How to Manage a Rental Property?
If a rental property is not managed correctly, it will fall into shambles. Luckily, there are several different ways to manage property to fit every landlords’ needs. You can be completely hands on, or you can decide to outsource everything. As J&C Real Estate will keep your property up, running and generating revenue.
3 Strategies for Managing Rental Property
- Managing Tenants
Rent Collection: Setting due dates. Collecting rent each week or month. Establishing late fees and grace periods. Dealing with unpaid rent.
Lease Agreements: Verifying that lease includes all legal terms required by your state’s landlord tenant law. Making sure lease is up to date with most recent version of law. Managing lease start and end date of all tenants.
Tenant Screening: Advertising vacancy. Setting up appointments. Verifying information on applications. You may also determine if certain tenants are a good fit.
Move-In: Signing lease agreements. Going over rules, requirements and regulations. Collecting security deposit and first month’s rent. Walking through and noting current condition of rental unit.
Move-Out: Verifying that lease term is actually over. Checking the condition of the rental unit for any damage. Disposition of Security Deposit. Beginning the process to find a new tenant for an apartment.
Tenant Complaints: Fielding complaints. Setting up a game plan to fix the problem.
Repair Requests: Responding to requests quickly. Prioritizing the importance of repair. Doing the repair yourself or hiring someone to do it.
Tenant Evictions: Sending tenant legally required notices before eviction. Filing for eviction with the court. Preparing your evidence which supports reason for eviction.
- Managing Property Maintenance and Inspections
The second main part of rental property management is the property itself. The physical structure needs to be maintained for the health and safety of the tenants. Your insurance company may also require certain parts of the structure, such as the roof, to meet certain standards or they will refuse to insure the property.
Maintenance: Making sure tenants have access to running water at all times and heat in the winter. Fixing roof leaks, plumbing leaks, cracked tiles, loose handrails, faulty door or window locks.
Inspections: You will have to deal with inspections from the town and even from your lender and insurance company. The town inspections are to make sure your property is following certain health and safety codes. The lender and insurance company inspect the property to make sure the property is worth the amount they are lending or the amount they are insuring it for.
- Managing Finances
The third part of management that you will have to deal with when owning a rental property involves the finances. You need to understand how much money is coming in each month and how much money is going out.
Rent Payments: How much you collect in rent each month.
Mortgage Payment: What you pay each month on your mortgage.
Insurance: How much you pay to insure your property.
Taxes: What your yearly property taxes are.
Utilities: If tenants are not responsible for paying for utilities, how much the water, gas and electric bills are each month for the property.
Fees/Fines: Fees you may have to pay for property inspections or court costs. Unexpected fines for maintenance issues at the property.
There are three main approaches:
- Do-It-Yourself Management: you are responsible for everything, hence, DIY. You are the one who is collecting rent, shoveling snow and filing your taxes.
- Half Do It Yourself/Half Outsource: you manage the areas that you feel you have expertise in and then outsource the areas that you do not feel as comfortable with or simply do not have the desire to manage.
- Outsource Management Completely: you own the property, but have no desire to be a hands-on manager. You feel that your strength is in property selection, not managing the daily operations. You will hire a property manager or property management company. Property management companies can handle everything including, tenant screening, tenant move-in, rent collection, maintenance and repairs, tenant move-out and tenant eviction. Ask for your Free Investment Analysis here with us.