Many property managers and rental property owners believe that increasing rent rates is the only way to improve profits at a property. Experienced property managers like Martin Feinberg understand though that too frequent rent increases can cause a spike in vacancy rates and quickly eat up any intended profits the rent hike might provide.
Before resorting to rent increases on properties, property managers need to first make sure they are getting the optimal price for the units they manage. When that has been achieved, property managers can then consider these three profit-boosting ideas.
- Upcharge for Amenities
One way that property managers can increase profits is by allowing renters to purchase some amenities a la carte. For popular amenities, it may be possible to actually gather more revenues this way than by bundling the offerings with the rent.
Property managers can also consider an upcharge for some of the following amenities: Nest or other smart home thermostats, on-site storage, covered parking, car wash, dog wash and play area, bike storage, recycling service, and trash valet.
Another option is to charge for group classes at an onsite fitness center, as research suggests that 76 percent of consumers ages 18-29 are likely to participate in gym-type activities such group fitness classes.
- Powerful Partnerships
Forming a partnership with local dog walkers, massage therapists, bike repair shops, cleaning services, laundry delivery, and the local gym is another way for property managers to boost profits.
Such partnerships can be a win-win for everyone. Property manager recommendations can bring customers to the local businesses while their businesses offer value-add (read: revenue-add) services to your property.
- Reduce Overhead
If a property manager has been with the same vendors and insurers for years, it’s could be time to get new price quotes and see if more competitive deals are possible.
Landscaping and maintenance is typically a good opportunity for cost savings. Revisiting a property’s watering system alone can be a good way to save money. Repair broken rain sensors and settings and identifying leaks as well as spouts that are damaged can add up to big savings in the long run.
Also, some older properties were designed before native landscaping became popular. Their grasses, shrubs, and plants may require higher maintenance than necessary. Replacing these design elements can offer savings in maintenance and watering over time.