So, you’ve just bought an investment property or maybe you’ve decided to let go of your property manager and take on the role yourself. Yes, managing your property yourself can sometimes be a more profitable experience than using a property manager, but the task is not easy. There are many responsibilities from ensuring your property is maintained to marketing it to get new tenants that you must take on. You should also be aware of the basics of rental properties
For new property managers, it might just be a little more than what you bargained for. However, here are a few tips that will help you prepare yourself to manage your rental properties.
As a property manager, there are three key responsibilities:
● Managing the tenants;
● Managing the finances; and
● Maintaining the property.
Before starting with these key responsibilities, it is useful to know as much as possible about your property. You should research and determine what the applicable rental rate of properties similar to the one you have is in the area. You also want to keep in mind the type of tenants you will likely have, be it families, college students, or working professionals, when setting a price. The price is a key to getting tenants, but remember that you want to turn a profit, so try not to market it too low. You also need to keep your finances in mind and calculate your cash flow before deciding on the applicable rent.
As outlined above, the key responsibilities of a property manager are as follows:
1. How to Manage Your Tenants?
Keep your tenants happy
You will need people skills when it comes to managing your tenants. A good property manager is a proactive one that they can identify when tenants have a complaint and resolve it immediately. They also try to avoid such complaints from recurring.
Keep in mind that no matter how proactive you are as a manager, it is likely that your tenants will face one problem or another from time to time. How you handle their complaints is key to keeping them happy and retaining them.
The easier you make it for your tenants to pay rent, the more likely it will be that they pay on time. Online transfers have become very popular since tenants can make payments easily using the internet.
Don’t be shy when it comes to reminding tenants if they haven’t paid their rent on time. However, be friendly about it initially because you want to keep a good rapport with them. If a tenant continually forgets to pay on time, be sure to talk to them and ask them why. Another option is to charge a late fee, however you will need to ensure that this is provided for in the lease.
If all fails, you should consider asking them to vacate the property in accordance with the terms of the lease.
For tenants you want to retain, be sure to remind them in accordance with the terms of lease when the lease is up. This gives them plenty of time to decide whether they want to move out or renew the lease. They can let you know if they plan on moving out, so you can market the place for new tenants.
During the renewal process, review the market and your finances to determine if you should increase the rent in accordance with the terms of the lease. Once you’ve decided whether to increase or not, let the tenant know in accordance with the terms of the lease so they can decide whether they want to stay or not.
2. How to Manage Finances?
The finances of the property will determine whether your investment is worth your time or not. For this, you need to keep tabs on how much money comes in every month and how much goes out. The following factors contribute to this:
● Monthly incoming rent;
● The mortgage payment on the property;
● Insurance costs;
● Utilities, if they are included in the rent cost; and
● Fees and fines such as inspection costs or any fine that may arise due to maintenance issues.
You should keep a keen eye on the applicable finances. After all, you are looking to turn a profit. When you are considering whether to increase the rent keep your expenses in mind. At the same time, increasing it too much may lead to the tenant leaving so consider finding a middle ground and be open to negotiating.
3. Maintaining the Property
Maintaining the property can take up a substantial amount of your time as a property manager. Maintenance includes ensuring that the utilities, foundation, and any other aspect of the property are in shape. To do so you need to:
Perform regular inspections
To help you identify any problem with the property, you must inspect it regularly in accordance with the terms of the lease. This will help you stay on top of any problem that might occur with the property. Inspect all aspects of the property including but not limited to heaters, electrical, plumbing and appliances you’ve installed. If you don’t know much about these things, you should consider calling in a professional inspection team to ensure things are in order. Inspection is important when it comes to ensuring your property is well-maintained and that you are able to detect any underlying problem before it becomes significant.
Taking on the responsibility to manage your own property can be rewarding if done right.
About the Author:
Renee Wainwright is the gobox Mobile Storage Manager whose years of experience in the industry allow her to provide customised and tailored mobile storage solutions to suit residential, business and corporate customer’s storage and moving needs.
This is general information only and contains only the views of the author(s). It is not financial advice or recommendations, and does not take into account your personal needs, objectives and financial circumstances. Please carefully consider whether this information is appropriate for you.