Occupy your investment property in a timely and profitable manner

To maintain a positive ROI on any investment purchase, you have to have tenants, right?

RIGHT.

However, I often see many investors doing this process the wrong way! I constantly hear the stress and annoyance of landlords who are unable to rent out their property in a timely OR cost-effective manner. Stress kicks in, buyers remorse follows, and the drinking ensues (joke).

What can we do to ensure that our new investment is occupied at a desirable price with equally desirable tenants?

Become your own rental agent!

As a real estate agent, I’m sure I’d get burned for saying this, but the MLS is NOT the way to rent your property these days! This requires the additional expense of 10% of your net gross lease. Doesn’t it make sense to first save that amount and second pass those savings on? If you’re going to give that 10% to an agent, give it directly to your tenant! No, I don’t mean giving them a wad of cash for signing a lease, just demanding less deposit to get them to move in, isn’t that a motivator to choose your property over your competitors?

Do your research before you buy!

If this doesn’t sound like the most logical advice I can give… But it is true and often forgotten. DO NOT and I have to repeat – DO NOT buy an investment rental property without finding out what your lowest rental income will be. Forget greed and how much could you charge, how much can you get? Do your homework and find out, first, what current renters are paying in comparable units, and second, what comparable units are asking. Will the lowest amount you can expect make your ROI high? If not, move on.

Don’t get bogged down with credit and reference applications

Everyone deserves a second chance, right? Just because a prospect has bad credit or can’t provide proper references doesn’t make them a bad tenant. Yes, the default rate is higher, but I’ve also seen people with 760 credit scores go into foreclosure, we all have now. This may sound careless or reckless, but GO ON WITH YOUR INTRODUCTION. You have to judge your potential tenants by yourself, what feeling do you get from them? If it feels good, go ahead. There are no guarantees in life, sometimes we have to take chances on the underdog, when the odds are against us, however they may pay off handsomely! (do you want to go to the track?)

Keep your tenants happy

Again, it seems obvious, but this too is often forgotten. A happy tenant is a paying tenant as well as a courteous tenant. Do you remember the days of high school parties? If you were friends with the owner of the house, didn’t you take care of the house during the ruckus? However, if you were in a “strange” house, you spilled beer here, dented a wall there, whatever…it’s not my house. Tenants are of the same mindset, if they like you and understand that you respect them they will treat your home as their own and the reward for this is priceless!

For more tips, advice or ideas on how to occupy a rental property to the best of your ability, visit us at:

SFLA Investments