A.D. CANTELMO REALTY/TONY CANTELMO
BROKER
TONY CANTELMO

 




A.D. Cantelmo Property Management Our Business is Property Management in Orange County California






What is the best way to make money on your Rental Property?





All investment property owners want to get more revenue from their rental property. The question is, at what cost. As a Property Management Company in Orange County Ca. I am always weighing the desire of the Property Owner to get more rent revenue, and the cost of a vacant property to the Owner. I always encourage Property Owners to think long and hard about raising the rents, while you have a good Tenant in the property. The question is, will it be more profitable for the  property owner to wait  for the property to be vacant before you raise rents?  There are caveats to that question and every situation is different. First, lets look at the reason Raising the rent with a good Tenant in place may be more costly to the property owner then the higher rent brings in.

The Cost of Vacancy

For a investment property owner the best way to get the most from your investment, is to have long term Tenants.  I find The higher the turnover, the higher the cost to the owner.

For example:

You have a property that rents for $2000.00 per month. Your lease is up and you decide that your property is worth $2100.00 per month. The extra $100.00 per month adds up to an extra $1200.00 per year. Great! If the Tenant that occupies the property agree's and remains in the property at the increased rent, no problem. The issue starts when the Tenant does not want to pay the extra $100.00 per month and decides to move. Now the extra income you were counting on may not be so Great.

Cost of getting a new Tenant

Once the Tenant moves, you will have costs to get the property ready for a new Tenant. Even if the Tenant leaves the property in good shape, there will be cost to prepare the property for rent. Lets give it a conservative number of $250.00. Now you have to get a new Tenant. The normal commission you will pay to fill the vacancy will be 1/2 months rent. In this case 1/2 of $2100.00 is $1050.00. It takes on average 30 days to get a new Tenant moved in, so you have lost 1 month in rent revenue. That cost is $2000.00. The total cost of this vacancy is $3300.00. The total increase in rent for the year is $1200.00. It will take you more than 2 years  to recoup the cost of the vacancy. That assumes you get a good tenant that stays for that time period. 
Now you may say that you can fill the vacancy for less then the $3300.00 cost. Lets cut it in half, that's still $1650.00. It will still take you more then 1 year to make up for the loss in revenue.

Keeping your tenant:

If you look at those numbers, and believe me those costs are real, it would seem to be much better to keep the long term Tenant at the rent they are comfortable with.
You will make more money in the long run, and also save the hassle of getting a new Tenant.

If the Tenant has been in the property for a long period of time, and a rent increase is necessary, it would be better to sit down and discuss the increase with the Tenant and make sure they are wiling to stay with the new increase. Maybe to make it easier on the Tenant making small incremental increases over time will make it more palatable.

The key, is try to keep your Tenants for the long term and avoid unnecessary cost. In the end, you will make more money on your investment, and you will be much more relaxed as an investment property owner.





A.D. Cantelmo Property Management Specializes in Property Management on Orange County Ca.

Tenant/ Property Service
 
Marketing Property
We market your property on all the major Real Estate websites, including Zillow, Trulia, Realtor.com, and the Multiple Listing Service

Showing your Property
We make sure your Property is shown to all Qualified, interested parties. We never allow Unchaperoned shwings

Screening Tenants
We have a detailed tenant screening process. We run Credit, Criminal and Eviction checks. we check rental history, and use our more then 10 years of Property Management experience to place the Best Tenant possible in your Property

Open 7 Days a week

Contact Tony
714-313-7413
If you have hours that do not coincide with normal business hours, No Problem.


 

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What my clients are saying  

5 reviews 5.0 star rating 1/21/2016 I was tired of using a large management team to manage my investment property. I felt I was always on the back burner. I was recommended to Tony from a business associate, he assured me I would be very pleased. Well that was an understatement, Tony is amazing. He's above all honest and always available for my concerns. I'm not as well versed as other investors with property management and maintenance and tenant relations, Tony has been an excellent partner and has guided me through quite a bit of needed repairs and worked far beyond what was expected to help turn my little investment into quite a prosperous investment, If what your looking for is prompt return calls, honest direction and someone very knowledgeable with general contractors and real estate laws, Tony is your man. Angela

 

~ Angela

5 reviews 5.0 star rating 1/21/2016 I was tired of using a large management team to manage my investment property. I felt I was always on the back burner. I was recommended to Tony from a business associate, he assured me I would be very pleased. Well that was an understatement, Tony is amazing. He's above all honest and always available for my concerns. I'm not as well versed as other investors with property management and maintenance and tenant relations, Tony has been an excellent partner and has guided me through quite a bit of needed repairs and worked far beyond what was expected to help turn my little investment into quite a prosperous investment, If what your looking for is prompt return calls, honest direction and someone very knowledgeable with general contractors and real estate laws, Tony is your man. Angela

 

~ Angela

"10 out of 10 I am so Happy Since I left my old company and I joined AD Cantelmo Property Co I am stress free I live in a different state and this company watches my house and always Mr Tony Cantelmo is on top of things I really want to thank you for what you do for me and I would really Recomend this Company to any and every one Thank You again. Shawn" ------------------- "I need to trust the people I work with and I trust Tony. He stays on tops of things, communicates well, and gets things done. He not only gets things done but he gets things done the right way. Jim"

 

~ Shawn

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