Lower Your Vacancies
Vacant rooms drain your income until a new tenant agrees to your lease agreement.
Yes, well, no kidding, Einstein! Tell me other things I do not realize!
Alright, everybody, chill- I am going to tell you a few things that will take the anxiety out of you owning several vacant rooms and get you up and going as expeditiously as possible.
Besides the blatant costs to the ghost town you refer to as unit #2E loan, insurance, property taxes and all the power, there are additional costs you might not have conjured: Vandals, keeping that lawn free of weeds (aka lawn maintenance and sprucing up your ghost town to make it appear cheerful and pleasing to your next potential renter.
So, with no further waiting
Here are seven things you can do to eliminate your vacancies:
Consider Your Neighborhood
Your immediate area is different than every other immediate area on earth. How come? If you can not reply to this inquiry, it is the explanation you have higher vacancies than nearly everyone. What makes your immediate area unique? Does it have a swap meet you can walk to on Saturdays? Are youthful families relocating to the neighborhood (more so than in times past)? Even if you are the owner of a property in a not-so-hot region, notice something upbeat to market to your potential renters! Convenience store one block away that gives fifths in brown paper bags away half price the third Saturday of every month! Whatever you come up with, sell it! Make it work for you and your potential tenants! And if you do not realize, you must spend some quality time in the vicinity and really discover what makes it special.
Visibility
How often have you heard the phrase: Location, location, location? Precisely. Numerous times. Prior to investing in a rental dwelling expecting to sign a hot new lease agreement with a party, ponder how much foot traffic your property will have. Two of the buildings I deal with gets nothing but foot traffic (which saves me funds on marketing. If you are purchasing in a vicinity branded for it's character, make sure you make an investment in a building that is undoubtedly visible from the road.
Turn that Apartment Around Fast!
Be intelligent about your turn-arounds and learn to do it as expeditiously as possible. Make a easy list and schedule your sub-contractors to do their work as close together as possible. For instance, when I am turning over an unit, my list goes something like this: Maintenance "make-ready" for all the work that has to be done during the weekend taking off lights, removing fittings, etc.), new paint (you clearly want to leave the carpet cleaning/carpet installation after the paint has dried, new carpet or carpet cleaning, blinds and window replacement, switching out fixtures, etc. And lastly ending with janitorial cleaning. If I am hard-pressed I can do a complete turn-over in five to six days. How? Because I know the system and the sub-contractors and can rely on them- if one vendor shows up one day late, you have to reschedule your entire week's worth of sub-contractors. Learn and outline a time frame that works for you and keep the sub-contractors records and days they are arriving in plain sight. Call to confirm them the day before. It is your chore to make sure they show up- what does it cost them to not get the days mixed up? Exactly! nothing!
Having a fast turnover, puts cash in your bank account.
Know what to Charge for Your Unit!
If you are just estimating and do not really know what comparable rooms in your locality are renting for, you will be the one losing. I complete a easy "market survey". Shop your own neighborhood to find 3 to 5 units that are comparable in scope and the type of building. When they have vacancies, call the manager (keep their information because you will be calling every 3 months) and inquire what they are charging for their rooms. They do not know who you are or what you are doing - the information is invaluable in making sure you get that next lease agreement signed in a jiffy!
Market Your Vacancy Correctly!
Put yourself in the place of your potential renters. Who are you reaching out to? If you own in an Hispanic neighborhood, consider running your ads in a Spanish newspaper. As a property manager, we use computers all the time, but a lot of people don't- where is your potential renters likely to see your ad? Corner liquor store? (here we go again!), stock car race? Sometimes a perfectly placed ad can swarm your place with computer illiterate potential renters.
Consider an on-site property manager.
If you own multiple rooms all in the same neighborhood, you may want to consider hiring an on-site manager. Most of the time, buildings with on site management have faster turn-overs and thus, fewer vacancies. And in most states, buildings with a certain number of units or more HAVE to hire on-site management- know the law in your state.
If you hire a property manager to reside in your building and run your properties, they are going to learn all of the smooth moves mentioned above and save you time over the long haul. Do it! It's a good move!
Terms of the Rental Agreement
The longer the terms of the rental agreement 2 years versus 1, the fewer the number of vacancies. So, who wants to sign a longer lease agreement? I will tell you who- tenants you dangle sweet tasty morsels in front of- why not offer a 1 year at a certain price and a 2-year at a slightly lower price. In this world of commitment-phobes, you have to offer them something to get them to want to stay longer!
What if you give them a fifty dollar per month discount if they choose a 2 year lease agreement? Or tell them, if they are willing to sign off on a 2-year agreement, you will agree to leave the rent the same - "lock it now, people!"
Come on now! It is not that demanding, is it? You have now learned eight Smooth Moves that can put some cash in your bank account!
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