Running a rental property business can be tricky at times. If you’re not paying attention to your expenses, you’ll realize that you’re spending more than the amount you expect. From property maintenance to mortgage, a lot of things can consume your money. As a landlord, you know how important it is to profit a bit more at the end of the day.

There are various strategies for you to minimize your costs while maintaining the good condition of your rental property. While you can’t completely avoid bumps in the road (because they normally happen), making little smart decisions allows your savings to accumulate so that your business booms.

Here are some money-saving tips worth checking out.

1. Buy a profitable property.

If this is your first time to invest in a rental property, it’s easy to feel confused with the choices that are right in front of you. Remember that no two properties are alike. There are things to look for when considering a profitable property:

• No extra maintenance required – Steer clear of a property that’s in a bad shape. It may be sold at a very affordable price but bring with it many maintenance costs – roofing issues, wiring, plumbing, pest infestation, etc.
• Amenities nearby – Is the property located near amenities such as gyms, food courts, and malls? These things attract potential renters since they can access anything for their daily needs.
• Neighborhood – If you plan to purchase a property near a university, expect to have more frequent vacancies especially during the summer.

2. Perform regular maintenance.

Over time, your rental property deteriorates due to several factors. You can protect yourself from huge repair projects by having a maintenance plan in place. As soon as tenants complain about leaks, odd smells, and pests, have a contractor look into the problem and solve it the earliest time possible. This way, small problems are mitigated.

3. Hire a good property manager.

A landlord may opt to hire a property manager if he is unable to manage the rental property himself because he lives out of town. While a property manager requires a financial investment, in the long run, you’ll be able to save time and money. That’s if the property manager you hire is a good one.

To hire a property manager that has your best interests in mind, make sure to get referrals and check online reviews. You’ll also want a property manager who’s licensed and certified and has experience running several rental units.

4. Do an inventory check in and check out.

Before a tenant moves in, make sure that you record the state of your property. Do the same before the same tenant moves out. Document the details of your rental such as the walls, coverings, furniture, and any equipment that is supplied in the unit. Some tenants unknowingly cause damage to a property over time and may not be aware of it.

At Landlord Prep, I advise that you secure a checklist that outlines all the details of the unit. A digital camera also helps with the documentation. Have yourself and the tenant sign the checklist after you conduct the visual inspection together. You wouldn’t want to pay for damages that you had nothing to do with.

Suggested reading: Doing a Walk-Through Inspection Before a Tenant Moves In

5. Switch to LED lights.

One way to reduce energy consumption is to upgrade your lighting to LED. LED light bulbs use up less energy than their incandescent counterparts. Not only that, LED bulbs are also environmentally friendly, safe, affordable, and long-lasting. Versatile as they are, these bulbs come in various colors and levels of brightness depending on what you need.

6. Screen tenants properly.

Most often than not, how you handle your rental property business impacts your savings. It’s very easy to waste money simply by bringing in the wrong tenant. Bad tenants are tenants who break your rules, don’t pay rent, and damage your rental.

Last week, I wrote a post on success tips for the tenant screening process. In the post, I mentioned that you should pay attention to a tenant’s past experience with his landlords, credit background, and stability in terms of his job.

Suggested reading: Top Tips for a Successful Tenant Screening Process

Final Thoughts

These are only a few of the many ways you can save money as a landlord. It’s great to be able to make money from your passion, landlording, but it benefits you more to reduce your expenses. If you’re careful enough, you can gain higher returns and a higher success rate in your business.

Need more landlording advice and tips? Join the Landlord Prep: Video E-Course and How-To Tutorials get the complete DIY landlording course. This will help you stay confident and knowledgeable as a landlord!