Are you pursuing ways to increase your rental income? This is an especially smart move if you’re priced out of your local market but still want to grow.
Have you implemented any of my suggested strategies to grow your ancillary income? I have a comprehensive list of great ideas to inspire you – check it out.
Scrutinize Expenses to Find Opportunities
Once you try something and have success, you’ll be able to accelerate your income growth by keeping and analyzing good records.
Let’s take my doctor dormitory for example. This is business that I operate out of my 2 bedroom 1 bathroom apartment where I house rotating medical students that have limited budgets but need a place to stay, usually for 28 days.
As I was analyzing my income and expenses for this venture, I realized housekeeping during turnover is my largest expenses. My cleaning lady charges me between $95 and $115 for a complete cleaning and laundry. It’s a good deal but no expense is sacred.
I could defray this expense by tacking on a cleaning fee. Cleaning fees are customary in the short stay, Airbnb world. In my area, $25 cleaning fees are typical. So that’s what I’ve done.
Benefits of Tracking Expenses
To get the most from your efforts to increase rental income you must keep good records. Counting your money is more fun than tracking expenses, but you have to do both. The work pays off by:
1 – Bringing expenses to your attention and into focus. How’s your record keeping practices?
2 – Spurring you to consider opportunities to defray or eliminate the money drain.
Can Your Reporting Practices Use a Tune Up?
Oh this topic hits home with me! I hate handling receipts and I’m such an imposter writing about the topic. We are switching over from simple spreadsheets to Quicken for Rental Properties.
Last year I got set up with Shoeboxed.com which is a web based company that scans and organizes your receipts. I just mail them a large envelope of my actual receipts and a real person scans them and categorizes them. This service starts at $9.99 per month. At tax time, you’ll love me for this tip!
Share a story of how you found a good idea by studying your expenses. Please leave a comment below.