Posted by Property investment represents a significant opportunity for a consistent passive income stream, but it also requires investors to ensure that they have done extensive research into the type of investment they are interested in.
Increase The Rent
If you own and operate a rental property you could simply increase your rent to make more return on your investment per month, bare in mind that this may cause your tenants to move out of your rental property; potentially leaving you with a gap between tenants residing at your rental property, meaning you won’t be making money during this time. We would recommend having some savings to fall back on if this happens. Also if you currently have good tenants who always pay their rent on time and do not damage your property, you could risk replacing them with tenants who are not so considerate.
Provide Additional Services
Providing your tenants with additional services such as coin-operated washing machines and driers can make the lives of your tenants more convenient and leave you with additional income from your tenants. If you own a large apartment building with multiple different apartments you could even consider adding a vending machine to the foyer for even more income.
Read: What is Asset-Based Lending? Guide for Borrowers
Allow Pets
A lot of landlords do not allow people to rent their properties that plan to have pets residing in their properties, this can leave landlords that do accept pets with an opportunity to justify having a higher rent. If you are planning to do this you would also benefit from a set of clearly established rules for tenants with pets, such as what animals are allowed. You should also make tenants who have pets sign a legal document that states that the tenant is responsible for any damage caused by their pets, this will make it easier for you as a landlord to demand reparations from the tenant.
Stay On Top Of Maintainance
You as a landlord will not see your property nearly as often as if you lived there yourself, which is why you will benefit from creating a sense of open communication with your tenants; where they can report maintenance issues as they arise so that you can fix them swiftly for the benefit of your tenants, but also for your property as well. Certain maintenance issues such as those involving water leakages can cause significant damage to your property and leave you with high costs to remedy the issue. By dealing with issues as soon as you can you can lower your costs in the long term and keep your tenants happy.
Work With A Property Management Company
If you live a busy life and don’t have time to deal with your tenants working with a property management company can be a good option, especially when you rent out different properties. Property management companies will be your tenant’s first point of contact if issues arise, it will be up to the property management company to make small maintenance fixes to your property at the request of tenants and let you know if there are any larger issues.
Property management companies also collect rent from your tenants and deal with tenants who do not pay their rent on time. When a new tenant signs their lease they will be signing a document created by your property management company, While this document is being drafted you will be consulted along the way. Until finally both you and the property management company sign an official agreement. Property management companies typically charge around 8% of the rent of the property they are managing, so you will need to take this figure into account when deciding if working with a property management company is right for you.
Buy And Hold
You may even be doing this already without realising the benefits when it comes to selling your property. Property value increases gradually over time, meaning if you buy a property for a certain price today, your property value will have increased significantly in 20 years. To make the most of this you could wait to buy property when the property market is at its lowest, hold until the property market increases in the future and then consider selling your property that is now worth significantly more than what you bought it for. In 2024 the property market prices are currently still very high, but if you wait a few years until they start reducing you could save significantly.
Renovate Your Property
Did you know that making renovations to your property can increase your property value more than the cost of actually renovating the property, this sometimes leaves you with a tidy profit. You have to be tactical about your decision though, choosing home improvements that add a good chunk to your property value without breaking the bank in the process. For example, if you have an unused cloakroom on the ground floor of your property you could transform this room into another toilet for your property. This will cost you around £1500 but it can add up to £3000 to your property value.
Conclusion
Getting into property can create a lucrative income stream for you, but like every investment there are risks involved. Ensure that you have done extensive research into anything that you are planning to invest in. You should also watch out for property investment scams and ensure that you learn how to avoid them. If you do fall victim to an investment scam you can contact online scams recovery professionals who will be able to help you maximise the chances of you getting your money back.