Most of us who are small real estate investors buying and
renting single family homes are accustomed to making every
dollar count. It's that habit that causes us to make a silly
decision when we advertise a house for rent.
Just take a look at the Home For Rent classified section of your
newspaper. You will see rows of two or three line ads that all
seem to blend together in an uninspired glob. Yes, I know
newspaper ads are expensive, but have you ever stopped to think
how much a bland three line ad is really costing you? Let's do
some logical thinking about this penny pinching.
In our example will use a rental house where you have a monthly
mortgage payment of $850. That includes principal, interest,
taxes and insurance. You are offering the home for rent at $900
per month. If you divide your monthly mortgage payment by 30 you
will realize that it is costing you $28.33 cents to own the
home. That's $198.33 per week. So every week that the house is
vacant you are losing $198.33. Cutting two weeks from that
vacancy will save your $396.66.
If you are penny pinching with a little three line ad that fails
to find a renter for weeks you are watching $198.33 fly out of
your grasp every week. That's when you should realize that it
just makes good business sense to buy a nice big classified ad,
which will give you the best chance of catching the eye of a
renter the first time it runs.
Filling vacancies fast is the mark of a good investor. As soon
as your current tenant gives you the required 30 day notice that
he or she will vacate the property you must swing into action.
Your goal should be to have a new tenant ready to move in the
day the old one moves out. Do this...
1. Ask your current tenant if they know of any one who is
looking for a rental. Ask them to spread the word among their
friends and co-workers. If you have a good relationship with the
tenant they should be willing to help you find a renter. Offer
them a one or two hundred dollar reward if they find a new
tenant for you before they move out.
2. Immediately put a For Rent sign on the property with flyers
describing the property and the cost to rent. We have a page on
our Web site for each property we own with inside and outside
photos. Included on the page on room dimensions, and the
location of nearby features like schools, hospitals, shopping,
public transportation, etc. We include the Web site address on
the For Rent sign and on the flyers.
3. We send a postcard announcing there will a rental available
to the neighbors. They may have friends whom they would like to
have live nearby. We offer a cash reward of one or two hundred
dollars if we rent to someone they referrer to us before the
current tenant leaves.
4. We pass out flyers to nearby businesses like barber shops,
nail salons, dry cleaners, etc. We make the same cash reward
offer to them as we do to the neighbors.
Penny pinchers don't do things like that and they pay dearly for
their mistake.
About the author:
Mark Walters shares his experience as a real estate investor
with free videos at
http://www.CashFlowInstitute.com
