Set the rent price appropriately
Setting the rental price is the first crucial step in property investment. You should study the market prices, the location, and the amenities of the property carefully to determine its strengths and weaknesses. Avoid setting the price too low or too high, as this may make it difficult to find tenants or appear as if you’re desperate. Compare the rental prices in the same neighborhood and set the price at a moderate or slightly higher level than your competitors, but make sure it aligns with what tenants will receive.
Avoid reducing rent too much
Even if there’s a low demand for tenants or you want to rent out the property quickly, reducing the rent price drastically may not be the best solution. It can not only lead to income loss but also attract low-quality tenants or those looking for short-term accommodation, which could create problems in the long run. Instead of reducing rent, try offering other incentives that don’t impact your costs, such as free internet for a few months, complimentary appliances, utility bill discounts, or occasional cleaning services.
Clearly define conditions in the lease agreement
The lease agreement is crucial and should be detailed and comprehensive. Specify the terms and conditions that tenants must adhere to, including the start date, lease duration, security deposit, utility costs, payment methods, termination clauses, liability for damages, and renovation conditions. Both parties should sign and acknowledge the agreement to use as a reference in case of future issues.
Avoid tenants requesting rent reductions, offer alternatives instead
Some tenants may negotiate for rent reductions, and if it’s not significant, it’s best not to agree to it as it could lead to long-term income loss. Instead, propose other incentives that don’t impact your costs, such as those mentioned earlier. This can motivate tenants without sacrificing your income.
Conducting thorough tenant screening Screening tenants carefully from the beginning can greatly reduce problems later on.
Check their personal backgrounds, including occupation, income, employment history, previous rental records, or references to ensure they are reliable and capable of paying rent. You may also ask for supporting documents such as ID cards, pay slips, or employment contracts. Additionally, observe their behavior and communication to gauge their trustworthiness. If there are any risks or doubts, it’s better not to rent to them, even if there’s urgency.
Use trustworthy platforms or agents for rentals
In the digital age, renting through websites or online platforms can help you reach a wider and higher-quality tenant pool. However, make sure to choose reputable services with standard verification and data security systems to prevent fraud or misuse of information. Alternatively, using rental agents or agencies can help lighten your workload, but choose ones with a good reputation, experience, and suitable fees. Don’t rely entirely on them and always monitor their progress.