Best Rental Property Unit Configurations

When setting your buying criteria for your next real estate acquisition, please include 'Unit Configuration' into your decision making. There are few factors that drive down vacancy more than unit configuration; You could have a great configuration in a not so great location and still rent the unit. But if you have a terrible unit configuration, even a decent location will be hard pressed to rent that unit out. 

Best Rental Property Unit Configuration

There are 2 primary factors to include in your unit configuration: Livability and Strategy. 

Livability small multifamily investment

The livability of a rental property is the sum of the factors that add up to a community's quality of life. In other words, suitable for living in; habitable; comfortable.  

A mantra I use to ensure the Livability of my rental properties is "Safe, Clean, Warm." These 3 words remind me that everyone wants to feel safe, clean and warm in their own homes; As a housing provider, doing our best to maintain these basic standards is essential to success. From this foundation, I want to create ease and comfort where possible.  Below are some questions to help you get in the mind of your customers and allow you to create homes that they want to live in for a long time:

  • Do I feel relatively safe here at night?
  • Am I grossed out by anything in or around my property?
  • How difficult is it to go from the car to the kitchen with 4 bags of groceries, in the dark, when it's raining, and I’m wearing high heels?  
  • How difficult is it to take out the garbage? 
Broad Strategy

As you can tell, I personally maintain a broad appeal. Most anyone would appreciate the guiding principle of home design to be "safe, clean, warm with an emphasis on ease and comfort."  Much like vanilla ice cream, everyone likes it.. but few would choose it in a line up. 

My preferred unit configuration is:

  • 2 bedroom / 1+ baths
  • In unit washer and dryer
  • At least 1 covered parking space
These units are easy to fill when vacant and produce the lowest turnover. When looking at properties, I look for units that meet these requirements or can be converted to meet these requirements with relative ease. 

The property itself should be located conveniently to either a major bus line and/or the freeway and within 2 miles of at least 1 grocery store. Most tenants are working class or students, the most annoying part of their day is their commute, and if it’s too annoying, they will be inspired to move.

how to buy rental property

When looking at upgrades, I focus on low cost rental grade improvements that increase the comfort and ease of living in the property, such as installing ceiling fans, USB outlets, or slightly above average shower head. These little details added up over time create properties people enjoy calling home. 

Match Unit to Target Tenant Base

The items listed above are my criteria, based off my experience and my preferred strategy. There are plenty of ways to skin this cat, so by all means, adjust accordingly to whatever strategy you choose. Your goal is to create a 'target tenant base' and acquire properties that meet the primary needs of this target base. For example, I’ve worked with clients and colleagues with the following unit configurations with specific population targets:

  • Property must be within 1 mile of a community college or 4 year university; Primary target is student populations
  • Each unit must have private, secure garage or able to add; Primary target is contractor / vendors populations who need secure space for truck / tools
  • Each unit must be 3 bedroom or more; Primary target are tenants who work from home
  • Property must be located in school district rated 7 out of 10; Target families who value good schools

Whatever strategy you choose, the point is to have one. You want reasons for your criteria, what subgroup are you attracting? Focusing in on a specific target tenant group will help you make decisions later on.  

For example, you could decide to focus on dog loving tenants. pet policy rental bellevue wa

  • Purchase properties within 1/4 mile of parks / walking trails.
  • Maintain a liberal pet policy
  • Install adequate fencing on all your units, dog doors, and a convenient area to bath dogs.
  • Put together a welcome packet that includes information on local parks, pet stores, groomers and veterinarian offices. Perhaps even coupons to some of these local businesses or a free tennis ball upon move in:)

All of these little, low cost items added together will reduce your vacancy time.  Anyone with 1 or 2 dogs looking for a home in your neighborhood will not hesitate to apply.  On top of that, they will be hard pressed to move because their dog(s) (aka vital member of their family) is so comfortable. 

Configuration Conclusion

Look for properties and units that people actually want to live in. Everyone wants to feel safe in their home. Everyone appreciates a home that feels clean and is easy to keep warm.  Over time, reduce everyday hassles of living with cost effective upgrades to your properties; These little details added up over time create properties people enjoy calling home, which reduces vacancy loss (and makes the world a little bit better at the same time).

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