10 TIPS FOR GOOD PROPERTY
MANAGEMENT
Most “issues” related to property management boil down to 10
common pitfalls. Conquer these ten items
and you can and should be able to reach the following goals:
·
Keep occupancies full
·
Maintain a high Return on Investment (ROI)
·
Build and maintain value in the property
Good property management takes time…which is why a good
property manager can be a very justifiable expense.
11.
Screen
tenants thoroughly. We all have
horror stories of the dirtbag who left in the middle of the night and left the
unit totally trashed. Buildings don’t
run buildings down – people do. An
application is a good start. But you have to do the research behind the application. Verify rent and employment. Drive by their current residence if you
aren’t sure.
22.
Establish
policies. Without policies you open
yourself up to lawsuits at the worst and unhappy tenants at least. Tenants need to know what is right and what
is wrong. Some will still want to cross
that line, but most of them will want to stay on the ‘right’ side. Not having policies, and not enforcing them,
creates a gray area of confusion and opens everything up for misinterpretation. We have a set of rules and regulations
garnered from 25 years of making mistakes.
You should, too.
33.
Stick to
your guns. If you enforce one part
of the lease, but not another, then you are asking your tenants to read your
mind to figure out what other parts of the lease will or won’t be
enforced. Life is a lot easier when
leases are black and white. It can be
tough sometimes to “bring the hammer down”.
44.
Inspect
your property. Tenants won’t tell
you what is wrong for a variety of reasons.
Most of the time they are worried you will charge them, even when it
wasn’t their fault. But there are a host
of other reasons they won’t call – ignorance, avoidance and laziness are just a
few. Do drive-bys periodically and
inspect the interior at least once a
year.
55.
Maintain
your investment. A shoddy house will
nickel-and-dime you to death. You can
bleed (draw cash out of) a property for awhile.
But sooner or later you are going to have to pay. And when you do, you will be paying out a lot
more than if you had just kept the place up all along. On top of all that, you won’t have to listen
to Tenant complaints all the time. It
makes for much happier living.
66.
Keep it
legal. It is tough enough trying to
keep up with the lawyers. But then to
have to comply with all of their regulations is a full-time job! But the alternative (lawsuits) isn’t any
better. So just make sure you or your
agent continue to stay abreast of the ever-changing landscape. We do.
77.
Set
goals. I like to say “If you don’t
know where you are going…you might just get there!” Without defined goals, written down, how do
you even know what you want the property to do?
And don’t just write them down – review them periodically!!
88.
Know the
numbers. Generate financial reports
to tell you exactly where you are. You
can then compare these to some of your goals to determine how you are
doing. When we had just 1-2 rentals we
treated them like a hobby – and hobbies typically lose money!!
99. Save.
Set up a separate escrow account for repairs. Just because the rent is covering your
mortgage doesn’t mean you are home free. The carpet is wearing out; the roof is
wearing out. Save up a “rainy day” fund
of 3-6 months’ rent payments.
110. Be responsive. “People don’t care how much you know until
they know how much you care.” When a
Tenant calls, call them back. Not
tomorrow or the next day. As soon as you
can. In some cases, it’s the law. But in all cases, it shows respect and it
shows you care about them. And happy
Tenants stay a long time. And
respectful Tenants (and Owners!) are much easier to work with. Of course, being available 24/7 can have its
drawbacks because nothing ever seems to break in the middle of the day!!
Property management isn’t always easy. But it doesn’t have to be all that difficult
either. Hopefully these 10 tips will
help keep a smile on your face and money in the bank! Good luck!
P.S. You can always get more helpful information off our website at www.fullservicepm.com
