How To Raise Income Without Touching Rents

Income drivers that you can use on your property to just maximize the efficiency of the building, you want to take into account, what other buildings are doing around you, because if you have 500 units around you that are not charging pet fees, then it may be hard for you to implement pet fees, because you may be trying to break the curve against all the competition around you.

However, in our case we had 600 units around our building that were all charging at $200-$250 non-refundable pet fee and 25 to 35 hours a month per pets and here's our lonely hundred units that the prior ownership decided what we're not going to have pets, so we're not going to take him on any of that income, funny enough, when we went and did our inspection and behold, we found eight units with pets, so it was income that they could have been getting, that they were saying they don't want and they're not going to have, but ultimately they had tenants that were bringing in pets regardless.

So day one of taking that on we implemented a 250-dollar non-refundable pet fee and a $25 for monthly pet fee and this was for dogs and cats and of course of certain breed dogs and weights, we want to make sure that we're not allowing certain breeds, that are going to be vicious in nature and that is really, of course, added torque. Sounds simple, but so many owners, landlords do not do this, you have to implement a proper screening and application process with that, you want to make sure that you have an application process and you're screening tenants and this is going to make all the difference because one of the biggest cost you're going to have is turning units, so if you're going to spend all your money turning a unit and then you're going to do very poor, because you're so desperate to get that tenant in there and you're going to put any tenant in there and you're going to find a month or in less time that this is the wrong tenant and then spend a couple of months and eviction, just to find if they damaged the unit.

And now you have to go forward and now we're going to make this unit again, so for the right point, go in there, make sure you're going to charge them the application fee, do a proper screening, proper background check, check into a recent employment, you want to check into other recent places they live to make sure that they weren't good actors, you want to have straight things, we don't want to see evictions on prior leases, we don't want to see felonies, we want to see a number of things on this. Our standpoint, we got to be careful of course, once you screen tenants and going through the application process and do your due diligence, then when you have them move in, you want to make sure you have a proper either deposit or first-month rent. Not skip on that it, it becomes easy just to say, this is what we do instead of just trying to make exceptions for everybody, because then you have to remember the last exception was and now you have all these different exceptions, so for us we don't do refundable deposit, we do moving fees and those moving fees go to our bottom line for just preparing a unit and with that, we do a surety bond on top of that and people might say, why would you do that, well, we do that because we charge less than someone would be putting away for a security deposit, so if there's create a positive it's $550 we do a $400 our moving fee and then a surety bond on top of that, which is generated around $75-$80 and that now covers up to one month's rent of damage.

We pass it on to the tenant and if you do the math, four hundred plus four, seventy-five, even though it's being paid out in their mine, it's cheaper than money that is five hundred fifty dollars that they may have to fight or have fought in the past a lot of other rentals that they've had because maybe they've nicked the wall with a chair or something and then that landlords trying to take away this money for fixing the wall, so another way we've increased our bottom line. You can also think outside the box, we had basements and with those basements, very cheap, early we were able to put in storage units and with no storage, now if it costs us twenty-five hundred hours to put in ten storage units and if we're renting them out at twenty-five dollars a month, you do the math, we have our money back pretty quickly and at very good return on investment, for doing 25 hours a month, ten storage units across the board, you're basically making a complete return on your investment over a year.

Other ways to think outside of it, if you have difficulty in parking lots of units, difficulty in parking, you may be able to charge for reserve spots that are closer to units or if you're in areas that have lots of sun, adding covered parking to be able to set up for covered parking, there are certain areas that will really like valet or garbage valet, what that would mean is, that people will come around and collect your garbage, if they walk a half mile to the dumpster to throw out your garbage, so think about ways that you can utilize your property that are outside of. If it's an owner paid utility property, you could go back some of the utilities to the tenants and now take that off your lock and if an owner didn't do that before and surrounding buildings, think about how that can increase your bottom line, so you have to take into account what are the ways here that I can make this building better and improve it, whether it's from a mini standpoint or a function standpoint. Think about it from a tenant perspective, well if an owner just takes over and if somebody comes in here and says, well, I've done nothing, but you guys are under market on rent, so we're just going to increase your rents, how would you feel, you probably won’t feel great, but if someone comes in there, makes the property better and you improve it by putting in an application property process, if the tenant there is a good tenant, they'll appreciate that, because now you're bringing better tenants and creating a safer environment for them to live, whether it be with their family, friends, so think about it from that perspective, think what you can do to improve your property, will ultimately make it better for not only you but also your tenants.

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