If you are an owner of a rental property, it’s expected that you would want it to earn as much as possible. To guide your profit maximization efforts, we present here some of the most effective property investment strategies that still work even up to this day.
Buy and sell
Many people call this property flipping. Buying a property at one price and selling it at another has been one of the most enduring property monetizing strategies around. Getting the right buying price is key to your success in this type of strategy. You also need to make sure that the costs of renovating or refurbishing the property will not exceed your budget.
Many are attracted to buy-and-sell because of its ability to generate a large sum of money in just one go. Truly, if you want to get rich overnight, then learning the ins and outs of buying and selling real estate is one thing that you can do.
However, this strategy is going to be very work intensive. You have to keep on haggling and you also need to have good marketing and selling skills. Money only comes when you are able to make sales. Also, getting a large sum of money quickly is not really a good thing for people who don’t know how to manage their finances well. Remember, earning money is one thing; making it last is another.
Take in students as renters
Targeting students, especially those that come from foreign lands, is a good way for you to enter this business. This property investment strategy is relatively easy because of the sheer number of students who are in need of a place to stay.
What’s good about taking students in is the fact that the length of their stay is often easy to determine. Most of them stay for as long as they are attending their respective colleges and universities; they leave once they graduate. With this, you can easily anticipate vacancies, making it a lot easier for you to determine the timing of your marketing efforts.
To further ensure that students get attracted to your property, you can incorporate some features that appeal so much to them: a study lounge and an easily accessible cafeteria.
One possible downside of having students as tenants is the relative uncertainty when it comes to their income and even academic sustenance. Some start out as a group of five, and one or two can drop out along the way. This makes lease payments a bit more challenging for those who are left behind.
Get commercial tenants
If you happen to be one of those who are lucky enough to own a property at the heart of a bustling metropolis or a really busy community, you will most probably pick between keeping a property residential or converting it to a commercial one.
Many property investors like commercial renters because contracts are usually long-term and space improvements are usually taken care of by the tenants. However, the commercial market is pretty sensitive to economic fluctuations. If, for example, a recession hits, spaces might be vacated and getting new tenants might be challenging.