Increase Those Rents

Posted on Friday, December 16 2011

How To Increase Rental Properties Income

We are now well and truly in the silly season both with regards to Santa and Christmas parties and also renewing tenancies and re- renting properties due to become empty over the next couple of months. Make sure you are giving your property a thorough rental appraisal. Landlords need to keep increasing the rents each year even when good tenants are staying on both to cover the ever increasing costs and to keep the value up on the property. When deciding on the appropriate rents, take a fresh look at the property. Is it getting a bit tatty and could do with a tidy up? Is it lagging behind with regards to facilities and features? Many landlords wear rose tinted glasses. They forget that wear and tear is inevitable and a newly renovated property is only newly renovated just after the renovation. Good tenants may stay on for a few years and we all dread the day that those tenants decide to move on. Quite often they could be retained by making small improvements each year rather than waiting for them to leave and having to do a major renovation to achieve good rents.

Giving good quality existing tenants a reduced rent increase is perfectly acceptable as long as they are getting increases. Tell them what you would charge new tenants and what you will charge them. They appreciate the couple of dollars a week they are saving and each year that will compound for them. Often tenants who have been in a property a few years have no idea what current rents are. They also forget that it is expensive to move house and reminding them of some of the costs is also a good idea.

Some landlords’ formulas for increasing rents consists of an arbitrary figure added each year but it is important to know what properties are actually renting for. If that requires paying for a rental appraisal every few years to help ensure you are up to date on current rents then that is a cheap way to gather the information. Many landlords only have one or two properties and it takes as much time with one or two properties to remain educated as it does if you own 20 or 30 properties and lets face it, very few of us have lots of spare time. Contact us if you require an appraisal in Dunedin. Enjoy the festive season.

Tania and Kyle Elmer
Directors
Mana Property Management Ltd

www.ManaProperty.co.nz

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Expert's Bio

Tania & Kyle Elmer

Tania & Kyle Elmer are active investors with a large portfolio of properties in Dunedin and Central Otago and mentor investors in the techniques used to grow wealth through property investing. Kyle and Tania are Co-directors of the Leading Property Mangers of New Zealand (LPMNZ). Kyle is a past president of the Otago Property Investors Association (OPIA). They founded Mana Property Management Ltd to provide specialist management services to Discerning Landlords dealing in the quality end of the market. www.ManaProperty.co.nz | Find Kyle on Google+

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