The world of real estate always promises high returns. In general, real estate investment returns should be around 8%. What if that’s not the case for you? Then, it’s time to reevaluate your strategy and management style and maximize your real estate earnings!
What comes to mind when you think about real estate? It’s surely renting out an apartment. Despite being the most popular method of earning, it’s not the only one. So, let’s look at other examples first and see if there’s anything you can add to your portfolio.
We can’t forget about the most popular and traditional way of making money on real estate – long-term rentals! If you’re renting an apartment and missing out on high returns, read ahead for essential tips.
All smart real estate investors who care about their properties check their future tenant’s habits and history. Sure, you can collect a security deposit. In the end, if your apartment is damaged, that money might not always cover the management expenses. Furthermore, you’ll end up in distress.
So, don’t neglect tenant screening. Check if your future tenant pays the bills and manages their credit history. Sometimes, you can ask to verify their income and criminal background. Tenant screening services can run a quality check for $15 or less – a small price for a calm mind and a profitable investment.
Paying cash or collecting checks can take a long time. Sometimes, tenants will come up with excuses to pay later, too. To avoid wasting your time and energy, switch to online payments.
Not only is that more comfortable for you and your tenants, but it can minimize emotional stress.
Rent is usually the biggest monthly payment and can affect mental health. So, the less time your tenants spend looking at and calculating their bills, the better. What’s the best solution? Automated payments! Those paying online are also less likely to pay late – a little bonus for the renter.
You can remind your tenants to switch out air filters or trim the trees every month, but there’s always a chance they’ll forget about it. While it’ll take longer, managing home maintenance is the best way to maximize your real estate earnings. Pay the most attention to appliances – you don’t know how your tenants use them.
You should invest some money into routine maintenance and check-up for big appliances. That includes furnaces, air conditioning units, sump pumps, refrigerators, ovens, washers, and dryers. A seasonal landscaper will also trim the trees and bushes, ensuring branches won’t ruin the property.
There’s yet another way to maximize your earnings – making money via micro jobs! Like flipping the property alone, you can use all your skills while conducting routine screenings and maintenance. Don’t have the needed mastery? Taking up side hustles is a way out. Explore the world of freelance tasks or even take paid surveys. These take just a few hours a week and can pay for small fix-up jobs.
All in all, real estate is a challenging investment. There are many ways to maximize your real estate profit, including property flipping, buying and holding, renting out raw land, and others. If you have long-term tenants, it's essential to manage the process.
In the end, make sure you get back more than you invest.
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