Some single-family rental property owners find it beneficial to give their tenants certain amenities. There are a good number of Evanston property owners who are thinking about 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 doing so, in some cases, makes a rental home more competitive and also makes it more effective in attracting tenants. On the other hand, some renters may prefer not having the amenities offered, which risks you 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, it’s expected that your rental home offers amenities, but in others, it may be what gives you a competitive edge. 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. Adding cable and internet services as well as utilities may be just what they’re in the market for. Especially if your plan is to rent out the property to more than one individual, providing such amenities can eliminate conflict between them, allowing them to escape many of the more common hassles of home rental. For situations like that, you can easily raise the rental rate to cover the costs of each amenity, and tenants like these would gladly pay the higher rate.
However, in some markets, providing amenities like cable, internet, and utilities just won’t work. For some demographics, these amenities do not make sense. Even with the increasing popularity of internet service and cable television, some renters just don’t need or want it. For these tenants, asking them to pay more for a service they don’t want will probably drive them away.
Many renters like to be the one to choose for themselves whether they pay for these types of amenities, as well as have the freedom to choose their own service providers. It’s the same thing for utilities. In places with more than one option for utility service, the tenants may prefer 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.
Either option brings with it different pros and cons for property owners. Setting up cable, internet, and utilities in your name give you more control over the services available or installed on your property. If a property owner gives the choice to their tenant, they may have to contend with abandoned satellite dishes or other paraphernalia. But if you choose for yourself, 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.
However, irresponsible tenants may run up a utility bill, figuring they won’t be paying for the extra charges anyway. Together with that are the up-front costs that typically come with signing up for internet and cable service; these costs may prove to be difficult to recoup through higher rent. Since you’re the account holder, the responsibility falls on you to make sure the bill is paid each month, no matter whether your property is leased or not. In all these cases, there can be a significant impact on the owner’s cash flows, at least in the short term.
After going through the pros and cons of offering cable, internet, and utility services, you can then make a sound and well-informed decision. Remember that each situation is unique, which means there is no answer that would be true for all rental homes. But when you have good information, you can arrive at the choice that is best for you.
Ready to consult the experts in the industry? Connect with a professional Evanston property manager today. At Real Property Management Chicago Edge, we make it our business to help you succeed in the real estate investment game without all the hassle. Contact us online or give us a ring at 773-904-7700.
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