Everyone knows that turnover is what kills a rental property investment. As a landlord, you want to have features that, first and foremost, create a long-term tenant. That’s the number one goal: to have a place with assets that appeal to people who are going to stay a long time.
A lot of landlords are thinking about what I call the HGTV stuff: paint, accent walls, a new kitchen with stainless steel appliances – all of the things that tend to be appealing to the eye. Those are important, however, it’s not about the frills. It’s about creating a functional place that feels like a home…not a rental.
So what makes people happy with where they reside?
I would say the two most important amenities are 1.) sufficient storage and 2.) adequate parking. I hate to be a buzzkill, but the truth is if you want long-term tenants you need those two things. Let’s expand.
Storage = Satisfaction
Essentially people want places to store their belongings, whether it’s under the stairs, in a larger closet, or an outdoor shed- if they have enough storage, people will never want to leave.
Even if you have to raise the rent by 2%, tenants will go out to the garage and think, “I have all this stuff here and I have to move that over a $10 or $15 increase? No way, I’m staying here another year.”
Ideas for Adding Storage
If your rental property doesn’t already have it, look for opportunities to create adequate storage for potential tenants. Anything you can do to create the psychology that makes tenants feel as if they’re living like a homeowner will benefit you in the long run.
First, identify any space that can be used and create a storage space there. For example, you can create a closet space under the stairs or under covered parking awnings pretty easily.
If you don’t have storage space, it’s worth investing some money into. If you can spend $10,000 to add a garage, add it. If building a full garage isn’t in your budget, buy a pre-fab storage shed at your local hardware store and put it in the backyard.
Everyone wants an easy spot to park, but this is especially important in places with distinct seasons.
I’ve found that nothing is more depressing for a tenant than to have to park on the street three miles away, with groceries in hand, and walk to their apartment. It’s even worse in winter when a snow plow comes through and you have people who are boxed in. They can’t get to work at 8 a.m. in the morning and are looking at the house they’re renting saying, “I’m out of here.”
Coming back to the original psychology; we want tenants to act like homeowners. Homeowners typically at least have a driveway to park in. It sounds crazy, but If you don’t have a place for off-street parking, you’re instantly eliminating 80% of your tenants.
Ideas for Adding Parking
Off street parking is great, but if you have the ability to create an awning or covered parking, all the better. In the winter no one wants to scrape ice off their windshield, as they’re scraping all they’re thinking about is how much they hate this place.
Ideally, your property will have a one or two car garage space for the people living there. If that’s not an option, however, for around $2,500 you can create an alternative covered parking situation that alleviates tenant frustration.
The key is to identify pain points and then get rid of them. The pain is in parking and the pain is in not being able to store things. If you want to instantly upgrade your rental property, my advice is to start there and THEN add additional features that have aesthetic appeal.