The purpose of every investment is to get returns. In property investment, the investor gets his returns in either of two ways—sales or rents. He develops and sells outright or puts out the property for rent and waits for rental income.
Most investors avoid build-to-let properties for many reasons one of which is low yield from such properties. Another is the difficulty in collecting rents and the near-impossibility of recovering or foreclosing the property when the renter defaults repeatedly with payment.
But experts say there are ways or strategies landlords can make more rental income in spite of the pitfalls. According to Zulu Yusuf, managing partner at Starzij Realtors Limited, if these strategies are followed through, they can lead to 100 per cent increase in rental income.
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“As a landlord, the goal is to generate steady cash flow from your properties, but what if you could double that income? Doubling your rental income may seem ambitious, but with the right strategies, it’s entirely possible. Whether you’re just starting out or you’ve been in the game for a while, small adjustments can yield big rewards,” he assured.
Yusuf listed eight proven strategies through which landlords can double their rental income, urging them to learn how property upgrades, short-term rentals, rent-to-own options, and other smart techniques that can maximise profits and also enhance tenant satisfaction.
Upgrade your property
First things first, improving the condition of your property can significantly increase its rental value. A fresh coat of paint, modernized fixtures, and updated appliances can attract higher-paying tenants and justify a rent increase. Consider focusing on key areas like the kitchen and bathroom, as these are high-traffic areas that have the potential for significant upgrades.
Offer short-term rentals
Short-term rentals, such as Airbnb, can often generate more income than traditional leases, especially in desirable locations. The flexibility of renting out your property for shorter periods means you can adjust pricing based on demand, potentially earning much more during peak seasons like December. This strategy works particularly well for vacation spots, city centers, or areas near universities.
Explore rent-to-own options
This is not a popular option but very rewarding. A rent-to-own agreement allows tenants to rent with the option to purchase the property later. This model can be attractive to tenants who are looking to buy but need time to save for a down payment. In exchange for giving tenants the option to buy, landlords can often charge a premium on rent or receive a higher initial deposit. With this, he can lock in a higher sale price, which can be beneficial when it’s time to sell.
Add value with amenities
Offering additional amenities can justify higher rents and help you stand out in a competitive market. This could mean adding things like in-unit washers and dryers, high-speed internet, or even access to a shared gym or outdoor space. These extras not only attract quality tenants but can also lead to increased demand for your rental, giving you the opportunity to increase rent over time.
Rent to businesses or corporations
Renting your property to a business or corporation can provide a steady stream of income, especially if you’re located in an area with a high concentration of companies. Many businesses need housing for their employees, whether it’s for relocation or temporary assignments. Corporate leases typically come with longer terms and can command higher rent rates because companies are often willing to pay a premium for convenience and stability.
Increase rent strategically
Increasing rent is a straightforward way to boost your income, but it needs to be done with care. You don’t want to scare away your tenants, but regular, modest increases (in line with the market rate) are often welcomed by renters who are happy with their living situation.
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Leverage property management tools
Using property management software can streamline the rental process, from screening tenants to collecting rent. These tools can help you keep track of your income and expenses, optimize rent prices, and manage multiple properties more efficiently.
Be proactive with tenant retention
Finally, keeping your tenants happy is one of the best ways to ensure a steady income. The cost of vacancies—advertising, cleaning, repairs, and potential lost rent—can be significant. By maintaining positive relationships with your tenants, addressing maintenance issues promptly, and offering incentives for lease renewals (like discounted rent for longer terms), you can reduce turnover and ensure your property remains occupied, generating consistent income.
