What kind of returns are you expecting your Cleveland rental property to produce? Are you looking for the highest possible rents every month, or are you more concerned with long term appreciation and portfolio growth?
You have some specific investment goals, and no matter how unique those goals are to you as an investor, you’re likely trying to get the best return on your investment property, whether it’s a single-family home or a unit in a multi-family building.
We’ve been managing Cleveland rental properties for many years, and we have successfully implemented some leasing, management, and maintenance strategies that drive up ROI. We’re sharing those here, with 5 tips on getting the best return you can.
1. Pay Attention to Pricing
Rents are high right now, and we expect them to stay in a range that’s comfortable for owners who are trying to maximize their income. This is good news for you; the extra rent can help with higher maintenance costs and other expenses.
Setting the right rental value will ensure you’re earning what you should and not leaving money on the table. You want to charge tenants what they’re willing to pay and what the market will allow, but you don’t want to push too far. That will only result in a longer vacancy and potentially unqualified renters. Raising the rent too much during a renewal period might also chase away reliable tenants.
Take the temperature of the market because the right rental price will impact what you earn in the short and long term. Don’t sacrifice your ROI because you want to earn $100 more than you should every month.
2. Tenant Retention Earns More Money
There’s a lot of emphasis that’s often put on finding a tenant, screening a tenant, and placing a tenant.
All of that is important, of course. You need to make sure you’re working with a qualified resident who pays rent on time, helps you maintain your property, and doesn’t cost you additional money. Good tenants certainly contribute to better returns.
More important than finding that tenant however, is keeping that tenant.
When Cleveland tenants renew lease agreements year after year, you’re saving yourself from those expensive vacancy and turnover costs. This will go a long way towards increasing the returns you earn on your investment property.
Wondering how to put together a robust tenant retention plan? Here are some suggestions:
- Provide excellent and responsive communication.
- Be responsive when it comes to maintenance and repair issues.
- Remain flexible when necessary.
- Establish a set of consistent expectations at the beginning of the lease period.
- Keep rental increases reasonable when it’s time to renew.
Create and nurture positive working relationships with your tenants. This will make it easier to retain them and earn more on your investment.
3. Make Intentional and Cost-Effective Upgrades for your Cleveland Rental Property
If your Cleveland investment property is well-maintained, you’re in a good position to earn as much as possible from it. There’s no need to overspend on pricey renovations and rehabs. A great way to maximize your return, however, is to make a few minor and cost-effective updates and upgrades. You’ll find these improvements can immediately increase rental value and attract higher quality tenants. All of this leads to better ROI.
- New appliances are an outstanding feature. It’s better to replace those appliances that are old, leaking, and in frequent need of repair. Consider energy-efficient models and invest in stainless steel if you really want to increase what you earn. Even if you don’t go with high end appliances, you’ll provide a modern, streamlined look to your kitchen which tenants will appreciate.
- Consider new fixtures. Upgrade the showerheads in the showers and install shiny, new faucets and hardware on all the sinks, drawers, and cabinets. These improvements will get attention, and they don’t cost a lot.
- Replacing old, worn carpet with laminate or tile is worth the investment. You’ll earn more in rent and you’ll attract tenants who are looking for low-maintenance floors. That’s more money for you.
You earn more in the long term by making these improvements because it allows you to charge more in rent, even as your mortgage payment doesn’t change. That allows you to pay down your debt faster (actually, it’s your tenants who are paying down most of that debt for you).
4. Avoid Deferred Maintenance & Prioritize Preventative Maintenance
Take a preventative approach to maintenance. This is not only good for the condition of your investment property, it’s absolutely necessary for your ROI.
Conduct inspections whenever you have the opportunity in order to catch any deferred or unreported maintenance issues that need attention. Schedule a maintenance walk-through during the tenancy so you can check on your HVAC system, plumbing, roof, and other functions of your property.
When you have an experienced professional property manager conducting these inspections, you’ll get a good idea of what kind of work may be needed down the road. It can help you budget for ongoing maintenance expenses and plan for larger repairs.
This type of preventative planning will earn you more money on your investment because you’ll be thinking about the long term income and expenses versus the short term, unexpected emergency costs. Schedule an HVAC tech to check your system annually. Keep up with pest control. Winterize your home thoroughly and clean the gutters twice a year.
5. Better Cleveland Property Management Leads to Better ROI
Smart investors know that professional Cleveland property management leads to better returns on your investment. You’ll earn more with the careful and experienced attention your property receives from a good management partner. You’ll spend less on maintenance and vacancy, and you’ll be at less risk of making expensive legal mistakes.
Don’t lose money trying to manage everything yourself without the resources or the experience to be effective. Instead, partner with us.
Please contact us at Avalon Group Realty for help in driving up the returns on your investment. We serve the Cleveland metro area, including Kamm’s Corner, West Park, Fairview Park, Lakewood, Parma, Parma Heights, Bedford, and Bedford Heights.
