Lots of people call Florida home: locals, snowbirds, investors, etc. But even with all those people combined, the state still has space. Lots of space.
Experts propose that a healthy vacancy rate for a metropolitan area should be somewhere between 2% and 4%. According to the latest census data, the vacancy rate in Florida is more than double that: 8.72%. And that’s just factoring in rental spaces; if you add the number of parking lots into the equation, the amount of unused potential space skyrockets.
If you’re a prospective or existing property owner in Florida, the statistics can feel disheartening, especially since COVID-19 has exacerbated the problem. How can you generate more passive income from your investment when the state’s vacancy rate is already so high? That’s the million-dollar question this article aims to answer. Let’s look at three ways you can earn more money from your property.
Capitalize on Dead Space
As mentioned, parking lots are a puzzle for property owners – especially commercial property owners. Often largely unused, they represent untapped earning potential. But what can you really do with that dead space?
You have to think outside the parking space. Florida is home to REEF at Reeftechnology.com – a company that licenses open urban areas, like parking lots, and turns them into community hubs. REEF licenses your parking lot (or a portion of it) and fills the space with modular businesses like delivery kitchens, mobile health clinics and e-commerce fulfillment centers.
In turn, you earn passive income by collecting licensing fees for every on-site application. Plus, the hubs enrich the community with new products and services, potentially making your commercial space more desirable (see: the point below). It’s a win-win.
Prioritize Livability and Amenities
If you are on the market for an investment property, consider livability and amenities. Look for properties that are close to public transit, have good walkability scores and feature several amenities in close proximity.
Renters (whether commercial or residential) want convenience. And oftentimes, convenience boils down to that old adage: location, location, location. The best piece of advice here is to team up with a knowledgeable local realtor, someone who understands the rental market and can direct you to locations with potential.
To start, check out this Investopedia article on how to vet a neighborhood for livability; it contains insights that you can take to your realtor as a jumping-off point.
Add Value
Finally, if you want to attract renters to your passive income property, you need to cultivate happy tenants.
Several experts online extoll the virtues of keeping tenants happy because happy tenants reduce turnover. The last thing you want is for tenants to leave due to avoidable problems, miscommunications or inconvenience.
Therefore, look to add value to your property wherever you can. Stay on top of plumbing, electrical, pest control and air-conditioning issues (that last one is critical in the Florida heat!).
Set up clear lines of communication so you can update tenants and they can reach you (or a manager) with issues. And don’t be afraid to add value cosmetically, through curb appeal projects, updated lighting, painting, art and more.
As property owners continue to navigate the long shadow COVID-19 has cast, turn to proactive solutions for generating passive income. Choose your location wisely, add value wherever you can, and turn your parking spaces into a thriving community hub of modular businesses.
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