Vacant Rental Property Costs Money, and from the stand point of real estate owner or landlord it does not feel good, when it is empty. In order to increase your rental income as a property owner or landlord, you are aware that you need to fill rental vacancies as soon as feasible. Is it the only way that empty rentals are losing you money, though? Unfortunately, unoccupied units threaten more than simply a reliable source of income. We will explain how much these vacancies are truly costing you.

 

But, why is Rental Property Vacant?

It’s crucial to be aware of the many potential causes why your home can become unoccupied before delving into the expenditures related to rental property vacancies. You can also know the tips to buy rental property.

The term “empty” is defined by the courts as a home without adequate furniture for someone to reasonably live there, according to a number of authorities. Unfortunately, the terms “unoccupied,” “empty,” and even “abandoned” are sometimes used interchangeably since there is so much controversy in the real estate and insurance industries. For the sake of clarity, the term “empty” in this piece will refer to a property that is vacant and between renters.

 

There are a variety of circumstances in which you can discover Vacant Rental Property Costs Money:

 

• You are now interviewing potential new tenants because your tenant’s lease has expired and they have decided not to renew it.
• Before the term was up, your tenant left the property.
• Due to a major contract violation, you are required to evict your tenant.
• The desire to collect the greatest rent rather than agreeing to a lease with a qualified tenant at a slightly lower rate is another fairly frequent circumstance encountered by landlords.

1. Real estate taxes- Reason behind Why Vacant Rental Property Costs Money

Property taxes are one of the most evident expenses associated with rental property ownership. You still owe property taxes whether or not the mortgage on the property has been paid in full. Additionally, whether the property is unoccupied or occupied by a renter, you are still required to pay those taxes, and in this way, vacant rental property costs money.

 

Renters who are dependable and timely with their payments contribute to reducing the cost of property taxes, which all property owners must pay. Property taxes can be a major expense, depending on where your rental is located. And regrettably, one method a landlord will have to pay for a vacant unit is through property taxes and that is why vacant rental property costs money.

2. Utilities- Reason behind Why Vacant Rental Property Costs Money

When a rental property is vacant, many landlords forget to factor in the cost of utilities. Certain things, like hot water and power, are optional during a vacancy, especially if you expect it to last a long time. However, it is a good idea to keep such things going if you are just in between tenants and are actively looking for another tenant. Instead of continuously turning the utilities on and off, this will make the transfer of utilities to your new renter much easier and in such a way, vacant rental property costs money.

 

Remember to winterize your home correctly to prevent future damage like broken pipes if your property is vacant for a lengthy period of time and you have shut off the utilities to avoid this hidden cost, especially for the chilly winter months that Maryland is known for.

3. Protection from Burglars and Squatters- Reason behind Why Vacant Rental Property Costs Money

 

In Henderson and the neighboring areas, squatters, thieves, and vandals unfortunately occur more frequently than you may imagine in vacant buildings. If property owners are careless, an empty building is considerably more likely to incur vandalism or become the target of squatting. 

 

By making a sound security system investment, you may shield your property from some of these problems. There are many systems that are simple to install and use cameras and motion detectors to inform you via your smartphone when a possible intruder enters the premises. However, it does mean that you won’t have rental money to help pay for these security mechanisms to keep your house safe. In this way, vacant rental property costs money.

4. Insurance

 

Property owners should get insurance, especially if they have vacant rentals that are more vulnerable to theft and vandalism. But landlord insurance is also a wise investment because it guards you against harm done to your rental house while renters are living there.

A basic landlord insurance plan with property and liability protection includes coverage for items like damages to your rental house, apartment, or condo caused by:

• Fire
• Wind
• Rain/Hail
• Flooding
• Vandalism
• Burglary

On some landlord insurance policies, you can also acquire coverage for detached structures like garages and gates. In such a way, vacant rental property costs money. But this is a total security for the future.

 

Keep in mind that many of these insurance policies are in force whether or not a renter is residing in your rental property. When the rental is vacant, they might be advantageous in many ways, but the costs can add up rapidly. It might be challenging to pay for these insurance expenses when there is no rent revenue and that is why vacant rental property costs money.

5. Protection from Burglars and Squatters

 

In vacant property in Las Vegas and the neighboring areas, squatters, thieves, and vandals unfortunately occur more frequently than you may imagine in vacant buildings. If property owners are careless, an empty building is considerably more likely to incur vandalism or become the target of squatting.

By making a sound security system investment, you may shield your property from some of these problems. There are many systems that are simple to install and use cameras and motion detectors to inform you via your smartphone when a possible intruder enters the premises. However, it does mean that you won’t have rental money to help pay for these security mechanisms to keep your house safe and thus vacant rental property costs money.

6. Fees for Homeowner Associations

 

Homeowner association fees (HOAs) can be beneficial in many ways, but they frequently demand that members pay monthly dues in order to maintain the homes and neighborhood amenities. You must continue to pay your HOA dues even while your rental property or unit is unoccupied, which can be a significant burden if you don’t have rental income to cover it. And thus, vacant rental property costs money.

 

Depending on the community, HOA dues in Las Vegas can range from as little as $15 per month to as much as $600 per month!

 

Conclusion:

 

Ultimately, not always having a renter in your rental home can result in significant financial burden. In order to avoid ruining your bottom line or, worse yet, losing your property, you should absolutely think about saving up some emergency cash to help you deal with the financial shock of the unforeseen costs associated with property vacancies.

 

Hiring a property management service like Bay Management Group is a terrific method to ease the burden of hidden bills. You won’t frequently have to worry about long-term vacancies if you have experience finding highly suitable tenants for your rental properties. To ensure a prompt recovery of losses, aggressive marketing strategies for swift placement, a rigorous screening procedure, and assistance with the eviction process are all used.