Passive income is golden. That’s probably why you got into real estate.
But, becoming a landlord is not easy. If you’re managing properties for the first time, you might be overwhelmed by the new role that you play.
Here is a guide on how to manage your rental properties so that your money keeps flowing in without a problem.
Take Care Of Your Business
When you enter the world of real estate investing, you’re starting a business. Your properties are the means of generating income; your tenants are your clients.
Even if it’s your first time managing rental properties, there are simple rules you can follow to be a successful landlord. If you’re not confident in your abilities, fake it until you make it.
Here are the three simple rules to keep in mind:
- Be professional
- Keep on top of your bookkeeping
- Be serious about your business
If you stay organized with managing all the paperwork throughout the year, tax time will be a breeze. Take care of your business and it’ll take care of you.
Market and Spread the Word
There’s a reason why companies spend millions of dollars on marketing every year. All efforts go towards spreading the word, raising brand awareness, and increasing revenue.
Although, it is true that not every business has the budget of a large corporation. Small businesses are recommended to spend 1% of their revenue on marketing and advertising.
Technically, you are a small business
When you spend money on marketing your property well, you attract a lot of potential clients. This opens the pool of candidates that you can rent to and increases the chances of you landing a good tenant.
A good rental property management company will help you market your rental properties and find the tenants for you. This will save you a lot of time, effort, and headache.
Draft a Solid Lease
The risk that you take as a landlord is that you’re most likely renting out your property to complete strangers. Even in the case of renting out to family, there are inevitable complications.
A solid lease can solve at least 99% of those problems.
This single piece of document outlines the expectations and rules of both landlord and tenant. It protects both parties, but more importantly, it protects you and your property.
Make sure you draft and sign a good lease to avoid headaches in the future.
Maintain Good Relationships
Your tenants are your clients and you want to keep the good ones for as long as possible. They provide a sense of stability and security in your cash flow every month.
Maintain good relationships with your tenants and they won’t go looking for a new landlord.
To clarify, it isn’t bad to rent to new tenants every year–it’s just costly. The expenses of move-in and move-out cleanings add up over time. That doesn’t even include marketing services to find the new renters and managing the properties over time.
If you have a good tenant, hold on to them. People go where they are treated best. Make sure that’s where your rental properties are.
Managing Your Properties Without the Headache
Are you serious about developing your real estate investment portfolio? Are you ready to move from managing your first rental property to managing a handful?
Then, you need to look into hiring a rental property management company.
With a rental property management company, you can develop a repeatable system to acquire more rental properties quickly. More properties equal more paydays.
If you found this article helpful, check out more from our real estate and home sections!
