There’s no doubt that finding the right property is key, however, there are a number of important elements to consider when making the right property investment. Often there is an investment dream to buy real estate or realize cash flow without thinking through implementing the right strategic plan for a multifamily property.
Your strategies can affect:
- Real estate investment portfolio, returns.
- Operations, policies and procedures, which can create further returns.
- Ability to be proactive and anticipate rental trends.
- Exit strategies that maximize after-tax cash flow.
Investing in real estate has a lot to do with capital growth, so choosing a property that is likely to increase in value is the most important decision you will make.
Here are the three considerations:
1. Increase Net Income
To maximize the net income of your property, there are a few considerations you need to make. Raising property income will increase ROI. You should start by looking at a few income generation strategies.
These could be:
- Implement RUBS (Resident Utility Bill-back System).
- Raise Rents
- Change tenant profile (reposition resident base).
- Add new ancillary services and amenities.
- Implement new leasing policies
- Create a fee option system for pets, parking, and other ancillary fees.
- Upgrade suits.
2. Lower Property Expenses
- Hire better third-party management
- Rewrite operations procedures and policies
- Establish tenant retention strategies
- Conduct vendor and service provider reassessments
- Appeal property taxes.
- Shop new property insurance, look for discounts to industry.
3. Minimize Vacancies/ Increase Tenant Satisfaction/Retention?
Renters moving out, also known as turnover, can be very expensive for the owner in the form of lost income and make ready costs. Consequently, every renter you get to stay and renew their contract is money in your pocket that leads to financial growth. To do this, your strategy should be to create an environment in which renters do not want to leave. Don’t look at renters as tenants, but rather as residents. Create a community environment in which residents feel connected. The list of ways to do this is unlimited, but below are a few suggestions:
- The tenant is your customer.
- Think about how to build a long-term relationship.
- Taking a more proactive approach can be key to decreasing vacancy and increasing lease renewal rates for Vancouver multifamily properties.
- Provide free community-free wifi (internet) or other amenities.
With the right plan, it’s not difficult to outperform your competition. The best thing a new investor can do is fine-tune their strategies with a brokerage that specializes in multifamily real estate investments.
Have a conversation with the Klein Group Team about your investment strategies.
Call us – set up a meeting!
