Buying a rental property is a savvy financial move, but if you’re smart, you can really make it work for you. Use these tips for landlords to get more out of their properties and you’ll maximize your profits while minimizing your stress.
DIY if You Can
If you know your way around a hammer, you can save a lot of money on repairs, maintenance, upgrades, and more. While the rent coming in can help, your outgoing expenses can make or break you. If you have the time, you can paint the unit yourself in between tenants and keep up the landscaping. If you’d rather delegate, you can build relationships with local vendors who do excellent work at reasonable prices.
Screen for Great Tenants
Don’t let desperation lower your standards. It hurts to have a vacant unit, but there are no shortcuts to finding stable, respectful tenants. Don’t skip any steps of the background checks and stay alert during your interviews. Most renters out there will take care of your property and pay their rent on time. That has a direct impact on your quality of life. Those people are worth waiting for, even if another month passes.
Keep Your Great Tenants
Once you’ve rented to nightmare tenants, you’ll never take the good ones for granted again. If it’s a mutually beneficial arrangement, take the long view toward getting them to renew their lease. Check in with them periodically and ask for feedback. Respond to repair requests promptly. Maintain the property. And if you think they might be on the fence about staying, offer them an incentive like a home upgrade.
Monitor the Market
A rental property is a ticket to passive income, but don’t be too passive about it. One key tip for landlords to get more out of their properties is to keep tweaking your numbers. Keep an eye on comparable properties to see if their rents are fluctuating and adjust accordingly. If you feel justified in raising the rent, show potential tenants why they should pay more by replacing old appliances, adding a doorbell cam, or installing laundry facilities.
Optimize Your Tax Return
Unless you’re a financial whiz, the DIY approach shouldn’t apply to your taxes. A professional accountant can find allowable expenses you might not know about. Tax law changes all the time, too. If you deserve some money back, don’t leave it on the table.