Vacancy can kill a real estate investor's profits quickly. An unoccupied rental home is losing money every day.
How can you avoid vacancy loss?
If you've ever discussed property management and real estate investing with us, you know we always emphasize two key factors for maximizing rental profitability—maintaining high occupancy rates and strategically increasing rents as property values appreciate.
Today, we are focusing on occupancy. Let’s discuss the best strategies for managing and reducing vacancy rates at your rental property.
Provide an Irresistible Rental Property
First, make sure you are providing an outstanding rental property.
Is this a home that well-qualified tenants are eager to rent, or is it something that mediocre tenants are willing to settle for?
The answer to that question will tell you a lot about what you can expect not only from vacancy but from tenants and property performance. Rental markets across the country are competitive, and your property has to stand out. It has to be the place where good, high-quality tenants want to live.
Curb Appeal
Curb appeal is the perfect starting point—it’s the first impression prospective tenants experience after viewing the listing online and deciding to schedule a visit. Making it count is essential, especially when minimizing vacancy and maintaining occupancy is a top priority.
Viewers of this file can see comments and suggestions
Make sure the landscaping is neat and healthy, and keep the front of the property welcoming and inviting. You want to have enough exterior lighting, and the parking lot or driveway should be in good condition.
Creating curb appeal is your opportunity to create an emotional connection. Give tenants a reason to see your home and rent it.
Clean and Functional Interiors
Next, make sure the home is perfectly clean. Everything needs to function the way it should. Of course the home is going to remain vacant if the kitchen is missing a refrigerator and none of the doors close properly. You won’t have a long vacancy period if it’s move-in ready from the moment you begin marketing it.
Investing in Upgrades and Updates
Modern tenants want modern homes. If you have not painted in a while or the floors are looking worn, make some essential improvements. Add amenities that good tenants find irresistible, such as smart home technology. A digital keypad, LED lights, video doorbells, and smart thermostats are all renovations that resonate with a demanding base of tenants.
Pricing Your Property Accurately and Competitively Avoids Long Vacancies
Pricing always impacts vacancy, and this is something that a lot of rental property owners tend to overlook. Be mindful of your pricing, and always let the market lead.
While it’s important to price your rental home as high as possible in order to maximize what you earn, you don’t want to over-price your property. This will only lead to a longer and more expensive vacancy period.
Tenants have access to most of the same pricing data that owners and landlords do. They’re not going to pay more than they have to for a home, especially if similar homes are available for less. When you price your property too high, you run the risk of leaving it vacant for longer.
Conduct a comparative analysis that shows you the rental values of properties similar to yours in the immediate neighborhood. Ideally, you’ll gather information about what those homes rented for and how long they were on the market. This will help you establish the right price for your own property.
If you’re having trouble accessing the data you need, reach out to a property management team, like ours, that knows the local market and gathers insights and analytics regularly.
Consider Allowing Pets
We understand that pets can be a concern, and it’s why many Owners hesitate to allow them. However, properties with no-pet policies often face longer vacancies, as more than half of prospective tenants have at least one pet. By allowing pets, you can tap into a larger tenant pool, reduce vacancy, and even increase cash flow through pet rent. You don’t have to allow every type of pet—implement a clear and sensible pet policy that emphasizes well-behaved animals. Be sure your marketing highlights your pet-friendly approach to attract more interest and fill vacancies faster.
Strategic Marketing Reduces Vacancy
Marketing is also a big part of avoiding vacancies. If you’re simply throwing up a yard sign or posting a brief listing on one or two sites without any pictures, you aren’t going to rent your home quickly.
A successful rental listing starts with high-quality photos that form the foundation of an effective marketing campaign. Use ample lighting and capture every key area, including bedrooms, the kitchen, and any outdoor spaces. Since tenants typically focus on photos first when searching for a home, it’s essential to make a strong visual impression.
We always recommend listing rental homes on all the popular rental websites, including Zumper, Zillow, HotPads, and Rentals.com. Attracting as much exposure for your property as possible will generate interest and limit vacancy.
Respond promptly to inquiries from prospective tenants, accommodating their schedules for showings whenever possible. Be ready to address any questions they may have and provide an application to streamline the process.
Focus on Tenant Retention
The best way to avoid vacancy is by holding onto the tenants you currently have in place. We talk about retention all the time and how it contributes to a more profitable experience for owners and investors. Provide a great rental experience by remaining responsive and accessible. Communicate with your residents. Make sure they have all the conveniences they need, including online rental payments and access to good maintenance services.
Contact us at EPOC Property Management. We’ll talk about how reducing vacancies increases your profitability and net operating income. We’ll also take a strategic look at your property and make some customized recommendations that may help you avoid or at least reduce your existing vacancy rate.
