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Bakersfield California Real Estate
Bakersfield, California, is located in Kern County, 100 miles NW of Los Angeles, California. Bakersfield has a population of 247,057. It has become a popular place for visitors en route to and from Las Vegas and Los Angeles, who stop for outdoor...

Private equity funds boost real estate market
Private equity funds boost real estate market From Business-Standard.com The real estate market in India is driven by Asian real estate funds, Singapore developers and domestic private equity funds dedicated to real estate, according to Mridul...

Real Estate Agents And The A B Cs
Alphabet Letters after a person's name seem to bestow some kind of special prestige. PHD, MD, ESQ are common... but just look at what is available to real estate sales people... ABR, ABRM, ALC, CCIM, CIPS, CPM, ARM, AMO, CRB, CRS, CRE, GAA,...

Real Estate Terms - From Appraisals to Comps
When you're selling your home or other real property on your own, you don't have to know everything about the process. It does help to have a practical knowledge of the terms that come up during the process. Keep in mind, these aren't intended as...

Working With Your Real Estate Attorney
Purchasing or selling a home will probably be one of your largest and most important financial transactions. Before signing a contract to purchase or sell a home, both buyer and seller should consult an attorney to assure that the real estate...

 
Real Estate Rentals - Selling For More

Selling real estate rentals isn't like selling houses. You can paint a house, and get a little more because it looks nice. Rental properties, especially larger ones, are different, because they're bought by investors, who look at income more than new paint. Raise the income, and you increase value to investors.
Time to learn about capitalization rates. If investors in your area expect a capitalization rate of .08 it means they want a net return (before loan payments and taxes) of 8% on the purchase price. So if your three-plex generates $12,000 net income annually, they'll value it around $150,000 ($12,000 divided by .08). If you can make it generate $16,000, you make it worth $200,000.
More Income From Real Estate Rentals
Raising rents is the obvious way to boost income, if you can justify it. See what similar units are renting for. If your units are $60 below the going rate, you can raise the rents and not lose your renters. Increasing the rent $60 for three apartments means $2160 more net income annually. With a .08 cap rate, you just added $27,000 to the value of your property.
There are other ways to raise rents. Maybe your tenants will agree to $30 more per month if you have a carport built. That's $1080 more net income annually, meaning roughly $13,500 more value added to your property. ($30 x 3 units x 12 months = $1080 divided by a .08 cap rate = $13,500) If you can build that carport for $4,000, that's a good return on investment right? What else do they want?
Higher rent isn't the only way to get more income. Storage sheds can be rented to tenants or you could put in a coin-operated washer and dryer. With a larger income property, you could install pop machines.
Reduce Expenses Of Real Estate Rentals
Could you add insulation to reduce the heating costs? If you're paying $80/month for lawn care, will one of the tenants do it for $40? Could you buy cheaper insurance? Any way you can reduce expenses raises net income (unless it scares away tenants). A new $4,000 furnace that saves $800/year on heating costs means you just turned $4,000 into a $10,000 higher sales price.
This isn't an exact science, and of course appearance and other factors matter. Increasing that net, though, is the surest way to get more for your rental properties. Make the changes at least several months before you try to sell the property (a year before, if possible). Also, learn how do the math - it really does matter with real estate rentals.

About the Author
Steve Gillman has invested in real estate for years. To learn more, go get your real estate investing course free at: http://www.MakeThatOffer.com

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