Looking to make more money from your rental property? Here are five practical and proven tips to do just that.
1. Charge for additional services
Increasing rental income by charging for additional maintenance services is, ultimately, a money-saving strategy.
For example, ask a tenant to pay more money for providing a service like regular lawn mowing and maintenance, Results Mentoring coach Brendan Kelly explains. “The lawn mowing might cost $10 a mow, but if you charge your tenant $15 extra per week for that service, that would give you an increase of $5 a week.”
2. Avoid call-out fees
Assuming your property is not too far away, avoiding call-out fees for minor repair and maintenance work is a money-saver.
There can be a $75 call-out fee for property managers, but they might be called out over something tiny, and it might happen 3 times a year, Empower Wealth’s Ben Kingsley says. “That adds up. Get your tenants to call you when there is a problem. If it is possible, DIY it but, if it is a major issue, get a tradesperson.”
3. Take greater control
Ensuring you have more control over what is spent on repairs by a property manager can make a big difference to your bank balance. According to Kelly, there is often a $2,000-$3,000 “don’t disturb the landlord” threshold whereby a property manager will go ahead with repairs if they come to less than the specified amount.
“If you wanted more control – and potentially less spending – then you could lower that threshold amount to, say, $500. That would mean you could then elect what you will actually spend on and how much.”
4. Risk management
Maintaining your landlords insurance is a savings protector. For an outlay of about $300 a dollars a year it protects you should natural disaster strike or tenancy problems arise.
Landlords insurance is worth every cent - plus it is tax deductible, Renting Smart’s Ben Levi says. “For example, if a tenant goes rogue it can take at least 3 weeks to deal with the problem so, if it is a property that earns high rental returns it can be well worth it to be insured.”
5. Thrifty tips
Once again, it can be difficult to calculate exactly how much particular strategies might help you to save. However, the following tips are well-worth observing and will further help your saving goals:
- Attend to any maintenance or repair problems immediately. Small problems left alone often become big problems – which cost more.
- Get several quotes for any necessary repair work. Analyse and consider what each quote is offering to provide.
- Cultivate good relationships with key tradespeople. The power of friendship can go a long way.
- Always charge tenants for the outgoings you are entitled to charge for. The main one to remember is water consumption.
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