If you have managed property before, then you have probably experienced a vacancy at some point. Tenants come and go all the time for different reasons. The important thing is to avoid long periods of vacancy.
Rental vacancies are bad for your bottom line. Having to undergo the re-renting process all over again can mean fewer profits for you. Besides the zero cash flow, a vacant unit also carries certain risks.
The following are some reasons why you should always strive to keep your units occupied by a qualified tenant.
A Squatter Can Occupy the Home
Squatters usually occupy homes that are abandoned, vacant, or foreclosed upon and start living in them as if they were their own. Because they signed no lease, they are under no obligation to pay rent to the actual owner.
What’s more, the process of removing squatters from your property can be quite time-consuming and potentially costly. You’ll need to undergo the same eviction process you would if you were evicting a difficult tenant.
There is a Heightened Risk of Fire Damage
A vacant rental property is also susceptible to fires. When heating systems are no longer properly maintained, dirt and dust may accumulate and may make the motor systems overheat.
Besides heating systems, a fire outbreak could also be caused by a passer-by. A person could, for instance, inadvertently start a fire while smoking near your rental property. Others may also start a fire on purpose.
Your Home Could be Vandalized
A vacant home is also at risk of getting vandalized. This is especially common in homes that are furnished. A thief can sneak into your
North Carolina rental and vandalize things like furnishings and appliances.
A vandal may also enter your home and draw graffiti on the walls and/or spray paint your walls.
There is Increased Theft
One of the major risks facing vacant properties theft. A thief knows that since there is no one occupying the home, their chances of getting caught are quite slim.
Some of the valuable items a thief may be interested in include antique pieces, copper wires, and aluminum pipes.
A Vacant Property Means Zero Cash Flow
Most people buy investment properties to make a passive income. The only way to earn that income is by having a tenant. But regardless of how great your home looks, a vacancy will be inevitable at some point in your career as a landlord.
There are several ways in which rental vacancies come about. It could be during a season where demand for rentals goes down. The condition of a rental property could be another reason. In other words, your property may not be as competitive as others in the area, effectively driving away prospects.
It’s also possible that your marketing process may not be as effective. You’ll need to use a myriad of marketing tactics to reach a wide prospective tenant pool.
There is a risk of water and mold damage
One of the top causes of water damage are leaks from broken pipes. If you leave it unaddressed, it has the potential to turn into a very costly repair job.
What’s more, water damage isn’t always easy to detect especially if no one is living in the residence while it’s occurring. Thus, the damage could be very extensive by the time you notice it.
Water damage can also bring about another problem,
mold growth. Mold can eat away at materials like wallpaper, drywall, carpet, flooring, ceiling tiles, and other structures in the home.
Left unaddressed, mold can even lead to severe property damage and potential health risks should someone take up residents before the issues have been fixed.
The insurance cost may increase
A home that is not occupied carries more liability than one that has a tenant. As already mentioned, an unoccupied home is more susceptible to fires, break-ins, and vandalism.
These reasons make insuring vacant rental homes a tad bit expensive. Resultantly, you may need to take out additional coverage to insure your home against such issues.
How to Minimize Risks of Having a Vacant Rental Unit
There are certain things you may be able to do to keep your property safe.
The following are some of the things you should do when your property is vacant:
- Increase the property’s security. Secure all entrances and block all main entryways. You may also want to install security cameras around
your North Carolina property.
- Clean the property. Signs of an unoccupied house are dirt, filled trash bins, and overgrown grass. This can alert people to the property's vacancies putting it at great risk.
- Let the neighbors know that the home is vacant and ask them to be vigilant of any suspicious activity.
- Remove all valuables you may have in the home. This way even if someone tried to break in you can minimize losses.
- Inspect the home once every while. If it’s taking a while to find a replacement tenant, consider visiting the home often. Have a checklist and make the date of the inspections as random as possible. By making the visits random you make it harder for thieves to predict when you’ll show up.
- Disconnect all utilities such as gas, water, and electricity.
- Hire a property manager to help you look after the home. A good property manager will have the experience to assist you in look after the property and find a good replacement tenant. They can also help you collect rent and maintain the unit.
Summary
Vacancies are bad for any rental investment. Besides zero income, they are also susceptible to a myriad of problems. Luckily, hiring a good property management company may be able to alleviate those problems for you.
Dawson Property Management can help market the property, screen prospective tenants, collect rent, and more! Get in touch with us today to learn more!
