If you’re the owner of a residential rental property, whether it’s a vacation rental, a regular residential home, or even your own home that you rent to travelers, then you need to make your property stand out amongst the others. The whole premise behind owning a rental property is to earn money from the tenants temporarily living there. You can’t make money if you don’t have tenants, and if you’re not making money on a rental property, you’re actually losing it. In order to ensure that travelers and others will want to rent your property, there are a few things that you should do.
Make sure you know how to price your property correctly.
How do you make money from rental properties? You do it by charging your tenants. With vacation rentals, and when renting your personal home or a room, you typically charge by the night, as it’s a short-term rental. If you own a residential property that you’re renting to a family or individual, you’ll likely charge a monthly fee, as it’s more of a long-term rental.
Pricing is important when it comes to rental properties. You don’t want to overprice your property on the listing. Yes, you want to make money, but most people are looking for a good deal at a reasonable price, and they usually know when they’re being ripped off. If you know that your property is worth the price, then it’s certainly fine to list it at a higher price.
The general rule of thumb for pricing a rental property is to charge between 0.8% and 1.1% of the home’s total value. If your property is valued at a considerably higher price, you should charge closer to 0.8%, whereas if your property is valued less, then you can probably get away with charging closer to 1.1% of the total value.
Take into consideration the location of your rental property.
This is something that can help you with determining how to price your listing. For example, if you own a beachfront property, you’re allowed to price it higher than a property in a suburban neighborhood. The reason is that beachfront homes are highly desired, but limited in number due to the fact that there is a small amount of land available to build houses in close proximity to a beach. Beachgoers also understand that beachfront rental properties tend to cost more money than other types of rentals.
Location can also be a selling point for your property. Whether it’s a cozy cabin in the woods or a high-rise condo in the center of a major city, describing the location of your property gives temporary home seekers an idea of what the environment is like where they’ll be staying. Don’t worry if you feel that your property is located in a boring area— what’s boring to you may be exciting to others. Just about every location has something worth attracting visitors.
Take advantage of interior design trends and photography.
There are several things realtors need to know to successfully sell homes to all types of people, and one of those things is marketing. One of the main things a realtor does prior to selling a home is staging it. A home has to look presentable and welcoming to its potential buyers, and the same goes for your rental property.
Any photos you take of your property should be taken in well-lit areas, and while staged, they should still reflect the reality of what your tenants are going to get. Don’t place certain things in a picture to capture attention, but not have it available for tenants when they’re staying on your property.
When it comes to decorating your property, you can take the location into consideration. For instance, beach houses are usually decorated with blues, greens, tans, and white— colors that are reminiscent of the beach. Cabins in the mountains tend to be decorated with browns, reds, and oranges— cozy colors. You’ll want the decor of your rental home to be warm and welcoming.
Other Types of Rental Properties
Once you’ve mastered making a profit off of your residential rental property, you can explore commercial properties, such as an apartment complex. Apartment complexes can be considered either residential or commercial (used for business purposes), or even mixed-use properties. Apartment complexes tend to have less risk than other residential rental properties due to the fact that they seldomly have a 0% vacancy rate. Apartments for rent in Chicago, they do cost more than your single-family rental properties, but there are loans for commercial properties available for those who want to expand their real estate portfolio.
Your main goal as a rental property owner is to be able to rent out your property in order to make money. This can be tough sometimes with residential properties, but these tips should help you to achieve a higher booking rate.
