Many single-family rental property owners understand that they can benefit from offering certain amenities to their tenants. Many Churchill property owners have begun to consider including amenities such as internet and cable television service as well as utilities like water, sewer, and even electricity in the cost of the rent. And certainly, in many cases, this does make rental homes more competitive and also makes it easier to attract tenants. The flip-side to this is that not all renters want the amenities you’re offering, which puts you at risk of losing out on potential applicants. It is evidently very important that you understand your target demographic— what they want and which amenities make sense for them. When you know the local market, you’ll be able to better choose which options are suitable for your rental homes.
In some markets, when you offer amenities, you’re giving your rental home a competitive edge; in others, it’s expected. It may also allow you to charge a higher rent. In a neighborhood with many young professionals or retirees who rent, there may be strong demand for “all-inclusive rentals,” or properties that offer not just a house, but additional services as well. They may be searching for a rental home that includes cable and internet services as well as utilities. Especially if you plan to have more than one tenant for a property, providing such amenities can eliminate conflict and spare them from many of the more common hassles of renting a home. In cases like this, you can raise the rental rate to cover the costs of each amenity, and tenants like these would be willing to pay a higher rate.
However, for some demographics, providing amenities like cable, internet, and utilities doesn’t make sense. Some markets just don’t have the demand for these. Even though the popularity of internet service is increasing and cable television is ubiquitous, not all renters are looking for it. Asking tenants to pay more for a service they don’t want just might drive them away.
Many renters want to decide for themselves. They want to be the ones to decide whether they pay for these types of amenities, as well as have the freedom to choose their own service providers. The same applies to utilities as well. Tenants may prefer to set up and manage their own services with the provider of their choice. This is especially true in areas with more than one option for utility service. Doing this also gives them the power to choose how much they pay for those utilities, rather than paying a fixed sum included in their monthly rent.
Both options have their respective advantages and disadvantages for property owners themselves. Setting up cable, internet, and utilities in your name give you more control over the services available or installed on your property. If the tenant would select their providers, the property owner may have to deal with abandoned satellite dishes or other paraphernalia. But if you get to choose, you can be sure that utility or other amenities are not creating an eyesore or damaging their valuable property. You also get to enjoy a larger tax deduction on your income tax return if you choose to pay all the utilities. This would then help reduce your tax liability.
On the other hand, irresponsible tenants may run up a utility bill, figuring they won’t be paying for the extra charges anyway. On top of that, signing up for internet and cable service typically involves some up-front costs, which may not be so easy to recoup through higher rent. As the account holder, it’s on you to make sure the bill is paid each month, and it doesn’t matter if your property is leased or not, you’ll still have to do this. All of these situations can significantly impact an owner’s cash flows, at least in the short term.
Do consider all the pros and cons of offering cable, internet, and utility services. The final decision is, ultimately, in your hands. Remember that each situation is different, which means there is no “standard” solution. But with the right information, you can make the choice that is best for you.
Ready to consult the experts in the industry? Meet with a professional Churchill property manager today. At Real Property Management Bozeman, we make it our business to help you succeed in the real estate investment game without all the hassle. Don’t hesitate to contact us online or give us a ring at 406-586-2226.
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