Rental Property Management Essentials for Novice Landlords
Once the rental income property has been purchased, the next thing the new landlord must do is successfully manage the day-to-day operations of the property in order to keep the units full at the highest rent per square foot possible. In other words, the real estate investor must consider property management.
Many hire a professional property management company to handle this, while others prefer to handle it themself. It's a matter of budget and logistics. Professional property management companies charge a fee some investors can't afford so they do the work themself, and some rental income properties are just too large for owners to handle so they hire a professinal.
Okay, so it seemed like a good idea to consider the following eight rental management basics for those of you who prefer doing your own property management when it's logistically feasible and you want to save the out-of-pocket expense for a professional service.
It's not intended to be an exhaustive list by any means, but it should give you an idea of some proven principals to help you get started on the right foot.
Property Management Essentials
1. Property condition.
Getting the best tenants and commanding the highest rent starts with a sharp-looking building that has good curb appeal. Keep the structure, landscaping, common areas, and parking in good clean condition.
2. Tenant applications and screening.
Require each potential tenant to complete an application, and then follow up to verify their employment, rental history, and credit and criminal history. Remember, it is always easier to get tenants into your building then it is to get tenants out of your building.
3. Emergency repairs.
Be sure you have reputable maintenance personnel on-call to service emergency repairs. This may be your job or someone you hire, just be sure the tenant has a "repair help line" they can call 24 hours a day when something must be fixed immediately.
4. Aggressive marketing of vacancies.
Get the word out about an upcoming vacancy instantly. Use signage, advertise in the newspaper, or post it on the web.
5. Move-in/move-out coordination.
Always plan to get a unit "rent-ready" within a day or two after it becomes vacated. Even when you don't have a new tenant in the wings, a clean unit ready to show a prospective tenant does help.
6. Keys and locks.
It is always a good idea to change locks each time you have a turnover in tenants. This added security is good for you and your new tenant.
7. Learn the laws about eviction.
Know what you must do to evict a deadbeat tenant even when you don't think it is necessary.
8. Keep accurate books and records.
Maintaining a good income and expense history is vital to your rental property business and the cornerstone to profitability.
Rule of Thumb
Whether you decide to hire the services of a professional or to tackle the job yourself, the important thing is to have a sound property management plan in place before you require it.
Here's to your success.