property. The answer can be determined by a fairly simple calculation that considers the cost of the upgrade and resulting increase in net income and asset value.
Consult your tonsofrentals.com® property management professional for more detailed information about maximizing rents for your investment property.