Most Self-Directed Real Estate IRA investors already know that you can charge rents on investment real estate, which can be reinvested for retirement or used to support current projects.
But professional property managers also understand that your income opportunities are not necessarily limited to rental income. For Self-Directed Real Estate IRA property owners who are creative and resourceful, there are endless possibilities for generating ancillary income streams from real estate investments, over and above the normal rental income.
This is especially true for multi-family units and properties where there is a significant amount of land.
Here are some ideas we have seen on different kinds of properties:
- Vending machines
- Coin and card-operated laundry
- Parking space rental for special events at nearby venues
- Storage units
- Short-term lease premiums
- Water delivery service
- Mineral rights
- Thoroughfare/passage rights
- Operating a bodega, snack bar or convenience store primarily for residents, or creating one on site and leasing it out to a third-party vendor
- Buying nearby real estate space and installing needed businesses
- Farming and ranching
- Leasing for special events
- Pest control fees
- Valet trash collection
- Delivery services
- Concierge services
- Car detailing/washing
- Whole building WiFi
- Recycling programs
- Bike storage
- Pet rent fees (excluding service dogs and therapy dogs)
- Communication tower rental
- Rental furniture
- Cable and internet bundling service deals
Of these, vending machine income is among the more common options, and can work well even in smaller apartment complexes and in both residential and commercial contexts. Today’s landlords have more options that can efficiently generate noticeable additional income within their Self-Directed Real Estate IRAs with minimal cash outlays or effort required on the part of the investor.
Do not limit your thinking to snacks and soft drinks: Today, vending machines commonly dispense everything from toilet paper to cell phone chargers.
Increasingly, the trend in recent years has been for Self-Directed IRA landlords who own multi-family units to partner with specialized laundry room vendors, rather than attempt to do all the legwork themselves.
Having some furniture, you can rent out with a unit also increases your flexibility to serve young families, people traveling for work and relocators, while still getting some income for your trouble.
Trash collection fees, lease buyout fees, late fees, non-sufficient funds fees and other reasonable fees can also provide a bit of additional cash flow to cover expenses.