{"id":8159,"date":"2018-02-08T15:15:08","date_gmt":"2018-02-08T23:15:08","guid":{"rendered":"http:\/\/www.roryc.ca\/blog\/?p=8159"},"modified":"2018-02-02T10:30:54","modified_gmt":"2018-02-02T18:30:54","slug":"how-to-improve-rental-property-cash-flow","status":"publish","type":"post","link":"https:\/\/www.roryc.ca\/blog\/2018\/02\/how-to-improve-rental-property-cash-flow\/","title":{"rendered":"How to Improve Rental Property Cash Flow"},"content":{"rendered":"<p>&nbsp;<\/p>\n<p style=\"text-align: justify;\">The obvious goal of investment rental property is maximizing profits by minimizing costs. It doesn\u2019t take much experience in the business to realize the typical fixed costs are mortgage, taxes, insurance, maintenance, and a reserve fund for repairs and emergencies. A prudent investor does what he or she can to minimize these costs but there is a limit. When you are turning positive cash flow of eight to ten percent after these fixed costs, you have a decent rental investment. Then it becomes time to look at hidden costs and opportunities to further boost profits.<\/p>\n<p style=\"text-align: justify;\"><strong>1. Vacancies.<\/strong> Rental cash is your primary income so minimizing disruptions is key to maximizing profits. Not only does a vacancy mean no income but it also means you have to cover all of the fixed costs out of your pocket rather than from the rent check. Rental demand is currently high which means it doesn\u2019t take much effort on your part to reduce both turnover and the length of vacancies. You lengthen tenant stays by having desirable investment property and delivering excellent customer service \u2013 make repairs and keep obligations faster than required. Every time you have a turnover it costs you money sprucing the place up for a new tenant. When a tenant does notify you they are leaving, begin advertising for a new tenant immediately. There\u2019s seldom a reason you should go more than two days without a rent-paying tenant.<\/p>\n<p style=\"text-align: justify;\"><strong>2. Strategically increase rent.<\/strong> Do the math. Today\u2019s tight rental market doesn\u2019t mean you shouldn\u2019t raise rents to avoid vacancies. However, if the cost associated with a vacancy will cost you eight percent of your annual income, you\u2019re financially better off accepting a two or three percent rent increase even if the going rate in the neighborhood is a little higher. Raising rents two or three percent each year is less painful to tenants than a ten percent increase every two years. When you do need to bump the rent a little more, tie it to an improvement the tenant will enjoy and maintains\/improves the value of your property. Maybe a new coat of paint or new carpet.<\/p>\n<p style=\"text-align: justify;\"><strong>3. Collect the fees.<\/strong> Collecting money is a task that few landlords enjoy but this is what you are in business for. Your lease agreement should be clear about rent due dates, the amount of the late fee, and other fees such as security deposits and pet fees. Be respectful to your tenants but be sure they understand this is a business arrangement when they sign the lease. It\u2019s a good idea to verbally go over each item in the lease and have them initial all fees that apply. If the rent or other fees are paid late, don\u2019t just shrug your shoulders and tell them to pay on time next month. In writing, let them know the rent or fee is not considered paid in full until the late fee has been paid. If you let them get away without paying the late fee once, they\u2019ll develop a habit of paying late and not expecting to pay the late fee. If you\u2019re renting a duplex or other multi-unit property, the other tenants will expect the same lenient treatment.<\/p>\n<p style=\"text-align: justify;\"><strong>4. Manage your property manager.<\/strong> If you use a property management company, these are the people delivering customer service to your tenants as well as assuring you have a steady income from the property. Before selecting a property manager, check online reviews to learn what both tenants and other landlords say about the company as well as check references given by the company. Some property managers will try to nickel and dime you for services you assumed were included in the basic contract. Go over the contract in detail with the property manager before signing. Property managers that don\u2019t perform proper and prompt maintenance can end up costing you large repair bills. Ask for examples of how they perform maintenance as well as arrange for significant repairs. You might even check with their contractors about working relationships.<\/p>\n<p style=\"text-align: justify;\"><strong>5. Add income streams.<\/strong> Apartment buildings can provide additional income streams such as paid preferred parking, adding coin operated laundry, or possibly discounted TV\/internet service. Single family residences can consider offering lawn care and maid services.<\/p>\n<p style=\"text-align: justify;\">Being a savvy and highly profitable landlord isn\u2019t only about controlling as many properties as possible. There is money to be made by better managing the properties you already control.<\/p>\n<p><a href=\"http:\/\/realtybiznews.com\/5-tips-for-improving-rental-property-cash-flow\/98746645\/\" target=\"_blank\" rel=\"noopener\">5 Tips for Improving Rental Property Cash Flow<\/a> by Brian Kline | Realty Biz News<\/p>\n","protected":false},"excerpt":{"rendered":"<p>&nbsp; The obvious goal of investment rental property is maximizing profits by minimizing costs. It doesn\u2019t take much experience in the business to realize the typical fixed costs are mortgage, &hellip; [<a href=\"https:\/\/www.roryc.ca\/blog\/2018\/02\/how-to-improve-rental-property-cash-flow\/\">read more<\/a>]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13],"tags":[],"class_list":["post-8159","post","type-post","status-publish","format-standard","hentry","category-real-estate"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.7 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>How to Improve Rental Property Cash Flow &#8226; Rory C Real Estate | Oakwyn Realty<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.roryc.ca\/blog\/2018\/02\/how-to-improve-rental-property-cash-flow\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"How to Improve Rental Property Cash Flow &#8226; Rory C Real Estate | Oakwyn Realty\" \/>\n<meta name=\"twitter:description\" content=\"&nbsp; The obvious goal of investment rental property is maximizing profits by minimizing costs. 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