Looking to rent out a specific property? Perhaps you have a single-family home, or you’re looking into renting out a duplex or triplex. The point is you’re looking for the best way to profit off of your real estate investment and want to understand the benefits of each type of property and how to set proper rental rates.
For more information, we’ll be going over everything you need to consider:
Single Homes, Duplexes, and Triplexes
First, to understand how to apply rental rates to houses of different sizes, you must know the general descriptions of these properties.
According to Realtor.com, a single-family home is described as “a structure maintained and used as a single dwelling unit.” A single dwelling means that it is built for one person or family.
The benefits included in renting out a single-family home are:
- Long-Term Tenants: Single-family homes are more likely to attract longer-term tenants. Most people that rent out single-family homes are families or couples. Usually, these types of tenants tend to be more financially stable than single tenants.
- Low Property Tax: While this may not be a standard rule for property taxes, single-family home property taxes tend to be less expensive than multi-family homes.
- Lower Management: If you plan on renting out a single-family home, you’ll find that it’s generally easier than managing duplexes or triplexes. With bigger properties, there will be more for you to worry about when it comes to maintenance.
- Resale Value: Single-family homes are easier to maintain, and if properly taken care of, you can hold onto the resale value.
Duplexes & Triplexes
A duplex is considered one of two dwellings and can be built in one of two ways.
- Over-Under: One part of the dwelling is located on the bottom floor, while the other is located on the top.
- Side-by-Side: One dwelling is on the right, and one is on the left, sharing a single wall.
A triplex is a building that connects three separate residential units into one structure. It’s essentially like a duplex, but there are three residences instead of two. A triplex can share one or two common walls and is typically built to serve three different units.
While there is a lot more work required with renting a duplex or triplex property, there are many other aspects to consider as well:
- Mortgage Payments: Whether you’re choosing to live in one part of the duplex/triplex or rent out the extra dwellings, you will be able to garner the income from your tenants and put it toward the mortgage
- Tax Benefits: If you reside in one part of the dwelling, you can write off that side. If you rent out the other sides, you can receive additional write-offs for repair and renovation costs.
- Maintenance Costs: Duplexes and triplexes will usually have higher maintenance costs than a single-family home, but utility costs can be written off.
Rental Rate Considerations
When considering the rental rate, look at the following factors to best determine what makes the most sense for your financial situation:
- Cost of the mortgage
- Maintenance costs
- Property tax
- Cost of amenities
To gain a better understanding of what prices are ideal, look at other competitors. Research and see what the average rate is for the type of property you want to rent out. Consider the appearance and condition of the property, the neighbourhood it’s located in, and the type of tenants you want to attract.
Renting out your single residential home, duplex, or triplex can prove to be a difficult experience. If you’re looking for assistance in tenant selection, maintenance, marketing, or require further information about the rental process, get the most out of our reliable real estate management in Winnipeg. We know the ins and outs of the commercial and residential property game. Contact us for assistance today!