When you rent out your properties, your main reason for doing this is to earn money. That is a basic fact. Sometimes this is not enough or you don’t have enough tenants for you to earn a lot. This is where you consider other ideas for you to gain more income. One of the first things you might consider is charging your tenants with a higher rent. But will it do you good?

It may be the most obvious plan to do but you have to consider a lot of factors first before doing so.

Losing tenants

An increase in rent may drive away some of your tenants and that would only increase your financial troubles. Ask yourself if you would risk losing a tenant who never gives you any trouble and pays rent on time. Keep in mind that not all of them could afford additional expenses especially if they only have enough to get through the day to day expenditures or during times of great financial crisis.

Late payments or deficiency in payments

If you push through with your rent increase, expect that some of the tenants might not be able to pay on time or they might not pay in full. You have to understand that they may already have a fixed budget for their monthly expenses and additional rent may cause a big dent on that.

Expect complaints

Anticipate that this will not be a welcomed change to your tenants. People are generally particular and sensitive when it comes to money especially if they have to shell out a lot of it. Make sure that you justify the increase before you do it and check your state laws regarding rent increase to avoid any legal consequences.

Difficulty attracting potential tenants

When you post your property listings at Padleads.com, one of the first things your applicants will look at are your rental rates. If they think that your rental fees cost more than what other rental housing in nearby areas are charging, you will most likely discourage tenants from renting from you. It is normal for them to look for a unit that fits their budget.

Always check the rental rates in your neighborhood. It’s only reasonable for you to increase your rental fees without overcharging your tenants. And make sure to give your current tenants a heads up if you decide to do so.

If you can’t increase your rent, what should you do?

You might be asking this question by now. There are still other things that can be done to increase your income from your property rentals. Here are some of the things:

1. Include fees for pets

If you are one of those landlords who allow pets in their properties, then you can charge extra for this. The tenants would not mind paying an additional amount if they want to keep their pets with them. The pet rent may be used to fix pet-inflicted damages to your property, especially for untrained animals.

Related article: Pet Policy: What Landlords Can Charge

2. Fine late payments

Not only can you generate income with this but this will motivate your tenants to pay their rents on time or even earlier. A tenant who tends to slack off when it comes to paying rent is not unusual. Since it is their obligation, it is reasonable to charge them with late fees as a penalty for their violation.

3. Rent out your properties for people on vacation

If the property is not yet occupied and you do not have any potential long-term tenants yet, you can let travelers rent the place for a few days. This is getting more common now and people might prefer staying somewhere more homey than a hotel that might cost the same or even more. This will decrease the amount of time that a vacant unit is not bringing in income

4. Parking or storage fees

This is becoming a regular thing in rental housing nowadays. People would pay a spot to park their cars without having to worry about it getting towed. Surely they would not mind the additional payment in exchange for their peace of mind.

Storage units are also becoming more common. If a tenant has too many stuff that won’t fit in their house or apartment, offer a storage space for them to rent out to avoid clutter inside their homes and at the same time making sure that it is somewhere safe. It can be a shed or an extra room that they can access.

Don’t immediately decide on increasing your rental rates. It has to be a calculated business move. They’re not always a good idea for your business and your tenants will most likely complain about it. Consider other means of increasing income first instead of immediately deciding on rent increase. It might be the first thing you can think of but it doesn’t mean it’s the best idea there is.