8 ways to increase your rental income
By Isabelle Ladouceur-Séguin|4 min|October 2021
There are many reasons why you might want to increase your rental income. For example, you may own a property that is renting below market rate. Or you may just want a better return on investment.
Whatever your situation and budget, you'll likely find something that fits your needs in this list.
You'd be surprised how many tenants are willing to pay a premium to live in a comfortable, up-to-date unit. If your unit is outdated or in need of a little makeover, you could renovate it to target a more affluent clientele. And then raise the rent accordingly.
But be sure to prioritize work that will increase the value of your unit. And not just maintain the building.
Forget about re-roofing! The most profitable renovations are those that improve the quality of life of the tenants. Here are some examples.
Urban dwellings without air conditioning can become hot spots in the summer. With heat waves getting increasingly long and frequent, air conditioning is becoming a necessity.
Of course, many renters make do with a window unit. However, these air conditioners are cumbersome. In addition, they must be installed and removed every year. Not surprisingly, many tenants are willing to pay more to avoid this irritant.
Installing central air conditioning in your building can really pay off. It's an investment that attracts tenants who are looking for little luxuries - and who have the budget to splurge.
In dense neighborhoods, noise is everywhere. A good way to increase the comfort of your home is to make it soundproof. Providing a quiet environment for your tenants more than justifies a higher rent.
And there's no need to throw your walls down! Simply remove the existing siding, replace the insulation and add some acoustic panels.
Who doesn't want more storage? Even in small homes, it's often possible to redesign the space to add more.
In some cases, you can even create storage outside the home. For example, by building a shed outside to rent separately - similar to a parking lot. Or you could install lockers in the basement. And then offer them to your tenants as an option for a few dozen dollars a month.
2. Offer wireless Internet to tenants
If you own a multi-unit building, this is a win-win solution. Simply purchase an Internet package at a wholesale price, then include it in the rent. This way, tenants can take advantage of a great price... while still allowing you to make a profit.
3. Pass on the electricity bill to tenants
If a fixed electricity charge is included in the rent, tenants have no incentive to conserve energy. They may leave the lights on in rooms where they are not present. Or they may heat more than they need to in the winter.
Letting tenants pay for their own hydro costs is a good way to save money. Give it a try!
4. Get into temporary rentals
Short to medium term rentals can be very lucrative. This explains the popularity of Airbnb-type platforms in recent years.
To rent your home on a temporary basis, you need to furnish and equip it (towels, sheets, cooking supplies, etc.). Also, consider including amenities like wireless internet and cable.
Renting to tourists seems too complicated because of regulations? Know that many other groups use temporary accommodations! Here are some of the most common ones.
Some disasters require major renovations or even reconstruction. In those cases, disaster victims need temporary housing for the duration of the work. This usually takes a few weeks to a few months.
In most cases, insurance companies pay for relocation after a disaster. It goes without saying that this market offers a very attractive income potential for landlords.
Many students come to Quebec to study for a single term. Others stay longer, but will never need permanent housing.
Many have to relocate temporarily for work. Whether it is for a business trip, a short-term contract or professional training.
5. Provide appliances
Providing appliances offers several advantages. On the one hand, it allows you to rent your home for more money. On the other hand, you avoid the damage caused by the shifting of fridges, ovens, washers and dryers every time someones moves in or out.
6. Shop for your insurance coverage
When was the last time you looked into lowering your insurance costs? If it's been a few years, you might want to shop around for quotes from insurance companies. You may find a good deal!
Also, let your insurer know if you've renovated your rental property. This could result in lower insurance costs. Especially if the renovations have reduced the risk of loss or extend the life of the building.
7. Raise the rent each year
This is the long way around. It requires little or no investment, but a lot of patience.
By raising the rent consistently each year, you can go after higher revenues without much effort. And if your tenant is paying well below market, there's a good chance they'll accept the increase without flinching. Dare to ask!
8. Create a unit
Subdividing a unit or creating a basement unit is a great way to increase your rental income. But make sure you follow the regulations in your area. And the math to check if the investment is worth it.
It's easy to underestimate the cost of renovations. Between building permits, engineer or architect plans, labour and materials, cost overruns are common occurrences.
As we've seen, there are many ways to increase your rental income. Whether it's through targeted renovations, offering more amenities or saving on costs. You just have to be creative!
How do you make your rental unit more profitable?
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