Video: Realities of Being a Landlord
Realities of Being a Landlord Video Transcript
Thank you for choosing Real Property Management. We look forward to helping you take care of your home and get the best return possible.
For many first-time landlords the property management business seems pretty simple: put up a sign, the property will lease quickly, the home will stay in mint condition, and the rent will roll in on time, usually covering the mortgage and maintenance costs. But before long, many owners have a different experience. Situations arise involving problem tenants, late payments, collections, maintenance surprises, complaints from neighbors, and possibly code violations. And despite careful screening, seasoned property owners often see their share of evictions, criminal activity, vandalism, accidents, and possibly even lawsuits. These unfortunate events are part of the daily business of residential property management, even when everything has been done to avoid them.
The bottom line is property management involves the personal lives of your tenants. It comes down to people and stuff: People are unpredictable and stuff breaks.
Real Property Management has the experience and systems to help you respond quickly to the realities of owning rental property, while keeping costs down and the rent coming in. As we begin our relationship we’d like to share a few tips for success.
For starters, remember that vacancy is the single highest expense for owners. For example, a home with a $1,000 monthly rent is vacant 30 days, you make the unit ready, rekey it, cover utilities and lawn care during vacancy, pay the leasing fee and carry the cost of vacancy days. you can quickly see why minimizing vacancy time is so important
There are three ways to help control vacancy costs.
First, make sure the unit is rent ready. A home that is not in rent ready condition will stay vacant longer because in this market your unit has to compete for a good tenant. Completing needed repairs can actually save you money because the unit will rent faster.
Second, budget for maintenance. Historically, the national average for maintenance costs on a rental home total about one a half month’s rent, more for older homes, less for newer ones. So, if your home rents for $1,000 a month, you should anticipate spending approximately $1,500 in repairs throughout the tenant’s year lease period, not including make ready costs in between tenants. Be prepared by anticipating maintenance issues and budget accordingly.
Third, respond promptly to tenant maintenance requests. Remember, the tenant is your customer and how promptly you respond directly impacts on how long the tenant stays.
With frequent problems, the tenant will start looking elsewhere, and turnover and vacancy expenses are coming your way. Plus, taking care of the property in a timely manner encourages a tenant to care for it as well.
At Real Property Management, we understand the key to success is to approach tenants with a sense of fairness and open communication. Just think of yourself as a renter, and become the landlord you would like to have. The money saved and lower vacancy rates and tenant care of the property will be well worth the little extra service you provide.
While owning rental property usually isn't as simple as it seems, Real Property Management has the experience and resources to help you manage the day-to-day realities of the business.
Thank you for trusting Real Property Management. We look forward to serving you.