The ultimate aim of every real estate investor is to make money. If you already own an investment property, you certainly want to have it bring you more returns. Here are six ways you can boost your rate of return.
Renovate Your Investment Property
Improving your investment property will enhance its appeal, thus attracting more renters or buyers. Identify the essential areas that need quick fixes and implement them professionally. Whether it’s a rental house or a property you bought for resale, repainting the ceiling and walls will go a long way.
Ensure the kitchen, bedroom, and bathrooms are attractive because they are the main rooms that sell a house. Cleaning the entire house and having properly fitting cabinets is also enough to draw somebody’s attention. After adding value to your property, increase the rent or resell it at a higher cost depending on the market trend.
Work with Experienced Agents
Experienced real estate agents understand the dynamics of your local market and will advise you accordingly. You shouldn’t just find an agent with many listings in your market, but one who is trustworthy. They should create a market plan to connect you with customers or renters.
If your agent is reliable, shelve some of your opinions and follow their advice. While you may have your preference and style, you will likely benefit more by following their expert tips. If you can achieve your goal of boosting your rate of returns, the rest shouldn’t worry you.
You want to make sure that the agents you are working with are representing reputable agencies and are providing credible information. Sometimes, shady agents can take advantage of clients who are not educated in the housing market so it is important to do a little background research before.
Price Your Property Appropriately
Some people rent their property at below-the-market rates, which is quite imprudent. After paying taxes, insurance, and maintenance costs, you will have very little in your pocket at the end of the year. If you want to attract renters, lure them by making your property appealing but not charging ridiculously low rents.
If you don’t know how to determine fair rents for your property, seek help from your agents. Although you can also utilize some online tools for the same, agents will do better because they advise you to increase rents to keep up with inflation. An example of doing some online price benchmarking could be when trying to find a home in Florida. Searching online for Homes for Sale in Ormond Beach, Florida is a tactic you can use to analyze the market trends and get a baseline price for homes in that area.
Advertise Your Property
Most brands are rethinking their marketing strategies to keep up with consumer behavior. To boost your ROI in the highly competitive market, embrace digital marketing. Hire professional photographers to capture clear photos of your neatly arranged property.
You can then send the photos to your agent and share them on your social media platforms. If your property is attractive, most people will be willing to rent it despite the high rents. Be careful to give honest information about your property, especially concerning security and structural integrity.
There are new 21st century ways to showcase your home also. There are 3D home displays that allow prospective buyers to virtually inspect the house. This is a great resource in today’s day and age, especially during the pandemic when buyers are weary about entering homes.
Take Advantage of Inflation
Inflation triggers increased demand for housing as the population keeps growing. A shortage in housing will be a reason to increase your rental charges. However, the trend will not continue forever, so you should know when to review the rents.
You can enjoy high returns provided the supply will keep having unpredictable paces. It will earn you higher returns because the mortgages will remain constant.
Reinvest Your Money
If you have a rental property that’s not giving you enough ROI, sell it and plow back the money. But, you should evaluate the market to know whether your property can sell fast. If it can, sell it ASAP and buy another.
You may need an expert to help you implement this idea. If it’s not viable, drop it and focus on other ways of enhancing your ROI. You don’t want to end up deeper in losses.
Boosting your ROI will require some effort and even money. Following the above tips will help you achieve your goal. But, you’ve to research to understand the market dynamics.