Let’s face it—one of the main reasons landlords and investors enter into rental property management is due to how easy it can be to make a good chunk of change without having to do large amounts of work. Of course, being a Washington D.C. landlord is not entirely without work. Collecting rent, finding tenants, and addressing maintenance issues and tenant complaints may seem like relatively easy tasks, but this isn’t always the case. For most property owners, maintenance issues are the biggest threat to the bottom line.
While unexpected maintenance emergencies may cost quite a bit to solve, property owners who maximize the profitability of their rental properties can weather these costs much easier. You will find that some of these tips are best suited to multi-unit rental properties, while others are more applicable to single-family units. But any landlord in Washington D.C. can gain some actionable insights into achieving more profitable property ownership by following these:
1. Keep Rental Units Filled
An empty rental unit means no rental income. Washington D.C. rental property owners need to know how to market their rental properties effectively to fill every available unit. Most landlords should be able to find reputable online rental websites to post their rental listings. Local community newsletters and newspapers are another great and low-cost method for attracting tenants. Some landlords may want to consider incentivizing renters to move in by offering discounted security deposits, free gadgets, or other perks to new tenants. It’s also vital for landlords to price their rentals competitively. Undercutting a competing landlord by a small margin can make a tremendous difference to many potential tenants.
2. Charge Turnover Fees with Security Deposits
Most landlords charge tenants an initial security deposit when they sign their rental agreements, and the amount usually equals one month’s rent. However, every landlord will incur some amount of expense when a tenant moves out. Instead of typical security deposits, landlords should consider a smaller refundable one instead and charge a non-refundable turnover fee. This helps the landlord recoup any losses from a previous tenant moving out while incentivizing the new tenant with a more flexible security deposit arrangement.
3. Charge Pet Fees or Additional Pet Security Deposits
Many Washington D.C. landlords do not allow pets in their rental properties for obvious reasons: pets are generally messy and often leave stains. Some may even cause structural damage to a property, such as a large dog chewing through woodwork or cat urine seeping into the floors. If a landlord is open to allowing renters with pets, the landlord should charge an additional fee. This should typically include a pet deposit and/or a monthly fee on top of the tenant’s rent. The deposit can be useful if a tenant’s pet damages anything, and the monthly payments from pet-owning tenants can help offset any future costs for repairing pet-related damage. Landlords who decide to charge monthly fees should keep them reasonable; too high of a pet fee will cause pet-loving potential tenants to look elsewhere.
4. Have Tenants Pay Utilities
Some landlords attract tenants by including some utilities in their rental prices. Thanks to modern utility technology and equipment, it is now much easier to track utility usage in individual rental properties, especially apartment buildings and multi-family rental properties. Some landlords might find it easier to bundle in tenants’ utilities with their rent, but, ultimately, this costs those landlords money. If a landlord wants to increase rental unit profitability, it is best to require tenants to sign up for and pay for utilities themselves.
5. Install Coin-Operated Laundry Machines
While this tip only really applies to apartment complexes and multi-family rental properties, landlords should remember that laundry machines offer tenants more than just convenience. They also create a new small revenue stream from your rental property. Washington D.C. landlords should carefully research trustworthy vendors to provide maintenance and repair services when necessary. But investing in high-quality laundry machines means laundry fees could eventually pay for the cost of running and maintaining the machines themselves.
6. Consider Installing Vending Machines
Just like laundry machines, vending machines with snacks and beverages can amount to a profitable supplementary stream of income from a multi-unit rental property. Landlords should try to install them in or near laundry rooms; if tenants have coins for laundry, they may have a bit of extra change with them to grab a snack or drink while they wait. Also consider putting them near a gym or swimming pool facilities (if the rental property offers these amenities), the lobby, or the common areas residents pass through every day.
7. Handle Maintenance Yourself
Every Washington D.C. landlord should have a go-to list of vendors to call in case of an emergency. But there may be some minor things they can handle personally to save money. Landlords who feel comfortable performing small repairs can do so, but just like a landlord shouldn’t hire a vendor with questionable experience, the landlord shouldn’t attempt any repairs he or she doesn’t feel comfortable handling safely and efficiently. Jobs involving electrical wiring, plumbing, or HVAC systems should almost always go to professionals.
8. Take Advantage of Tax Deductions for Business Owners
Washington D.C. rental property owners should work with experienced tax professionals to find deductions to reduce their taxable income amounts. Property owners should save receipts for every business expense they incur, including maintenance charges, utility costs, advertising costs, and insurance premiums, to name a few. These could potentially qualify the landlord for valuable tax deductions.
All Washington D.C. property owners must know how to save money, however and wherever they can when it comes to running their properties. Ultimately, saving money is how most landlords make more money in the long run. These rental property tips can help virtually any Washington D.C. landlord find ways to save money and boost rental income from their rental properties. If you’re in the market for a property manager to help you with any of these tips, contact our team at Bay Property Management Group today.
