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Most new real estate investors spend all of their time thinking about financing, finding the right deal, and crunching the numbers. They prepare for the purchase of their new rental property, but rarely think about what comes next.
They set themselves up for a rude awakening when they realize that managing a property is a job that takes time and money on a regular basis. While we like to refer to real estate rentals as passive income, they aren’t completely passive to manage, especially if you own multiple units.
Looking for some property management tips, to ensure your tenants don’t leave, as a result of your poor landlord skills? We’ve compiled some of the best landlord advice below to make managing a rental property a little bit easier for you.
1. Make It Easy for Tenants to Apply
One of the most time-consuming tasks associated with property management is getting a tenant into your rental home. You need to list your property for rent and provide a way for prospective tenants to apply to live there.
If you have a paper application they need to fill out, you might miss on some quality, albeit, lazy tenants. Plus, paper is a major hassle for you.
Rather, you can set up simple application forms online. Using a property management website, you can even customize a quick application form, which will email you notifications once a new application comes in.
This process makes it easy to field applications and sift out lower-quality tenants.
2. Make It Easy for Tenants to Pay
From an investor’s perspective, your most important goal each month is making sure that your tenant pays rent on time. After all, if you don’t receive a rent check, you can’t pay the bills associated with owning the property.
Many older landlords make this process difficult for themselves and their tenants by requiring a physical, handwritten check on the first of the month. But nobody wants to deal with checks, even if it saves you a few dollars per month in transaction fees.
Instead, use an online platform that facilitates rent payment for your clients. Many are free to use for rent collection, anyway. Your tenant can pay from their bank account, or using a debit card. The money is either deposited first to the system or just goes straight to your bank account.
They can even set up autopay, which is beneficial for you and them. If the rent doesn’t come in on time, the system can send both you and your tenant a notice.
3. Take Time When Creating a Lease
Most landlords don’t write a lease agreement from scratch. There are many templates that you can find online, print out, and have your tenant sign.
But you can also customize them, based on your own specific needs or goals, or to make things easier for the tenant. Take your time when writing a lease, and consider having it checked by an attorney.
Ideally, neither you nor your tenant will ever take legal action against one another. But in the event it happens, a well-written lease can save your financial future.
Once you get it just right, you can use it for every tenant and property going forward.
4. Consider Pets
Real estate investors often debate whether pets should be allowed in rental properties or not. There are pros and cons regarding pets, and the decision is completely up to you.
Many landlords say no to pets to prevent damage to the home from biting or scratching dogs, or to prevent urine stains or bad smells in the property.
But many other landlords happily allow pets, since they know that 70% of families own at least one pet. This means more people who are interested in renting. Plus, you can charge higher rent, and enjoy a lower tenant turnover.
There are a few more considerations when deciding whether or not to allow pets on your property. You can find more info from reedyandcompany.com.
5. Raise Rents Annually
Each time a lease expires, you have the option of adjusting the terms and raising rents. Every year, inflation increases, prices go up, and property taxes rise. Your expenses as a landlord naturally increase, so monthly rents should also increase accordingly.
It’s easiest for a long-term tenant to make gradual increases yearly, rather than go a few years and all of a sudden have a major price hike.
If you plan to increase rents, make sure to send a renewal notice with the new terms well in advance of the renewal date. If the tenant can’t handle the increase, they need adequate time to prepare to move out.
6. Don’t Make Your Own Repairs
Newbie landlords often fall for this trap. When something breaks, like a sink, toilet, or door handle, they try fixing it themselves. But unless you have the skills necessary, and an abundance of free time, it’s not worth it.
Know who to hire and when, and build relationships with that company, since you’ll need to call them again at some point. Rather than making repairs, spend your time becoming better investors, learning how to find and fund new deals, rather than waste time on the small tasks.
7. Outsource Property Management
Wondering how to manage rental property the easy way? Don’t! Rather, outsource property management, from start to finish, to a professional property management company.
All you have to do is choose a reputable company to work with. You then hand them the key, and they take care of everything on your behalf. They will find and screen tenants, collect rent, deal with non-paying tenants, manage repairs, and so forth.
It’s a mutually beneficial situation because if they’re successful at their job, so are you. And they know you’re likely to bring them more properties to manage in the future.
More Property Management Tips
If you want to become a full-time landlord, then there are plenty of other property management tips you’ll want to know as well. But since most investors are looking to invest, rather than work a job, smart investors like to outsource their management to experienced managers.
Looking for more advice on running and growing your rental business? Visit our blog now to continue reading.