Every industry faces unique challenges, and the rental market is no exception. At some point, every landlord is faced with the challenge of vacant properties. Vacancies may occur for various reasons, including changing market conditions, ineffective advertising, expensive rent, and more.
A vacant apartment can get neglected, which lowers the property's value and negatively impacts your investment, in addition to affecting your rental income. There are also several expenses involved in keeping the property in good condition.
We at Evolve have compiled the following guide on the risks of having a vacant rental property and how to mitigate them.
Vulnerable to Theft and Vandalism
Vacant properties are vulnerable to theft and damage. An intruder can enter quietly and take pricey amenities like furniture, air conditioners, and appliances. Additionally, there is a chance that someone will damage your property. Someone searching for cheap thrills might spray paint or do some graffiti on the walls.
Depending on the worth of the objects stolen or the damages caused, you might have to pay to repair and clean up the damage left behind.
These expenses may need to be covered out of your own money, which may cause a further delay in renting out the house because you must ensure it is secure and livable before renting it out to someone.
Flooding and Mold Growth
Water damage can result from leaks, frozen pipes, and broken pipes. Leaks that could flood an empty property are dangerous since they can be difficult to detect.
Problems with water damage might not be discovered until a new renter comes in. This can inconvenience the new tenants and cost you a lot to make the necessary repairs and maintenance.
Property owners need to be cautious when it comes to piping-related water damage. On occasion, moisture brought in by rain might enter a house and cause mold growth. This can make your rental property unsafe and risk the tenant's health.
Regular property inspections to check the quality of the pipes and the roofs can help prevent the growth of mold and stop water damage, and if necessary, steps can be undertaken to repair any damages that are found.
Since vacant properties have no one operating the property's systems, they are more likely to experience fires. Unmaintained heating systems can collect dirt and cause a motor system to overheat.
Additionally, combustible items can be close to the heater, which could cause a fire breakout. Squatters or intruders who break into the home could leave burning candles or other flammable materials behind, which could lead to severe property damage.
To avoid this, ensure you routinely inspect the property to ensure all systems are functioning as they should, and dangers are eliminated to reduce the chance of fires.
If your property is vacant, squatters can be drawn to it. Squatters occupy your space for no rent and make use of the furniture and appliances. They might even permit people to reside with them and collect rent if your apartment is big enough.
Evicting squatters from your property might be challenging. You might need to speak with a lawyer to guarantee a squatter's safe and legal eviction. This procedure can be expensive and time-consuming. In order to prevent this situation from ever arising, it is imperative to take preventative action.
Safeguarding your property from squatters is key. Ensure your security system is operational and cameras are positioned strategically to cover all property entrances. An alarm might also be useful for driving away potential squatters.
Lost Revenue and Expensive Insurance Premiums
The longer a property is vacant, the more money the owner loses. Additionally, if insurance companies decide to offer coverage at all, they raise costs due to the dangers associated with abandoned homes.
Investment property insurance policies may have provisions stating that if a property is abandoned or uninhabited for a predetermined amount of time, coverage may lapse. Property owners may need to invest in pricey additional policies to protect vacant homes.
The Best Way to Reduce Rental Vacancies
- Market your home as soon as possible. Use eye-catching rental advertisements that highlight the best features of your property. Use excellent images as well to create a favorable first impression.
- Maintain the appeal of your rental home. This will keep your rental home appealing to both potential and current tenants.
- Make repairs as soon as they are required or requested. If you ignore your renter’s maintenance requests, this could lead to a short-term renter, and you face the risk of having your home become uninhabitable.
- Set the appropriate rent. The high vacancy rates at your home can also be a result of charging the incorrect rent. Pay close attention not to overcharge or undercharge tenants while deciding on the rent amount.
- Offer incentives to tenants. You can entice tenants with benefits like free parking, internet access, or even a month's rent waiver. Even while it may cost you some money, the long-run financial benefits may be worth it.
- Employ a property management firm. In addition to helping you discover a suitable renter, an expert property management business may also assist you with property maintenance, rent collection, and contract enforcement.
No landlord wants to face the risks of vacant properties. Operating at a loss of cash flow not only puts your house at risk of harm. It can be difficult to fill vacancies, especially if you're a distant landlord. For your benefit, there are numerous actions you may take to reduce these risks and safeguard your investment property.
A property management company can help protect your vacant homes and ensure your rental business runs smoothly. We here at Evolve are fully aware of the risks of owning a vacant rental property.
Because of this, we spend our time finding suitable tenants for your rental property and implementing security measures before it is occupied. Contact us to learn more about our property management services.