Maintaining high occupancy rates is number four in the series covering “Four Core Fundamentals of Property Management.”
So what are the advantages?
🟢 .Increased revenue
🟢 Financial stability
It reduces uncertainty and gives better cash flow management for the landlord.
This short video explains why maintaining a high occupancy rate is so crucial to landlords.
TRANSCRIPT
The advantages are increased revenue and financial stability. It reduces uncertainty and gives the landlord better cash flow management.
With long-term tenants in place who look after the rental property, the overall condition of your property will generally improve compared to short-term tenants.
Long-term tenants are likelier to do more for a property, such as the gardens and the grounds. They feel secure and want to make the property their home.
Because there’s constant rent coming in, I find landlords are more willing to spend more money on maintenance, which means increased capital value.
So, for example, you have a tenant who has been renting your property for six years, and next door, property B, is similar to yours.
On average, the tenants stay 14 to 15 or 16 months. The difference means five tenants will move in and out while your tenant has lived next door. Now, both properties rent for 600 per week.
On average, property B has a one-week vacancy between reletting and getting new tenants in.
So, hypothetically, there’s an income loss of $3,000 over that six-year period.
Now, if there were an average of two weeks of downtime between tenants, the loss of income would be $6,000. But it doesn’t stop there. You’ve got costs for letting the property between tenants and a risk of more wear and tear with tenants moving in and out.
And there’s also a risk of selecting the wrong tenants, particularly in a rental market downturn. So make sure you’re looking after those long-term tenants.
Making life easier for landlords is our specialty.
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