It’s a dilemma that every landlord has to face at some point…
When, and by how much, should I increase my rent?
On the one hand, you don’t want to scare away a great tenant by driving up the rent, but at the same time, you’ve invested in this property to make money.
We get it.
Which is why we’ve put together eight proven, time-tested strategies you can use to boost your rental income for all properties in your portfolio.
Strategy #1: Make little increases and make them often
By far the most successful way to hang on to good tenants and keep your rental returns climbing is to raise the rent by a small amount every six or 12 months, depending on the legislation in your state.
Don’t hit your tenants with a $50 per week rise out of the blue. You might find that their next communication with you is when you receive their ‘Notice to Vacate’.
Instead, try slowly increasing the rent by $5 or $10 per week over time. Each of these incremental increases will be affordable for your tenants, making them less likely to jump ship and leave you high and dry while you hunt for new tenants.
Strategy #2: Consider allowing pets
While laws in some states now make it illegal to discriminate against tenants with pets, many landlords still prefer their properties to remain animal-free.
If you’re willing to allow pets at your property, your goodwill could see you rake in extra rental income from a grateful tenant.
To ensure that your property is protected, consider inserting a clause into the lease covering damage by pets. You could even ask for a slightly larger bond amount.
Strategy #3: Give the property a makeover
It doesn’t have to be a super-expensive renovation with all the bells and whistles. Even just a fresh coat of paint or sparkling new taps could be enough to attract more tenants and bump up your asking rent.
And you can save the extra expense of a tradie by doing all these yourself.
The rooms that tenants tend to pay the most attention to are the bathroom and the kitchen. Make sure you focus your time and money on these areas.
Strategy #4: Know what tenants desire
This strategy is very closely aligned with Strategy #3 and is crucial when it comes to boosting your rental return.
It’s easy for landlords to get caught up and throw money into making improvements to their properties.
But unless you know specifically what tenants are looking for, you can’t possibly cater for it.
You could spend thousands repainting or installing a dishwasher, when an air conditioner may have made the property much more appealing.
Get feedback from your property manager about the must-have items on tenants’ checklists. Learn how you could make your property more attractive to prospective tenants.
Strategy #5: Keep on top of changes in the area
Has a new shopping centre or school been built near the property?
What about the nearby parkland and childcare centres?
Don’t forget to emphasise these when you advertise your next vacant property. Nearby amenity is crucial if you’re looking to attract new tenants.
Improvements to local services and infrastructure may also boost median figures in the suburb.
This is a great way to justify a boost to your rental income, and it doesn’t cost you a cent!
Strategy #6: Add a unique selling point
It’s worth considering adding something unique to your property to make it stand out from the rest in your suburb.
Have a look at rental listings in the area – how many properties have alfresco entertainment spaces or ducted air conditioning?
By adding something that other nearby properties don’t have, you will be able to justify charging slightly higher rent.
What you choose to add will depend on the location and your target tenant of course.
But by improving what your property has to offer, you could also begin to attract a whole new demographic.
One that has more spare cash to splash out on rent.
Strategy #7: Review your property manager
Property managers play a huge role in the success of your property portfolio, from how they handle repair requests to giving good rental advice.
If your tenants are fleeing after their lease has expired, it’s often a reflection of the property manager, not so much the rent you’re charging.
Regular reviews of your property manager are a great way to determine whether the one you’ve employed is giving you the best chance possible of charging premium rent.
Strategy #8: Consult the experts
Possibly one of the best things you can do is consult a property expert.
If you want to learn more about the value of property and how to dramatically boost your rental income, book in a time with the team at Adpen. No matter where you are, we’d love to help you on your property investment journey.