I have yet to meet a landlord that doesn’t want to increase rental property income. One of the best ways that I have found is by adding single family houses to your investment real estate portfolio. They are stable, good income producing properties with that tenants tend to be longer term and the buildings tend to have less management requirements. Unfortunately, if not managed correctly, they can also leave very little opportunity to improve your cash flow. Here are 7 ways that I can suggest to make a few more dollars each month from your single family investment properties:
- Work hard to lower your water bill by replacing all the toilets with low consumption models. Replace all the shower heads with low flow units. Check for any dripping or leaking faucets. Remove the outside faucets on the house (there is no need to water the grass at your investment property). Even though I never put the water bill in the tenant’s name, consider putting a stipulation in your lease that any water bills higher than $xx will be paid by the tenant.
- If the house has a garage, charge extra for it. Even $25 extra each month is worth it. Most Minnesota tenants, expect to pay extra for it.
- Eliminate “paying” the tenant or someone else to cut the grass and shovel the snow at your investment property. Charge market rent for the house and set those duties as just part of their responsibility.
- You have (or should have) a late fee; USE it! I make about $120-300 extra per month because I charge my tenants late fees when they don’t pay rent by the 5th. In fact, I have tenants that have paid late fees every month for years because they can’t get their life together. Also, I charge late fees on past due amounts.
- I don’t personally do this in Minnesota, but I know landlords in other states that actually rent some appliances to the tenants. Although not the norm, you could maybe rent some window AC units to them.
- Improve the property and then raise then rent. Work to put your investment property on the upper end of the rent curve and get “premium rent” because it is nicer.
- Change the property to “rent to own”. Typically a tenant that wants to own the property will pay $200-300 more per month that will be credited toward their down payment to buy the property in 2-4 years. Unfortunately, only about 50% of these tenants ever decided or qualify to buy your investment property, thereby forfeiting the additional rent they were paying. Do not set this up to prey on innocent people, but this is just reality and an option.
Implementing even a couple of these options may allow you to increase rental property income from your single family investment homes. Try them out and enjoy the extra cash flow!