A go-to option that will allow you to generate monthly income is to invest in a property you can rent out. This can provide a reliable source of income for you and help them to build equity. You can pay off the mortgage and other expenses with the rental income. The property can be a good long-term investment for you if its value increases over time and you can use it as part of an overall strategy to start building wealth.
Establish the potential rental yield
Potential rental yield is a primary concern when deciding whether you want to invest in a property for rental or not. The rental yield will be the annual rent you earn on the property divided by its value and expressed as a percentage. This is your gross yield calculated before costs like insurance, maintenance fees, etc. You also need to factor in costs like emergencies and taxes.
Using property management services can save you money and help you to make your investment more profitable. A property manager will find qualified tenants for you, collect rent, handle delinquencies, do preventative maintenance, and evict tenants if it becomes necessary. Maintain smooth property management services in Atlanta will get your home rented to quality tenants fast. Evernest, RentVision, and PFSuites offer a team of licensed property management professionals with extensive knowledge of the Atlanta real estate market.
Buy the right property
You need a realistic idea of market-related rentals in the area where you buy so you don’t overpay for the property. If you buy stupidly, you could battle to earn enough from rentals. The best way to determine whether a property is worth buying is to consider other property rentals in the same neighborhood. Visiting property-related online websites can help you to determine what prices are being charged etc.
Set a market-related rent
Setting a market-related rent will enable you to get tenants quickly. Set your rent too high and you may put off prospective tenants and sit for longer than necessary with a vacancy. Set it too low and you may battle to cover your expenses. Your rent also needs to increase yearly to keep up with inflation. Building regular rent increases into your lease agreement helps you to do this in a way tenants are prepared for so they can budget accordingly.
Make the right improvements
Property owners may spend money remodeling a home but neglect the outside apart from a quick paint job. A coat of fresh paint is a great way to add value but a well-manicured lawn and some landscaping can help you to achieve a higher rental or a quicker sale, both of which can make the value increase.
Making internal improvements must also be done according to what adds value for tenants. Converting a third bedroom into a study would be a mistake in a family home but could be useful for young, remote-working professionals. Adding a small half bath for several thousand dollars could attract more tenants and add more than several thousand dollars in value. Steps like tearing down some walls to create a more ‘open plan’ concept can offer immediate value.
Stay on top of maintenance
Routine maintenance must take place to ensure a property remains in good shape. There are various seasonal tasks that must be done, such as preparing pipes for winter and other appliance maintenance that must take place, such as servicing HVAC systems. Preventative maintenance is one of the best ways to extend the life of a property and avoid costly repairs.
The lease agreement should outline what tenants are responsible for and your responsibilities as the landlord. They need to know they can rely on you to respond quickly if they have maintenance requests. Having the right vendors and contractors on hand can help you keep costs down when maintenance issues occur. You don’t want to call around to find someone based on availability to handle an emergency, as this can be very costly. This is where using property management services with in-house teams can reduce costs.
Lower your expenses
The best way to increase the profitability of renting out a property is to reduce the expenses. You may think you can do this on your own but in many cases, using property management services is the best way to lower your expenses. Apart from getting maintenance done regularly and at lower costs, simply collecting rent on time, following proper procedures to handle late rent, and evicting tenants if necessary can save you money.
Property management services are aware of all the landlord-tenant laws and can prevent you from incurring legal costs due to ignorance and breaking the law. Regular preventative maintenance could go a long way to saving you money. Dripping taps, for instance, could greatly increase your water bills.