There's no denying it: renting out apartments and homes can be incredibly lucrative. Unfortunately, though, real estate isn't all about turning a profit. Many times, you can find yourself pouring your profits back into your investment. While it's true that you've gotta spend money to make money, it's also important to spend your funds wisely. Scott Safadi of Cal Bay Property Management recommends cutting costs in the following categories when possible:
Generally speaking, the more proactive you are, the more affordable it will be to maintain your property. With that in mind, consider replacing your regular light bulbs with LED versions. While more expensive upfront, this investment will pay off in reduced labor costs in a big way. LED light bulbs last much longer than the normal kind, which means less work for your maintenance crew.
While you're at it, make sure that windows and doors are tightly sealed. Even a small crack can let frigid air in during the winter and allow cool air to escape in the summertime. Not only will you save on your electric bill, you'll keep your tenants happy! Another option? Consider turning down your hot water heater. A major drain on a home's energy, the hot water heater can account for around 14 percent of your energy costs!
Who handles your phones? Consider outsourcing this role to a call center or answering service. Not only will you save on paying for an employee's healthcare, sick leave and vacation days, you'll also increase your availability for tenants. Because most answering services operate around the clock, you'll never have to worry about walking in to a full voicemail first thing in the morning.
Reduce turnover by making your tenants feel like they're part of the family. It's expensive to constantly hire new employees. Not only do you waste valuable time in advertising the position, interviewing and training new employees, but you present an image to the world that suggests an unhappy staff. Indeed, turnover is rarely a good thing. Instead, invest in only the highest quality candidates and respect their voices. You'd be surprised how being kind and supportive can help save you money.
In the modern era, there are more free ways than ever to get your vacancies shared with the world. While that's not to say you should never pay for a Facebook ad, there's a lot you and your team can do to save cash while advertising your community. Work with a digital marketing expert to ensure you're spending your marketing budget wisely.
- Scott Safadi, Cal Bay Property Management
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