Buying a property to rent out can be a great investment – but only if you know how to manage it properly. Improperly handled properties will see a significant turnover in tenants, and you may find that fewer people are willing to rent to you if you have a bad reputation as a landlord.
At the same time, managing a property can be challenging. It’s one of the main reasons many people who consider buying an investment property decide against it or choose to offload the task to a strata management company.
It is, however, possible to make the process easier on you. Here are some tips to keep in mind to make property management easier, while also ensuring you’re approaching it the right way.
1. Follow the Law
Not only is following it a legal requirement, but landlord-tenant law can also provide you with a management structure to follow. Keep in mind that aside from federal landlord-tenant law, several states have their own local laws as well. You will have to check to make sure you’re following both federal and state law.
Following the law will not only make it easier for you to manage your property, but it will also make you a more attractive landlord for potential tenants. This will increase your pool of applicants and allow you to be more selective when choosing renters.
2. Try a Property Management Software
While you may be able to handle a smaller property without much help, larger buildings bring with them their own unique challenges. With numerous tenants to deal with, it can be challenging to keep up with everything on your plate and complete day-to-day maintenance, paperwork, and other essential parts of the job on time.
That’s where property management software comes in handy. As pointed out by the people behind, with such software, you can not only save over 20 hours per week, you can also increase both your profits and rental renewals year-over-year. Additionally, the best software is incredibly easy to use, so you don’t need to be a tech whiz to get started.
When choosing the perfect software, check to make sure it offers multiple functionalities. If you need to have different software to deal with maintenance, accounts, and tenant issues, there’s a risk you may find yourself feeling confused. By choosing one that can handle it all, you reduce the risk of that happening.
3. Remember to Complete Maintenance on Time
One of the advantages of renting instead of buying for tenants is that the landlord has to deal with any maintenance problems that arise. On the other side of the coin, as the property owner, you need to ensure that all issues are dealt with as soon as possible.
A properly maintained property is far more attractive to potential rentals. Additionally, you are legally required to ensure that certain health and safety standards are met, including repairs and maintenance. If you ignore or delay your legal responsibility, your tenant may be able to withhold rent payments. Additionally, they will have the standing to contact local authorities for help, which can result in significant fines and penalties from the government.
It’s essential to make sure you handle maintenance requests on time. Not only will that make your tenants more comfortable, there’s also less of a chance you’ll forget about it!
4. Manage Tenants
One of the biggest parts of managing any rental property is managing the tenants that rent the units. Ideally, you want to ensure tenant turnover is as close to 0% as possible, so you don’t have to spend time, energy, and money trying to find new renters.
Reducing tenant turnover means ensuring that they are happy as possible. Part of this means ensuring maintenance jobs are completed on time. However, you will also have to speak with them frequently to better understand any concerns they may have and think of ways to address these issues.
Additionally, make sure to check your rental prices often. If prices in your neighborhood for comparable properties drop, and you don’t change your prices, you will likely see an exodus of renters. By making sure you’re offering competitive prices, you reduce the risk that people you are renting to will shop around for better offers.
5. Stay on Top of Your Taxes
While a rental property can be an excellent investment, it does come with certain financial responsibilities. The most important of these are the ones you’re legally required to meet – your taxes.
Taxes on a rental property can be a confusing maze to navigate – not only are there several potential deductions you can take advantage of, but you also need to learn the ins and outs of a completely different set of laws. It’s best to hire a skilled accountant with experience in property law – not only does this make things easier on you, but it also means you won’t have to worry about getting things wrong and being fined as a result.
6. Hire a Property Manager
It is possible to manage smaller properties on your own, especially if you only own one. However, when you have a larger property (or numerous units), maintenance becomes more challenging.
This is, of course, without considering the fact that doing things yourself can be tiring, even when it’s only a single, small property. To make things easier for you, it’s always best to hire professional help.
A manager can handle the day-to-day minutia for you, so you can focus on the rest of your life. However, you should do your research before making a hire – while a great property manager can help boost your profits, a poor one can be disastrous. Make sure to screen potential managers carefully and conduct interviews, so you are confident in and comfortable with your choice.
Proper management will allow you to get the most out of your investment, which is especially important if the income you receive from it is essential to your monthly finances. Make sure you know the home properly and are ready to handle any challenges that may arise.
If you feel that managing a property is too challenging or time-consuming, make sure to reach out for professional help. It’s always better to hire a manager than to try and do too much and adversely affect your renters.