THE PROBLEM OF EMPTY RENTAL UNITS
Sometimes – and especially during times of economic uncertainty – it happens that rental units will stay empty for longer than you had anticipated. And this can be a problem, especially if you have to make mortgage payments on your property every month. So what can you do to minimize losses?
You have two choices. The first is to ride it out and wait until you can get a suitable tenant. The second is to consider collecting less rent just to keep money coming in.
If you choose the latter option, you’ll need to ask yourself whether or not you might be asking too much for the unit. In general, you need to know that renters are cost-conscious individuals who would rather have a little extra money after they’ve paid rent than know their money is going to a landlord.
Try lowering the price by a small increment (say, $25) and marketing the unit as a rent special. If that doesn’t do the trick, reduce the price again. Not getting the full price you want may make your budget tighter, but it’s usually much better to have an occupied unit that brings in money on a regular basis than a vacancy that drains your projected income.
Another strategy is to lessen the amount you’re asking for security deposit. But this can be risky. No matter how thoroughly your screening procedure, things can happen – such as illness or job loss – that can force a tenant into arrears. And a security deposit may be all you’ll be able to get to pay for missing rent.
At Herman Boswell, we understand how important your real estate investments are to you. Our team of professionals can help you come up with a plan to maximize tenant occupancy without compromising your financial future. When you need the know-how of the property management experts more North Texans trust, contact us!