Most apartment complexes have open parking. The first one to find a spot, gets the spot. Until next time. When someone else might get the good space.
Apartment complexes around the country are setting aside 10% to 15% of their spaces for reserved parking. Tenants can pay for the expense of a sign for their reserved spot, plus parking space rental of $20 to $200 per month, depending on market conditions and apartment rental rates. The tenant of a luxury apartment renting for $1,500 a month would think nothing about spending another $100 for a reserved place. If you charged only $20, you’d be leaving money on the table.
Yes, there are some headaches with people illegally parking in someone else’s reserved spot. A large fine to the guilty party if a tenant, or towing the offending car if anyone else, will send the right message and avoid future problems.
Using a conservative cap rate of 6%, adding $1,000 a month in reserved parking fees results in $12,000 a year of additional revenue and an increased value of $200,000 for the property. There are no additional expenses in creating that revenue and value, because the tenant pays for the sign!
Landlords usually have a green light/red light approach to tenant screening and eligibility. Meet the requirements and you are approved. Fail, and you are denied. Instead of that, think about a 3-tier approval system.
This would be a green light/yellow light/red light system. If 640 is the required credit score to approve a tenant (green light) then perhaps the yellow light zone is 600 to 639. Yellow zone prospects might be eligible if they provide a guarantor, pay a higher rental rate, and/or prepay some rent in addition to having a security deposit requirement. Anyone below 600 is in the red zone and denied.
With this approach, you will obtain more tenants but have safeguards in place for increased credit risks.
Alabama low income housing boards have been changing their policies, and will no longer accept properties for Section 8 housing if there are outstanding redemption rights. That means lender-foreclosed properties must wait out the six to twelve months of redemption, depending on whether it was homestead exempt or not.
Tax sale properties will need a quiet title order to be sure that all redemption rights have expired.
A faster solution is to get a quitclaim deed from the former owner (or heirs) or a release of their redemption rights.
The reasoning is that the Housing Authority does not want to put a family into a Section 8 home, and then have them disrupted later when they have to move because of redemption. Yes, I know redemptions rarely occur with lender foreclosures, but the risk is still there. In addition to the cost and disruption of the actual move, replacement housing might not be available in the same area, or at all.