You may think that to raise your rental property income you can just raise rents. However, you can’t just raise the rents arbitrarily, because if tenants leave, income goes down, not up. Fortunately, there are other ways, including the ones listed below.
1. Consider raising the rent. We did dismiss ARBITRARY rent hikes as a cash-flow solution, but check on the rates for similar units. Are you renting at below-market rates?
2. Charge rent for extra parking space. I got tired of a renter’s extra car, so I just started charging a weekly fee. Then I didn’t mind so much.
3. Charge and enforce late fees. It’s perfectly fair to have a fee for late payment of rent, and guess what? Those who are chronically late usually don’t even mind – they just don’t look at these things the same way as others.
4. Storage shed rentals. If your apartments are small, your renters may need a place to store their things. Don’t let them spend their money elsewhere. Put a few sheds on the property and charge rent for them.
5. Coin-operated washing machines. If you don’t have the money to do this yourself, you can find a company that will install them for you, and share the income with you.
6. Sell on a rent-to-own contract. Typically, there’s a non-refundable deposit, and higher than market rents in these deals. When renters/buyers change their minds about buying, as they often do, you got the deposit and better cash flow. This is great when poor cash flow makes you want to sell. You either sell or get the better cash flow as you repeat the process.
7. Install vending machines. If your rental properties are large enough, others will do this for you for free, and give you a share of the income.
8. Rent by the room. A four-bedroom house might make more money if you include all the utilities and rent by the bedroom. This has made a lot of fortunes for investors in college towns. It does mean a lot of management, however.
9. Offer improvements for rent increases. If it’s worth $25 more monthly rent to a tenant, install that dishwasher. Even on a credit card you’ll pay less than that per month for it.
10. Reduce your expenses. List every expense of your rental properties, and look at them one at a time. How can you reduce them? Every cost cut goes straight to the bottom line of your rental property income.