In many areas the local rental market is outperforming the housing market. This continues what has been a trend that has been going on for the better part of the last decade. While increased demand has helped find tenants, increased competition is making it difficult keep them. Tenants have more rental options today than ever before. If you want to not only find, but retain, good tenants you must separate yourself from the competition. This doesn’t necessarily mean remodeling the kitchen, but your property must have something appealing that can help it stand out. By doing so you will not only see an increase in quality tenants, but tenants who are willing to pay more to live in your property. Here are five ways you can add value and increase demand in your rentals.
- Staging. First impressions mean just as much to renters as it does for buyers. Without getting people interested in the property they will find other rentals to look at. One of the best ways to generate interest is by staging your rental. On the surface this may sound like a crazy idea but in reality, could be the best thing you can do for your property. There are two strategies when it comes to staging. The first is to stage the property the next time it is vacant and take as many pictures as possible. These pictures can be used for multiple years on all the various social media platforms and property websites you use. The second strategy is staging every time you have a vacancy. This only works on high end properties where it makes sense financially. However you do it you should consider staging at some point. Pictures and videos of an empty property do not look nearly as appealing as one fully furnished.
- Furnishing. If your staging is successful inevitably you will be asked if the furniture comes with the rental. The first time you stage this is something that catches you off guard and you immediately say no. But in thinking about it furnishing the rental can make all the sense in the world. Prior to furnishing you need to consider your target market. If you are renting to students who most likely don’t have any furniture, a furnished unit immediately adds value. The same is the case if your target are young professionals, recently married and looking to rent as a bridge before buying. Adding furniture obviously adds an immediate expense but you will see a return for at least five years. A furnished unit should be one of the top selling points in your marketing. You should make it clear on your listing the savings associated with not having to buy a couch, TV, microwave and dining room table. If you are savvy enough you can accumulate most of these items on sale and store until the end of the lease.
- Add amenities. In hot rental markets there is not much separating rentals in the area. Most have a similar price, bedroom count and look pretty much the same. Here is where you need to get creative. You need to think outside the box on how you can give something while still maximizing your bottom line. One of the things you can do is add an amenity of value. If your property is in an area that is impacted by snow, adding snow removal can be a nice perk. When you run the numbers it still can make sense for you. Let’s say that you have an average sized driveway and can find someone to clear it for $40 every storm. Every winter is different but if you have to pay them six times a year you are out $240. By adding this you increase your monthly rent $50. At the end of the year you have added $600 in rent for a $240 expense. Even if you need to clear the driveway eight times a year you are still ahead of the game and you have a tenant who feels comfortable in your property.
- Washer/dryer. Every rental you own should have a working washer and dryer. This is no longer a nice perk to have, but rather an essential. Your tenants do not want to have to drag their clothes to a laundromat a few times a week. Most are willing to pay more simply to have a washer/dryer in their unit. If you have a basement there is a good chance there is a water hook up available. Even if you must clear some things out or if it is in the corner of the room, it is better than not having one at all. Fortunately, a decent washer and dryer can last years and provide a great return on investment.
- Garage access. There are many renters who only use the tenant as storage. This is a colossal waste of space. Cleaning out an old garage or updating it to make it useful can be a daunting task but is something that must be done. Spend the money, get a dumpster, and get to work. A tenant that has the ability to put their car in the garage will keep them there for years. Instead of scraping their windshield off every storm they can simply open the garage and go. This alone may be worth $50-$100 more a month.
There are plenty of small things you can do to add value to your rental. In hot markets you need to be proactive and one step ahead of your competition.