Managing a rental property is not something everyone can do; hence most people hire managers and other staff members, but owners managing their own property is not unheard of. So, today we are here to help you become the most efficient manager of your property in a few easy steps.
There are many aspects of managing a property, contracts, repairs, maintenance, and keeping the tenants up to date with their payments; all of these are as hard as they sound. But with efficiency and proactive measures, one can always ace at being the perfect property manager.
Let’s get started with the 7-step guide that will help you take your business in hand and run it with high efficiency.
Acquiring the Property and Repairing It:
You cannot manage a property if you don’t have one, so the first and most obvious step is to buy a property and start repairs. There are many things you can do to make sure that the property you buy is rentable and will give you a high ROI. More modern repairs with modern amenities will provide you with better tenants and a better rental rate as well. Also, finding a prime location does not hurt too.
Rental Price and Expectation:
After the repairs and fixing the property, you are now ready to rent it out, but wait, before you find the right tenant, you need to set your rental prices. And you cannot do that without market research.
The area of your property can help you select a rental range for your property; anything can seriously hurt your ROI. The average rental range of the area will help you gauge how much or less you should keep your rental price. To get the research going, here are a few questions you should get answers to.
- The average income of the tenants or owners of the area.
- The average size of the families living in the area.
- The average rental range of the area.
- Perks that your area has to offer to your tenants, like parks, parking benefits, tracks, high-way access, etc.
All the other rentals and analyses will help you understand the renting dynamics and help you range the perfect rental price.
What are your tenant requirements?
Apart from the rental pricing, the expectations of tenants also matter. While you cannot discriminate against tenants, you can turn them down for having or not having some drawbacks or qualities. For example:
- The minimum income of your tenant
- Whether your tenant is a smoker or not
- Whether they have kids or not
- Married or not
- Pets or not
Renting It Out:
Once the precedent of the tenant requirement is set, you will enter the most exciting part of your management tenure. This is also the most difficult task, finding the right tenant. If you fail this, you may find yourself dealing with a tenant that can be a big nightmare. Here’s how you can go about finding a tenant, and if luck is on your side, you will land the best tenant ever!
You can advertise on free platforms like Facebook and other such social sites, but if you have to pay, it’s totally worth every penny. Sites like Zillow are highly active sites for property listings. List your property in the best way possible, with clean and clear pictures that will help your tenant see what a catch your rental is.
What is a Good Tenant?
- A good tenant will always have the following qualities:
- They respect your property just like they would respect their own.
- They adhere to the rules you set.
- They consistently pay their rent in time.
- They steer clear of any trouble that might land you or your property in trouble.
While interviewing all tenants, you can easily gauge their nature and conduct towards your property, but it’s also a good move to have them fill a questionnaire that will help you determine whether they are any good for your property or not. A standard questionnaire should have the following questions:
- Current location and employment details
- Credit score
Apart from that, you will also need to run the credit and background check and call all references. There is a chance that after doing all this, you might end up with a bad apple, so if you have the choice and resources, take services from a third-party tenant service. Once you find the right tenet, here’s what follows:
- Drawing up the contract, reviewing it, and getting it signed. You should hire a lawyer to avoid any miscommunication between yourself and the tenant.
- Walk your tenant through, also have a witness present, keep a documented proof of the property’s condition and the amenities that it comes with.
The role of an owner takes a backseat as soon as the tenant moves in, but the role of a manager becomes more active than ever. You may not be called day or night, but mark you, there will be emergencies and issues that will need your proactive and instant attention. Here is how you should manage.
Schedule rental Visits:
Visiting your tenant on a scheduled pan will help you keep things in line. It will also help you check on your property, check -in on your tenant, hear complaints or concerns as well as get you in his good books. This both for the benefit of your tenant as well as your property.
Collection of Rental Payments:
The most satisfying part of the job is collecting the rent; there are many ways you can do this. Figure out the best way that works for you and your tenant.
- Check drops
- Check mail
- Electronic rent collection
- Collecting in person
However, the collection also comes with a few other aspects, such as
- Raising rents after a considerable time or change in market.
- Having a clause of late fees in your contract and imposing the clause
- Dealing with such situations is also a part of rent collection, so be sure you are ahead of your game before such happens.
This is one part that no one enjoys, but at times it becomes extremely necessary. In such situations, the rental agreement can play a huge role. If drawn right and with the aid of a lawyer, the rental agreement will help get rid of a bad apple.