In the United States, rental properties are more popular than ever, with approximately 48.2 million rental units, according to recent Census Bureau data. Investing in properties can be a lucrative income stream, allowing you to build your assets.
However, issues like difficult tenants and problems with maintenance and upkeep can destroy your investment property management dreams. Investing and managing properties is no easy task but learning what to focus on will make everything much smoother.
Read on to learn ten valuable investment property management tips that will take your business to another level.
You might be surprised to learn that many real estate investors don't take the time to do this. It's all too easy to start investing in numerous real estate properties and take a day-by-day management approach.
However, understanding your investment goals is one of the main steps to getting started in real estate.
Also, having long-term goals and a solid strategy will keep you motivated and focused each day. This is especially the case when you first begin investing, as you're more likely to manage your own properties.
Due to this, you need to stay organized and focused. You can start this process by asking yourself questions like:
Don't be afraid to make adjustments along the way if you need to. This will help you adapt better as you work to build your real estate investment portfolio.
When you're managing your own properties, you'll have to deal with paperwork constantly. For this reason, having a good file management system in place is crucial.
Don't forget that depending on how many properties you have, you'll have multiple documents to file like:
Having this system in place will allow you to better manage any problems with legal disputes or fair housing. It will also make it much easier to handle leasing and maintenance issues quickly.
Finally, part of getting organized means taking a look at your daily tasks and thinking about what you could start outsourcing.
Managing rental properties is all about communication. If you don't have effective ways of communicating with your tenants, your investment will suffer long-term.
Remember, you have to be available to respond to all issues promptly. The best way to improve this is to streamline all communication. One way to do this is via a property website with a portal that allows tenants to submit requests and download forms.
The last thing you want is for your tenants to be wondering why they can't reach you to report serious issues.
Take the time to set up a weekly schedule and stick to it. You can then book times to check in with tenants and other aspects of your rental property. This will also help you improve communication and avoid procrastinating on necessary tasks.
Don't overlook the benefits of working with a real estate agent. It can help you with both your investments and property management more than you realize.
First, real estate agents know the local area like the back of their hands. They know exactly where the best properties are. This knowledge can help you find properties in popular neighborhoods.
Finding the best locations for your property investments will allow you to price your rentals accordingly and make more money in the long run.
Real estate agents also have an in-depth knowledge of the real estate market. This means they understand how certain trends can impact property sales, like inflation and high unemployment rates.
They're also great for networking since they can connect you with inspectors, appraisers, or other professionals you might need. Other benefits include:
They can also access property listings you might not be able to find alone.
The truth is, having a real estate agent is like having a team member. Trying to go it alone is one of the biggest mistakes you can make in real estate investing.
It's critical not to overlook the importance of preventative maintenance. Having an effective maintenance plan is a huge part of establishing a solid foundation for your real estate business.
Don't forget that preventative maintenance allows you to find minor issues before they turn into something worse, costing you a fortune. For example, the last thing you want is the heat to stop working during freezing temperatures. The same thing goes for the air conditioner during hot summertime months.
All of these little things add up and can really do a number on your monthly cash flow if you don't plan ahead. Not only can they affect your cash flow, but they can also damage your reputation.
So, put a maintenance schedule into place and stick to it. An easy way to do this is to create a rental checklist and start planning weekly and monthly maintenance.
Managing properties is much more complex than you may realize at first. You have to deal with laws, rules, and regulations that change frequently.
In addition, maintenance, lease agreements, and tenant screening can take a lot of your time and energy.
For those reasons, you need to get familiar with tenant rights. First, the Fair Housing Act states that you can't refuse housing to any potential tenant based on sex, race, religion, familial status, or disability.
You also need to be aware of the Fair Credit Reporting Act, which dictates the ways you can use a potential tenant's credit history for screening purposes. For example, you must get permission to run a credit report and provide information on the credit reporting agency you use.
The best way to handle this is to establish a standard tenant screening process. This should include things like employment history, rental history, and a background check. You'll also want to run a credit history.
If you have multiple properties and tenant screenings, consider outsourcing this to a property management company. These companies are well-versed in the laws of your state and will ensure fair tenant screening practices.
You won't be successful in investment property management if you don't have a solid marketing plan in place. Otherwise, how will people even know you exist? Listing your property for rent or as an Airbnb doesn't count as a marketing plan.
If you're managing your own property marketing, you should start with search engine optimization (SEO). This involves optimizing your property management website so it ranks higher in search engines.
This is vital because if you don't rank high enough in the search engine, then nobody will see what you have to offer. SEO involves keyword research to find high-volume keywords that potential renters are using.
Other marketing options to consider include:
Overall, marketing is a huge undertaking on your own, so take it one step at a time to avoid feeling overwhelmed. Don't hesitate to get professional marketing assistance to create a marketing plan that gets results.
If you're on a strict budget, consider working with a company to improve your SEO. Although it can take time for you to see the full impact, it's a wise long-term investment.
To be successful at investing and managing properties, you have to have a strong desire to achieve success in all aspects of your business.
One way you can do that is to create a journal for growth. It's a great way to get mindful and think about how you can grow your investment.
Also, be curious, and don't be afraid to ask questions. Always be on the lookout for more innovative ways to meet your investment goals. Don't be afraid to try something new to see how it works out. This could be new technology or a new way to communicate with tenants regularly.
Finally, don't be afraid to make decisions. Once you decide on something, stand by the decision you made and be confident in yourself. You'll keep learning along the way.
When you first invest in a rental property, it's much easier to manage the property on your own. You'll have time to navigate the waters and figure out how to make things work.
However, as you begin growing your investments more and more, you'll find that daily management tasks will take too much time. This gets in the way of your ability to continue making investments and other upgrades to your business.
Ultimately, it's better to have a professional company manage your property since it allows you to focus on other things. Property management companies can take care of a variety of tasks for you, such as:
Property managers also use property management software to manage payments and maintenance requests online.
Even if you think you can't afford to hire a property manager, it's crucial to look into the costs further. In most cases, your investment will turn into income quickly.
Improving your financial wellness is vital to investment management. This is especially the case if you're new to real estate investing and managing your property for the first time.
It's challenging to set clear and realistic investment goals if this is your first time dipping your toes in these waters. Remember, real estate investing is a long-term commitment. You have to be able to determine how much you can afford and set a budget before making a sizeable investment.
One of the best ways to improve your financial wellness is to team up with a company like The Virtual Real Estate Team (VRET). The professionals at VRET will teach you about the Oklahoma City real estate market so you'll have a good understanding of the investment potential.
With VRET, you'll schedule an initial appointment to discuss your financial situation and goals. You'll then receive a custom plan that will guide you toward meeting your goals.
You'll also receive an action plan that helps you put everything into action so you can get maximum return on your investment. This will reduce your risk of paying too much for a property or making risky purchases that won't pay off in the long run.
VRET can also help you find a property management company that's right for your investment needs.
Finally, you'll get access to free training resources that allow you to take training courses at your own pace. You'll find courses that include building wealth from existing properties and courses for repeat investors.
Following these investment property management tips will help make real estate investing a much easier process overall.
If you're ready to take your real estate investments to another level, you can turn to The Virtual Real Estate Team. We help investors grow their real estate investments in Oklahoma City and can help you achieve financial wellness.
We've sold over 2,500 investment properties over the past 30 years and also continue to actively invest.
We can help you with various aspects of your investment like finding a property manager, choosing the right market, and reducing your risk overall. We'll help you create a plan and stick to your investment goals.
Make sure to contact us today to start growing your investments now and shape your future.
Joe Pryor is a professional real estate investor and has been helping new investors find profitable residential properties for over 30 years. He created The Virtual Real Estate Team to help teach new investors how to get started investing in real estate. He loves teaching and has a growing YouTube channel where he creates new training videos regularly.
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