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3 Ways to Cash In by Adding Side Income - Al Williamson

3 Ways to Cash In by Adding Side Income

First Right By Al Williamson, LeadingLandlord.com

You won’t defile your rental by trying to earn other forms of income beside rent. Rental income isn’t sacred, and it certainly isn’t the only way to pay your expenses.

As someone who has tracked alternative income sources for landlords for over ten years, I can assure you that your business won't suffer. In fact, it will thrive once you get serious about tapping your property’s endowment.

You say you’d be happy to accept more income but don’t know where to start? Okay, I’ve got you covered.

Treasures Waiting to be Discovered

One of the many approaches to finding extra income, also known as side income or ancillary income, is for you to leverage the uniqueness of your rental’s housing density.

Your economy of scale is your competitive advantage.

To clarify, let’s look at the different types of residential rental property that you might own and the associated opportunities.

SFH Rental Owners Can Use Their Niche Advantage to Increase Cash Flow

One of the best things a small owner can do is to squeeze in markets where others can’t go.

Most landlords stick to the classic mode of wanting a 1-year lease for an unfurnished unit/house.

Single family landlords have the ability to create bouquet housing solutions that captures more of their client’s (tenant’s) budget.

For example, single family rental owners can re-invent themselves to become:

1 – A small youth hostel - If you’re located in a safe, desirable and accessible area, you may do quite well housing two to a room. These guests also present you with plenty of upsell opportunities.

2 – A private dormitory - I personally repositioned a house into a private dorm to take advantage of our proximity to the local medical school. On a net basis, this is 3 times more profitable than renting to a single family.

3 – Furnished short-term housing - By now nearly everyone has heard of Airbnb, a website that makes it easy to rent a furnished home to travelers for a short stay. Some people have strong opinions for or against this platform, but all agree that it’s wildly profitable.

Duplex, Threeplex, and Fourplex Owners Can Use their Small Group Advantage to Increase Cash Flow

Small communities can easily form strong sharing groups. A landlord, acting as a housing agent, can generate additional income while helping to reduce their client’s expenses.

Just like any business, you can earn more by deepening your client relationships.

For example, small apartment owners can add services to become:

1 - A rental store - Create an equipment room and charge extra for access to it. The closet’s contents might include: bicycles, high-end vacuums, washer and dryer, hand and/or power tools.

2 - An association manager - Distribute benefits associated with group plans such as cell phone, bulk staples and wireless services (TV and internet).

3 - A financial institution - Refinance car loans and other goods that have established secondary markets. This option will help you earn more interest on your money.

Commercial - Sized Apartments Can Use Their Complimentary Business Advantage to Increase Cash Flow

Larger communities, especially those that have onsite management, have plenty of opportunities. Some of the less obvious ideas include:

1 - U-Haul Dealership - It costs nothing to facilitate the rental of trucks and trailers from your location. If you see them coming and going all the time, then this ancillary business is for you.

2 - Onsite (pay-per-use) car wash - Car washes can be a money maker all year round. If you open up to attract non-residents in the area, then all the better.

3 - Doorstep Garbage pickup - This amenity can serve a maintenance inspection role as well. If you don’t have an offset vendor to handle this, then consider creating your own service.

Final Thoughts

There are many ways to systematically find untapped side income opportunity for your rentals. Look for checklist-like systems to help you see what’s in front of your nose.

As small property owners and large asset managers, we need to widen our views to enlarge our wallets. We all have the potential to double our net incomes by growing our side income.


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