Success as a landlorddoesn’t come naturally. It’s a skill which needs to be developed and as youbecome a better manager, the property makes more money and your stress levelsdecline dramatically.
Here are 7 essentials
every landlord should know about property asset management:
Treat Property Asset
Management Like a Business
Rental real estate
management is a business and should not be treated as a pastime. Too many
landlords fail to put in the required effort in managing properties. This leads
to arguments with tenants, neighbours and their spouses. So commit to treating
your investment property as a business.
If you’re a first-time
investor or don’t have much time, consider hiring the services of a
professional property management services company. They already have the
knowledge, systems and online processes required to manage several properties
simultaneously.
Present Well-Appointed
Properties to Prospective Tenants
Poorly presented properties attract poor
quality tenants nasty belongings, which is why maintaining properties in good
condition is an important part of property asset management.
Well-maintained
properties require fewer repairs and attract a higher quality of tenants who
will take better care of the property.
Get Maximum Exposure for
Your Property Listing
When renting out your
property, use as many media sources as you can to maximise the exposure so you
have a large number of inquiries from people interested in renting out
properties like yours.
The danger of having only a few people
interested in renting out your property would mean you’re compelled to make to
make a choice from a smaller pool which decreases the chances of finding your
ideal tenant.
Aside from listing on
Property websites, such as Domain and Real Estate.com, make the best use
of social media platforms like Facebook, Twitter and Pinterest to gain the
additional exposure which will help you attract more prospects.
Screen Tenants Carefully
Screening tenants to
find the ones who pay the rent on time and look after the property as if it
were their own is a key component of rental real estate management.
When screening tenants,
look at three general areas:
1. Income – which should be approximately three times
the rent
2. Job Stability – Ensure the job isn’t temporary and that
they have been in the job for at least six months
3. Rental History – They should have positive reviews from
previous landlords and no prior evictions
When it comes to human
nature, people don’t really change all that much. How a tenant has been is
probably how they’re going to be no matter what they say or how much they try
to convince you that they’ve changed.
Awareness of Rental Laws
Be mindful of fair
tenancy laws so that in the unlikely event you need to evict a tenant, you can
legally do so. If your tenant decides to bring in a dog after moving into your
rental apartment or perhaps disturbs neighbours by being noisy in the middle of
the night, there is a cause for concern.
However, you cannot
discriminate against tenants for reasons such as race, colour, religion or
national origin. So don’t inquire how many kids they have or why they’re in a
wheelchair or what religion they are as this could be asking for a lawsuit.
Be sure to research your
local laws and remember this is a business and business owners are required to
know the law and abide by them.
Lease Agreement
Sign a rock-solid lease
agreement with your tenant. Rules are there to keep everybody on the same page
and having a rock-solid lease is a fundamental requirement of property asset
management.
The lease agreement is a
legal document that spells out all the terms of the rental period as well as
the rules and regulations that govern the relationship between landlord and
tenant. They take a lot of the shooting from the hip decisions out of the
picture and give you the manager something powerful to rely on.
When making decisions, a
solid lease can protect you and the property legally in case something goes
wrong like a tenant wants to move out early, there’s garbage piling up on their
deck or anything else.
Different states have different rules, so it’s
important to have a state-specific lease, not just something that you pulled
off the internet.
Fairness and Firmness
Rental real estate management requires that landlords should be firm but fair
with tenants. Ensure that the rules and guidelines which have been put in place
have penalties such as late fees when tenants break the rules and don’t bend
the rules because you heard a sob story from the tenant. Not only does it hurt
you and your finances, it actually hurts the tenant.
Imagine a tenant calls
to say his paycheck was late and they would be a week behind on rent. You let
it slide and now you have trained them to think that’s acceptable. Two months
later it happens again but this time it’s a couple weeks late and later it’s a
month late.
Pretty soon the tenant
is three months behind rent they’re not answering your calls and you’ve given
an eviction notice a tenant costing you money. The tenant, on the other hand,
will struggle to find a place to rent because he now has an eviction notice on
record. All because you were too soft on him.
Such scenarios play out
time and time again with landlords all around the world and always ends badly.
Instead be fair but firm. Follow your rules because you are running a business.
The world of property asset management has seen a sea change with new technology-based property
management systems which provide a high level of transparency and make it
easier for landlords and tenants to manage multiple properties.
As a result of utilising
these technologies, tenants can ensure landlords are aware of any repair work
or other matters to be attended to by property managers. Landlords no longer
have to call a tenant on the phone to get repairs done, but simply compare
quotes in the property asset management portal and approve them straight away,
so the job can be done.
