The Most Effective Strategies to Improve Cash Flow on Rental Properties
88 Strategies Sorted by Size of Cash Flow Improvement
You may have seen my list of the 88 strategies to improve cash flow on rental properties that I’ve been creating for our new coaching program for those real estate investors that are looking to buy a rental property in the next 90 days that moves them closer to financial independence despite high prices, high interest rates and lagging rents.
Here it is if you missed it:
The previous list was organized/grouped by what part of the buying/owning process that we use the strategy.
For example, I listed all the different cash flow improving strategies that we use when searching for properties.
But, in my obsession to get real estate investors the absolute maximum cash flow on rental properties, I started to think about other ways to group or sort these 88 cash flow improving strategies to make them easier and better for you to implement to get the maximum cash flow with the least amount of stress and effort on your part.
I’ve come up with a bunch of ways to sort them and group—many of which I will be sharing with you over time—but today I’ll share with you how I sorted them by how much they improve cash flow.
Some Improve Cash Flow A Lot More Than Others
There are 88 different strategies that you can use to improve cash flow.
But, 55 of the 88 strategies are most likely to improve cash flow just a little bit. In some cases $20 per month. In other cases, $50 per month. In some cases, it may increase rent by 5-10%.
You might be able to utilize more than one of these.
As just one example, maybe you adjust your insurance deductible to save yourself $100 to $200 per year in insurance costs which will improve cash flow by about that amount. But, in addition to that, perhaps you start charging pet rent and insist on leases renewing during peak season with 60-90 days notice from your tenants whether they plan to renew or end their lease. All of these combined, may improve cash flow by $50 to $100 per month on some properties. Maybe a little more on others. Or, maybe a little less.
These 55 strategies are what I would refer to as the lowest dollar amount improvements to cash flow. Even though… especially when you combine them, they can still have a significant positive impact on improving your cash flow.
Larger Cash Flow Improvements
There are 28 of the 88 strategies where you’re highly likely to be able to get even more than the smaller improvements we saw with the previous group of 55 strategies.
For example, you may decide to utilize the strategy of selecting a real estate agent that charges a reduced commission when buying and rebates you a significant part of the real estate commission. If you saved 2% of a $400,000 property in the form of a rebate from your real estate agent, that could be an $8,000 of extra cash in your pocket in the first year.
Maybe you choose to look at that as a buffer to offset negative cash flow or perhaps you choose to use that to buy down your interest rate and save yourself $200 or more per month on your mortgage payment for the next 30 years.
And, additionally, maybe you choose to utilize a slightly different investing strategy— like a short-term rental instead of a long-term rental—to significantly improve cash flow on the property in exchange for more work.
To be clear, you might be able to combine more than one of these medium-sized cash flow improvements and combine strategies in the smallest cash flow improvement group as well to get an even better improvement to cash flow overall.
I’m estimating that 28 of the strategies are most likely to end up in this medium-sized cash flow improvement group.
Of course, since this is new, I might move one or two around over time—especially as we do more modeling in the Real Estate Financial Planner™ software.
Largest Cash Flow Improvements
Even though there are about 55 strategies that can get you small improvements in cash flow and about 28 that get you a medium-sized improvement in cash flow… I’m estimating there are about 5 super-power, super-sized strategies to significantly improve cash flow.
Below I’ve included the full, unblurred image and the list of the 5 strategies for our paying substack subscribers.
Our coaching clients will get my help implementing these strategies… one of which… could improve cash flow by $13,000 or more in the first year on a $400,000 property.
Yes, I know how crazy that sounds but honestly that one in particular is one of the easiest to get—as it doesn’t require skill or changing your strategy on it.
There are other cash flow improving strategies in this group that are of similar size improvement… some of them much more difficult to implement than the easy one I pointed out above.
Would getting an extra $13,000 in the first year solve the cash flow challenges you’re facing as you analyze properties in this high price, high interest rate and lagging rent environment?
If you had a property with negative $500 per month in cash flow, this one strategy alone helps to mitigate that pain.
Paying substack subscribers can see the unblurred image and my list of the 5 most significant cash flow improving strategies below.
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