Starting a rental business isn’t hard. What is hard is keeping a rental business growing, thriving, and turning a profit. You may have started with the duplex unit below yours or the third story of your home. Now, you’re ready to expand. Do you want to rent a home? A few condos? An apartment complex? Your rate of growth is up to you, but you should keep these tips in mind as you grow your rental business.
Know Your Target Markets
When you’re starting out with new apartments to rent, it’s important to know your target market. When you know who’s renting, you’re better equipped to set the rent range. You might have a gorgeous one-bedroom condominium, but if it’s near families or individuals with low incomes, you’ll have a harder time selling it. Knowing the demographic near your unit(s) will help you set the price range. Too low, and you might scare off the kind of tenants you’re looking for. (What’s wrong with it?) Too high, and you’ll have difficulty catering to your neighborhood.
Keep Meticulous Records
The more you grow, the more paperwork you’ll have to keep. Maintain a clean record of every detail, from repairs to maintenance cost, to utility bills, to vacancies. Keep an extra careful record for tax purposes. As the years go by, you can analyze your data to make informed decisions. Do you want to start including utilities in the rent? You’ll need to pick an average utility cost that doesn’t leave you in the lurch. Do you want to hire a property manager? You need to be able to estimate the amount of work they’ll do.
Find a Property Manager
A property manager would be an asset to your company, and the bigger you get, the more important it is to have one. A property manager handles everything for you, managing the properties and freeing up your time. With the extra room in your schedule, you can focus on acquiring new properties and increasing your investments.
Don’t Underestimate Operating Costs
When you rent a single unit, you deal with fewer problems. Your tenant might complain now and then, their dishwasher might break once during their lease, but for the most part, they’re happy, and so are you. The more units you rent, however, the more your operating costs will increase. For example, consider the cost of renovating an older building to turn into a rental property. The upfront cost is one thing, but you’ll run into extra repairs, like roof maintenance, electrical updates, and more before you’re able to rent the units.
Use Landlord Software
As you grow your rental properties, your needs will grow with them. The best way to handle your business needs is with a landlord software like Turbo Tenant. You can customize an online rental application, screen applicants, and post your properties all online by using the software. It’s easy, convenient, and goes with you wherever you go, and many 21st-century landlords find that a software program is a must for their day-to-day needs.