Some single-family rental property owners find it beneficial to give their tenants certain amenities. A considerable number of Blacksburg property owners have started considering if they should include 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 doing this, in some cases, makes a rental home both more competitive and more attractive to tenants. On the other hand, there are some renters that do not need or want the amenities offered which risks you losing out on potential applicants. This is a clear example of why you need to understand what your target demographic wants— which amenities appeal to them. Knowing your local market is key to making smart choices for your rental homes.
There are markets where offering amenities is expected and there are others where it would give you a competitive edge. It may also allow you to charge a higher rent. If your area has a high census of 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. Adding cable and internet services as well as utilities may just be what would persuade them to rent. Especially if you’re renting a home to multiple tenants, providing such amenities can eliminate conflict between them and spare them the hassle. For instances such as this, you can raise the rental rate to cover the costs of each amenity, and these types of tenants would gladly pay a higher rate for them.
However, there are some markets or some demographics where providing amenities like cable, internet, and utilities does not make sense. Despite the increasing popularity of internet service and cable television, some renters just don’t want or need it. Requiring tenants to pay more for a service they don’t want would drive them away.
Many renters prefer making the decisions themselves. They want to have a say on whether they pay for these types of amenities, as well as the freedom to choose their own service providers. This may hold true with utilities as well. In places where there is more than one option for utility service, tenants may prefer one provider over another. This means that some of them would want to set up and manage their own services with the provider of their choice. Doing this also gives them more control over how much they pay for those utilities rather than paying a fixed sum included in their monthly rent.
For the property owner, there are advantages and disadvantages to either option. Setting up cable, internet, and utilities in your name give you more control over the services available or installed on your property. The property owner would have to deal with abandoned satellite dishes or other paraphernalia if they give their tenant the choice on the matter. But if the choice is up to you, then you can be sure that utility or other amenities are not creating an eyesore or damaging their valuable property. You could also benefit from a larger tax deduction on your income tax return when you pay all the utilities. This can 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. Also, signing up for internet and cable service typically involves some up-front costs, which a landlord may have trouble recouping through higher rent. Being the account holder, it is also an added responsibility to make sure the bill is paid each month, no matter whether your property is leased or not. These situations can significantly impact an owner’s cash flows, at least in the short term.
The final decision of whether to offer them cable, internet and utility services is yours to make. So do consider all the pros and cons. Remember that there are different situations and scenarios, which means there is no one solution that would work for all rental homes. But with the right information, you can be sure that the decision you’re making is the most beneficial one.
Don’t hesitate to consult the experts in the industry. Connect with a professional Blacksburg property manager today. At Real Property Management Insight, we make it our business to help you succeed in the real estate investment game without all the hassle. Contact us online or by phone at 540-998-6917.
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