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Property Management Blog

Published on Sunday, October 18, 2009

Plan For Managing Rental Possessions

 Needless to day, an effective organization doing rental property management goes a long way in ensuring easy, profitable and stress free realty investing. Some people may feel dizzy just by hearing about this system. However, although the term seems threatening, all it really means is - a good plan to maintain hassle free rentals while optimizing cash flow.


Regardless of whether the rental property is a single family apartment, a six unit property or a large 20 unit property, it is very important to maintain a good management system. Handling rental properties is simply a matter of planning well in advance possessing the right contacts, having a positive outlook of the rental field and willingness to face any issue that may arise.

The Ideal Management Plan

While managing rental properties, it would be a good idea to learn all that is involved in the industry well in advance to save time and effort. Here is a list of the most important aspects to be learnt

  • Finalize who is going to handle the maintenance and basic repairs clogged toilet or sink, broken window, leaky taps, damaged door knob, non functioning electrical plugs and the like. Is the property owner going to take up responsibility If not, can he find handymen for rental property management repairs at affordable hourly rates How does a property owner find such maintenance staff.
  • Is the property owner financially strong enough to handle severe issues like water tank replacement, maintenance of a leaking roof, installing a new furnace, filling vacant units and the like.
  • The right tenants can mean steady cash flow from the rental investments. How does a property investor handle screening of tenants
  • Dealing with tenants is another sensitive area. Regardless of the personal or financial problems of the tenants, the landlord or management company must be able to manage tenants and maintain the management organization by ensuring correct payment of rents.
  • The landlord must consider cleaning up issues like preparing a property for new tenants after the previous tenants have moved out or have been evicted.
  • Evictions are unfortunate but necessary procedures. The landlord must be skilled in efficiently handling them and must be aware of how long it would take and how much it would cost.

 

After understanding and finalizing these aspects, one would arrive at the right management plan that would streamline the running of rental properties and maximize the profits from it. It would also be a wise to employ a good organization for rental property management  to take care of the day to day issues involved in running and maintaining rental investments.

While buying a property at a good price might seem like a great start on a rental property business, it is vital to implement an effective management system to keep the tenants happy, the property well maintained and the cash flowing. Remember, a great rental realty investment system will

  • Help a landlord or management firm find suitable tenants who will respect the property and care for it well so that the property suffers nothing more than just normal wear and tear.
  • Ensure that rental property management staff respond to all requests for repairs and get it fixed as soon as possible at the most affordable rates.
  • Keep the tenants happy and satisfied so that the property will not be frequently vacated due to poor management.

 

Understanding these basics of managing a rental property will make the investments more meaningful and profitable for the property owner.

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Author: Web Master

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Landlord Knowledge Base

If you’ve ever considered investing in a few rental properties in Philadelphia or Bucks County, PA now might be a good time. Prices are still low in Philadelphia, but have been on the upswing. According to the National Association of Realtors, the median price of an existing home in a US metropolitan area grew 13.7% between July 2012 and July 2013, the latest in a 17-month streak of year-over-year price increases. 

New landlords can choose from properties that are likely to appreciate and a large pool of potential renters.Licensed realtor Pat Mueller cites a few reasons for this trend: “Many families have lost their homes to foreclosure and are entering the rentals market for the first time in years. Mortgages are also harder to get now, so fewer people are qualifying for a new one.”The more skills you bring to the table to get into Houses for Rent in Philadelphia Philadelphia or Bucks County, PA and the more time you have to devote to your properties, the faster you can make a return on your investment. 

But investing in rentals can also be disastrous (or too stressful to be worthwhile) without expertise. Here are three professionals you may consult about your new rental properties, and what you can do to mitigate how much they cost you:Handyman:  You may need to hire a specialist for some work on your rental. If you need new outlets or new pipes, for example, hire an electrician, plumber or licensed contractor. Handymen usually tackle smaller, more manageable tasks, like:

  • Painting and paint removal
  • Drywall repair
  • Minor appliance repairs (fixing a leaky toilet or faucet, among others)
  • Installing tiling or flooring, moldings, windows, doors
  • Refinishing decks, cabinets and other wood items

When You Could Skip It: You could do any (or all) of these projects yourself if you have the time and interest in learning. Of course, this only works if you live relatively close to your rentals and are flexible enough to service them on short notice. And if you’re willing to respond to the occasional 5 AM basement flooding.

Average Savings: Any base rates or costs-per-hour vary from location to location in Philadelphia or Bucks County, PA , but nationally, you can expect to spend an average of $60 to $85 per hour for repair costs. It general costs less to hire an individual handyman than a handyman employed by a company. Expect an additional charge if your job requires a trip to the store for materials.

Resident Property Manager As the owner of a handful of rental properties, you may be able to manage them yourself, but if you want help, a single resident manager would probably be more cost efficient than a property management company. Resident managers may:

  • Serve as a handyman
  • Advertise vacancies in your units
  • Show apartments to prospective tenants
  • Review rental applications
  • Collect rents

When You Could Skip It: Again, the closer you live to your properties and the more spare time you have, the less likely you are to need a manager. The obligations of being a boss will also cut into the time you save on maintenance.

Average Savings: The national median wage for residential managers is just over $25 per hour. Research the wages in your community and adjust according to how much responsibility your manager will take on. 

Real Estate Agent: Once you’ve gotten your financials in order and done your own research on the neighborhood(s) you’re considering, you might contact a realtor to show you potential properties. You can also arrange for a realtor in Philadelphia or Bucks County, PA to show rentals once they’re ready to rent.

When You Could Skip It: It depends. Even if you’re a local, or have thoroughly researched the neighborhood(s) you’re considering, a realtor is a great resource for a first-time rental buyer. Realtors have access to data and statistics not necessarily available to the general public and first-time buyers may not know all the right questions to ask. Using a realtor to fill your Houses for Rent vacancies is less of a no-brainer, depending on your other time commitments or whether you plan to hire a resident manager who could do the same thing.

Average Savings: As a buyer of rental properties, as when buying your own home, sellers typically pay most, if not all, of the buyer’s realtor fees. In this case, Mueller points out there’s little reason not to work with a realtor. For help in filling your units in Philadelphia or Bucks County, PA, the services of a realtor would set you back between 10-20% of the unit’s rent per month.  Mueller recommends interviewing with several brokers before making your final decision to invest into Houses for Rent .

The Bottom Line: As a new landlord, you can’t necessarily control the flexibility of your schedule or the amount (and cost) of unexpected repairs to your properties. Rentals are a long-term investment. However, to maximize profits from your Houses for Rent, new rentals, you can buy close to home and start small. It is best to begin with just one or two properties. This will allow you to maximize the time you spend on your properties’ needs, and minimize the amount you’ll have to pay anyone else.

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