Managing costs is a huge part of being successful with your rental property investment. Expenses can quickly eat into your profit margins, and if you’re not prepared, they can empty out your reserves in a hurry.
With rising costs across the board, record inflation, and discerning tenants who expect the best from their rental units, keeping your books in balance is becoming an increasingly tall order. Here are some tips to help you rein in expenses while still offering a quality product to your tenants.
- Do as the data says – Track your expenses diligently and evaluate that data regularly. Knowing where your greatest expenses are occurring can help you make better decisions going forward.
- Make smart investments – Sometimes you have to spend more to save more. That’s our philosophy when it comes to certain equipment and upgrades. Investing in high-quality equipment for bigger items like water heaters and HVAC units can result in fewer breakdowns and repair expenses over the lifespan of the equipment, plus there will likely be savings on energy expenses to boot.
- Lease to good tenants – Sourcing quality tenants is important to reducing the number of issues (and expenses) you may encounter related to a given unit. We recommend screening potential tenants by evaluating these “Big Five” areas: credit history, criminal history, eviction history, rental history, and income.
- Hire a professional property management company – It may sound counter-intuitive but hiring experienced professionals who know the market and industry best practices can actually help you save money. Many will also manage and run reports for you, which you can then draw on as you make ownership decisions going forward.
While the expense side of owning rental properties is not as fun or glamorous as the income side, there are ways to keep those operating costs in control. To learn more about best practices for owning real estate investments in Franklin County, Ohio, please get in touch with us at RL Property Management.