Of course you know your revenue sources- rents and other income, or ancillary income. But what's the next level of analysis? Is each source being maximized? Does your stated lease rent match collections on the rent roll? How many ancillary income sources do you presently utilize? What can you add?
On an asset-by-asset basis do you know year-over-year and quarter-over-quarter rent growth and revenue growth? Naturally we focus on rents as that's the lion's share of revenue. But let's consider the potential for all other sources.
What sources can you "add" to those already in place? We can always make room for an extra line on our report to account for additional sources of revenue right? Once you have a few in mind for implementation consider performing a resident survey to validate your thinking.
Some added services require little or no capital investment. Start with these. Think in terms of risk reward; calculate pay back and legal exposure (if any) into your decision-making.
Ancillary income can contribute significantly to cash flow as the majority of our sunk costs remain unchanged with addition of these revenue sources. This is no time to be shy nor rest on our rent growth projections! While rent growth contributes to revenue, providing opportunities for ancillary income is a bounce to NOI just the same- often without a corresponding cash outlay.
PowerHour® Ancillary Income For Property Management Professionals and Leaders is a 15-Point Audio Course that provides in-depth detail on how to implement the strategies for immediate income to your bottom line.
Ancillary Income is about:
1. Straight Fee Income — which means, understanding and applying/instituting industry best practices and charging the correct industry fees to those who are renting your apartments, single-family homes and/or condominiums from your property management company.
2. Referral Fees — which means, earning monthly fees for the new and expected services provided to your rental housing residents.
3. Fees For Services — which means, earning monthly fees for new fast-emerging and smart/creative ways for giving extra levels of services to your rental housing residents plus creating a living environment they never want to leave.