What if you want better cash flow from your rental properties? You can’t just raise the rents arbitrarily. If tenants leave, income goes down, not up. There are other ways, though, including the ones listed below.
- Install coin-operated washing machines. Even if you don’t have the money to do this yourself, you can find a company that will do it for you, and share the income with you.
- Rent extra parking space. When I got tired of a renter’s extra car, I just started charging a weekly fee. Then I didn’t mind so much.
- Raise the rent. Okay, we did dismiss ARBITRARY rent hikes as a cash-flow solution, but check on the rates for similar units. Are you renting at below-market rates?
- Rent storage sheds. Especially if your apartments are small, your renters may need a place to store their things. Don’t let them spend their money elsewhere. Put a few sheds on the property.
- Enforce late fees. It is perfectly fair to have a fee for late payment of rent, and guess what? Those who are chronically late usually don’t even mind – they just don’t look at these things the same way as others.
- Offer improvements for rent increases. If it’s worth $25 more monthly rent to a tenant, install that dishwasher. Even on a credit card, you’ll pay less than that per month for it.
- Install vending machines. If your rental properties are large enough, others will do this for you for free, and give you a share of the income.
- Rent by the room. A four-bedroom house might make more money if you include all the utilities and rent by the bedroom. This has made a lot of fortunes for investors in college towns. It does mean a lot of management, however.
- Rent-to-own sale. Usually, there’s a non-refundable deposit, and higher than market rents in these deals. When renters change their minds, as they often do, you got the deposit and better cash flow. This is great when poor cash flow makes you want to sell. You either sell or get the better cash flow as you repeat the process.
- Reduce expenses. Every dollar of expense you cut goes straight to the bottom line. List every expense of your rental properties, and look at them one at a time. How can you reduce them?
Those are some tips on how to increase your income. But if you are working with your financial advisor, seek advice from them or from their trusted insurance virtual assistant so that they can give you more tips and advice.
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