Leasing your apartment to tenants
Learn the ins and outs of the apartment leasing business
It is not likely the time could come when you must re-evaluate the type of tenants you have in your building. Chances are you will not own the property long enough to have rental problems due to economic changes in the area but you should be aware of what actions you can take if you are suddenly faced with continual vacancies.
First, analyze why you are having vacancies. Is your competition having the same problem? A general market slowdown is not as easy to cure, especially in the real estate industry. When, on the other hand, most of the buildings around you are staying full, take a look at your building. Does it need sprucing up? Do competitive apartments offer more than you do in terms of better or newer facilities for the same rent? Ask potential tenants why they are not interested in your apartment.
Decorating problems can be cured. Updating of appliances can also be accomplished although the capital expenditure is greater and requires careful study. You do not want to spend thousands of dollars on capital expenditure if it will not solve your vacancy problems.
Problems such as that competitive apartments have swimming pools or more floor space, cannot be corrected in your building. A small building cannot justify the cost of a swimming pool. Your only solution to major problems, such as these, may be to consider the "highest and best" for your building, without major alterations. What can you do to improve your rental picture?
Consider a change in the type of tenants you have. You may want to rent to couples with a child or pet. Perhaps, you can appeal to singles. Two working girls or men can often afford more rent than a young married couple. Maybe you will go for "swinging singles" building. If all else fails, you can also reduce rents until the rental market improves again.
Chances are, you'll never be faced with a major rental problem, but if the market does become "tight" and you end up with a couple of vacancies at the same time, do not panic. The worst thing you can do is to rent to an undesirable tenant just to keep the rent coming in. He may cause other tenantexpes to vacate and your problems will be multiplied.
The longer you are involved with the rental market, the better you will become at keepingyour units leased, even in a slow market. It is not as difficult as it appears.
Keep Abreast of the Real Estate (Apartment Leasing) Market
The most important thing you can do is keep abreast of the real estate market -pertaining to apartment leasing. You should know at all times what your competition is, what they are offering to potential tenants, and what rents they are charging.
Many areas have "hotel/motel" or "apartment owner's" associations. Consider joining such an association if it is available in your area. It is the easiest way to keep up with current rental market trends. Apartment owners will also help each other with tenant leads when their buildings are filled and another member has a vacancy.
Local newspapers and lending institutions often make comprehensive market studies. These studies can be obtained by you and will include such things as population trends, rent levels and area occupancies.
Check with you local county appraiser. His office may have an area rental market survey available, which is kept current.
In Broward County (Fort Lauderdale, Florida), for example, the appraiser's office publishes a comprehensive annual report of current market conditions including area vacancies, rent levels, and average operating costs of apartments, shopping centers, office buildings, etc. The report is updated monthly and is available, without charge, to residents in the county.
To sum up, you have invested a sizable amount of money in your real estate investment. You are now pretty much in control of you investment. It is up to you to know what is going on in the market place so that your property will produce to its maximum.
It is only through following these tips that you will be able to offer your property for sale at the appreciated price that you will expect. If you have kept your rent level current, if you have maintained your property well, if you have enjoyed an ever-increasing profit picture over five or so years, you are ready to consider moving up into a larger property and do business in a much larger apartment leasing business.