Owning a property rental is ideal for earning extra income and owning a prime asset you can sell later. However, please do not go into the rental business thinking it is a passive income earner. Being a landlord entails a lot of time, patience, and responsibility. It also requires you to be a savvy businessperson who makes sound, profitable decisions.
Even experienced rental property owners stop and ask themselves whether they are maximizing their profits. They are not out to exploit their tenants. They merely want to ensure they get the greatest possible return on their investments. If you are a landlord or are thinking about becoming one, here are ways to make extra income from a property rental business:If you are a landlord or are thinking about becoming one, here are ways to make extra income from a property rental business!Click To Tweet
Most landlords experience high tenant turnover, leaving their properties vacant for a month or two at a time. They lose out on income in those months while still incurring expenses.
It is proven that working with rental management companies like Evernest, Atlas Real Estate, and Cobalt Creek Property Management helps Denver’s landlords keep their properties occupied. Denver rental property owners who prefer to work with larger property management corporations can choose companies like Greystar Real Estate Partners LLC or BH Cos.
Working with property managers has several advantages. Prospective tenants with a dodgy rental history will not make it past the agent’s screening processes. In addition, property managers are not as susceptible to sad stories about late or unpaid rent as private landlords who allow tenants to get away with breaching their lease agreement’s terms and conditions.
Most importantly, property managers take a lot of the burdens of being a landlord from a rental property owner’s shoulders, giving them time and freedom to pursue other endeavors.
Equitable pricing on rental properties
Many landlords do not charge enough rent on their properties because they do not investigate current pricing trends. Others drop their prices because they cannot find tenants willing to pay the listed amount. Regardless of the reason, these landlords are cutting into their profit margins.
Property managers have their finger on the pulse of Denver’s rental market, knowing what prices are fair and likely to attract great tenants. They evaluate property values in the neighborhood and what other landlords charge for comparable rental homes in the area to determine a fair rental price. In short, these agents have waiting lists of tenants ready to pay the asking rental fee without question.
Furnished property rentals
Many renters prefer a furnished or semi-furnished rental home as they do not have furniture and appliances and lack the funds to buy them. You can charge a higher rental price by having furniture and appliances available should tenants want or need them.
Some landlords do not agree with this approach, saying that the damage costs incurred outweigh any profits. Others find it a great way to earn more money on their rental properties.
If you plan to offer a furnished or semi-furnished option, buy functional, high-quality items that will not cost too much to replace or repair should they be damaged. Landlords who own multiple properties keep their furniture and appliances in storage units when not in use. They supply what their tenant needs and charge extra for it.
These landlords conduct regular property inspections to monitor the condition of furnishings and appliances.
Consider advertising on your rental property
If your rental property is on a main route, local businesses might be eager to advertise on it. You can charge them a set amount for this privilege as a landlord. Ensure that you enter legally binding contracts with your advertising partners to protect each party’s rights. It would be best to inform prospective tenants about third-party advertising on the property.
Before becoming gung-ho about this option, inquire about municipal and county bylaws governing advertising on private property. Ensure that what you and the advertiser plan to do is legal before going ahead.
Many landlords find great success in boosting their rental income by offering additional services, such as cleaning and landscaping. Find service providers and negotiate a price with them. Once you discuss these extra services with your tenant, you can add a small profit margin by charging them a little more than you will pay the service provider.
Many tenants are relieved to pass the responsibility of finding someone to clean their home, run errands, mow their lawn, or walk their dogs on to someone else. They will also be likely to engage these services if they feel their landlord approves of the providers. Additionally, you will be creating jobs and supporting local businesses.