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How to Get the Most Money for Your Rental Property

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When you want to maximize the income potential on your rental property, the first and most important thing you can do is minimize vacancy. It’s well known that the longer your property is vacant, the more money you are going to lose. When you work towards keeping those vacancy periods to a minimum, there are a couple of things to consider.

First, a lot of owners like to do their own repairs. This is certainly understandable – why pay a vendor to do what you can do yourself? Doing your own repairs can save you money as long as you do them right away. If you don’t have the time to make those repairs quickly, your home is going to stay vacant longer. Maybe you only have weekends to do the work or one day per week. If that’s the case, it will actually save you money in the long run to have a vendor do the necessary work. It’s a deterrent during showings when there are repairs that need to be made. Every day your property is vacant, you’re losing that rental income.

You also have to set the correct rental price. Sometimes, just a difference of $50 will leave your property vacant longer. We tell owners that it’s okay to set your rental price at $50 or $100 above the market for one week. However, if you don’t get any hits from qualified tenants, you want to bring it back down to what the rent should be according to the market, and it will rent much quicker.

tenant screening - thumbnailWhen you get your applications in from interested tenants, it’s imperative to screen them properly. This will save you time and money in the long run and it will also save you from damage to your property. Stick to your guns on your qualification requirements and you’ll have great, high quality tenants.

Owners often ask if they’ll get more rent by changing the counters in the kitchen to granite or by remodeling the entire home. Typically, the answer is no. If the property looks clean and it really shines, it won’t matter if you have tile from the 1980s. As long as it’s clean and it looks good, you’ll get a good tenant. You won’t get that money back that you spend on an expensive remodel and granite countertops aren’t going to bring you $10,000 in extra rent.

If you have any questions on maximizing your rental income, or you’d like to discuss these tips in greater detail, please contact us at Sacramento Delta.

05-22-2020
How to Get the Most Money for Your Sacramento Rental Property
05-22-2020
Achieving the Highest ROI for your Rental Property as a Sacramento Landlord

Achieving a great return on investment, or ROI, is the goal of every rental property investor. We’ve invited Bob, a real estate agent with Keller Williams, to talk to us about ROI on today’s blog. We will often have people buying rental property ask us about whether a particular property will provide a good return. We’ve asked Bob to shed some light on what that means and how to increase your own ROI.

 

 

Understanding What Factors Impact ROI

 

Whether you’re buying an investment property or selling one you currently own, you’ll want to know what kind of value it holds on the market. Rental projections are important numbers, and so are numbers like what the property could rent for and how long it may remain vacant before you earn any money on it. Those are two key factors.

Other areas to look at when figuring out the ROI would be the costs to remodel or clean up the home before it’s ready for the rental market. You would have all of that answered after the property inspection or the home inspection was performed. Other items on the list that may impact your ROI include property tax including assessment taxes, management and maintenance fees, and insurance expenses. Once all that is put together on a spreadsheet, you should review it and maybe take it to an accountant or a CPA. The amount of ROI you can expect often depends on your financial situation at the time.
 

Working Together with Real Estate and Management Partners

Working with a Professional Property ManagementAt Sacramento Delta Property Management, we do not sell real estate. At Keller Williams, Bob helps people buy and sell homes. When you’re planning to buy a rental property and you need to know what you’ll have to spend and what you can expect in terms of rent and ROI, it’s important to talk to both of us. We each do different things every day, and you’ll need a lot of expertise in order to make the right decision and have a successful investment experience.

Keeping the buying and selling part of your transaction separate from the property management portion of your investment will help you gain as much expertise and as many resources as possible during this process. I love referring clients to Realtors when they want to buy something, because they really are experts at what they do. Bob knows how to buy and sell solid real estate property and he knows how to deal with non-owner occupied properties. He definitely gives us a lot of support on the investment side, which is great.

Property management that’s professional and experienced allows you to earn more on your rental property. We keep your tenants happy and paying rent. The last thing we want are hostile tenants. We want to get a good understanding of how they feel. Tenants are just as much a part of earning more ROI as your rental value and your vacancy rate.

We’d love to tell you more about how to earn a better return on your Sacramento investment property. Please contact us at Sacramento Delta Property Management.

11-21-2019
Sacramento Delta
01-14-2020

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