Property management is no joke and it shouldn’t be considered one. It should be treated as professionally as other sectors as it involves a whole lot of factors other than just collecting rents that need to be assessed and taken care of.
To be extraordinary in property management you need to imbibe a whole of qualities and avoid many pitfalls. If not the most complex one, this industry is one that is termed chaotic by experts. However, if you take note of some common mistakes and avoid committing them, I am sure you will be able to script your success story easily.
Various Aspects of Property Management
· Screening of tenants
· Collecting Rents
· Regular inspection
These might look too few and easy to handle, but there are quite a few things to consider and factor in so that you are not pushed into deep legal troubles.
Let’s first understand what property management is about and what the whole hue and cry is?
Once a property owner decides to rent out his property, he should be clear as to how he is going to manage it, whether he is going to take the mantle on and do everything by himself or will he enlist the services of a professional property manager who will look after every aspect.
Whatever be the case, there are potential traps such as legal implications that you might get stuck in, so it is imperative that you garner thorough knowledge of the tenancy legislation.
What Are these Common Mistakes that Can Happen?
1. Failure To Screen Tenants
A vacant property is a headache for a landlord but it can be catastrophic to get a tenant without conducting a thorough screening. So, don’t be in a rush, run a solid check of the prospective tenant before you let out your house.
Tip: Run a credential check of the tenants through service providers like RentPrep and National Tenant Network.
2. Not Enforcing Tenancy Agreement:
A tenancy agreement is an important document that should be made whenever you are renting out a property. Why? Because it is a legally enforceable contract that lists the length of the agreement, the rent that needs to be paid, and the condition under which the property should be returned.
Being good is fine, but renting out properties involves money, and money matters should always be kept clear.
Tip: The agreement should be in writing. Verbal declarations are not valid in a court of law.
3. Not Asking for A Bond
It’s an important step to successful property management. A security deposit is the safety net that ensures protection for you in case there are arrears or damage to property.
A security deposit amount is what will also act as a cover in case the tenant fails to vacate within the stipulated date for failure to pay rent.
Tip: Check the rules in your area regarding the amount you could charge.
4. Failure To Maintain Property
Maintaining your property is a responsibility that you should do without fail. Failure to do this may make tenants look for a better place. Many landlords consider it an unnecessary expense but remember this is the best to show the tenant that you care.
Also, try and clear out property tax and other insurance before the due date so that you don’t get pushed into deep debts later.
Tip: Regular maintenance will not just ensure a good rapport with tenants but also increase the life of your property.
Property management like real estate wholesaling is not for the faint heart, so be prepared for many challenges as you go along and get ready to wet your feet. But a few things borne in mind could help you sail through smoothly.
It’s not a bad idea to enlist the services of a property manager who can take care of luring quality tenants, collecting rents, and ensuring the property maintains its sheen for a longer period.
However, if you do decide to do it all by yourself mark these pointers, chalk out a plan and give it your best shot. After all, hard work will always pay off.