So, what can you do to increase the value of returns, and decrease the debt-ratio?
Jason Hartman’s tips allow even the novice investor to take over as a game changer. These practical solutions will help increase the value of a housing complex, whether it’s three units, or over 100:
Curb Appeal – Check if the exterior matches the upscale interior of each unit. If not, hire a landscaping company to quickly transform the outdoor space.
Marketing – Which amenities will appeal to the target market? Play on this angle and highlight features in every marketing material. For instance, in a society that’s more eco-conscious and frugal than ever before, a metro rail, bus route, or biking path close to the building will appeal to this sector. These features also help to save renters money on travel. A home is a haven, and a large percent of the population will spare extra income to live in a comfortable space. With that being said, what other investments can be made to add the value of appeal? Continue reading below.
Flooring – A complete overhaul of old floors will make a room look brand new. With budget-friendly options available, new flooring can easily reform an historical building into a renovated one. Even if you’re not the remodeling type, there are flooring options which can be self-installed. Quick tip: Visit the local home improvement store to get a price breakdown of materials and requirements.
The Cost Breakdown:
This is a hypothetical scenario: What was once listed as a $1000 rental unit, in a 50-unit complex, can now be priced at $1200 per unit with these simple, yet visible changes. The increased revenue adds up to $120,000 more each year.
Image is everything, even if it’s a building or advertising brochure. These concepts can be used for mobile home parks, storage facilities, plexes and other types of commercial real estate. A paint here and there, insulation to reduce energy use, and other improvements allow a leeway to increase the price of rentals.
When managing a commercial real estate property, it’s essential to:
- Be resourceful
- Explore all avenues of income
- Research competitors
All while still being reasonable and providing value to renters. Ensure that advertisements are real, and tenants get what is seen in pictures. Ultimately, when tenants experience value first-hand, they’re most likely to rent for the long-term. (Top image: Flickr | nannetteturner)
The Commercial Investing Center Team