Owning a rental property is great way to generate some extra income. If you’re the hands-on type, it can be fulfilling to know the ins and outs of the rental management industry. You get to build on your skills and expand your knowledge.
If you’re considering buying investment property, keep on reading! In this article, we are going to provide you with potential errors self-managing landlords usually commit. In doing so, you’ll be able to steer clear of any of these common mistakes.
1. Accepting the First Tenant
Sometimes property owners will automatically accept the first tenant who applies for the rental in order to fill the vacancy quickly.
While it’s important to fill your units, you must screen multiple prospective renters to find the best quality one for your property.
Review the background of the potential renter, and ask questions such as:
- Do they have any previous references?
- What’s their source of income?
- Are they currently employed?
These questions are important so you won’t suffer from problems down the road.
2. Lack of Automation
In a fast paced world, it’s important to adapt to challenges. Time is valuable, so make sure you are saving time by taking advantage of available technology. Software automates make processes easier! They’re worth the investment.
Some areas you can automate are maintenance requests, rental collection, bookkeeping and accounting. By automating these tasks, you won’t have to spend time arranging meetings, manually collecting rent payments and organizing financial records.
It’s imperative that you adjust to make your business operation efficient. This way, your customer service won’t be sacrificed. Automated systems will make it convenient to market a property vacancy, receive rental payments and trace reports.
3. Reactive Maintenance
Oftentimes, expensive repair can be the result of negligence. Paying attention to common damage-prone furnishings or areas of the house will save you money. It’s important to focus on preventive maintenance.
Make a list of items that need to be checked frequently, such as heaters, ventilation, air conditioning units and plumbing, and then check these areas regularly.
It’s best to have a regular schedule and know your rental property is in top condition.
4. Inferior Customer Service
Your tenants are the lifeblood of your business. Without them, steady returns are impossible. This highlights the importance of prioritizing customer service.
When tenants come to you with requests and complaints, listen attentively. Resolve issues and make life easier and more convenient for them. It’s much harder to deal with frequent turnovers due to poor service.
As a self-managing landlord, you’ll have to juggle several tasks such as conducting maintenance and regular inspections. However, never lose sight of delivering outstanding customer service. There are no excuses when it comes to serving the people who are the biggest factor in your business success.
5. Lack of Social Media Presence
Marketing your rental property business online can be strategic. This is where people can find out more about your rental space and the kind of services you offer.
Many free social media platforms exist. When conducting social media marketing, you can choose to pay small fees to boost your postings.
Social media is great because you can post images and videos that will attract tenants. You can also use social media to connect with prospective tenants and answer their questions more quickly than you could offline.
When using social media, it’s important to be active and show your presence.
6. Skipping a Move Out Property Inspection
When tenants move out of your rental, it’s essential to conduct a move out inspection to prepare the unit for the next renters.
Here are some of the things you can do inside and outside the rental property:
- Clean the rental unit thoroughly.
- Fix or replace damaged items.
- Make sure that appliances are functioning at full capacity.
- Check all the major and minor items.
When you turn over a rental unit that’s in its best condition, it will set a standard for the next occupants. They’ll strive to maintain the level of upkeep in contrast to leaving them with a substandard level.
7. Failure to Screen a Contractor’s References
Self-managing a property can be time-consuming, so you may consider hiring a contractor. That said, there are key things to pay attention to. When hiring a contractor, make sure to check the credentials.
It’s necessary to check the contractor's previous work. This way, you have a fair idea of the professional result. Otherwise, you can experience stress when your expectations are unmet.
If you want a superior job, make time to double-check references. You want to maximize your time and resources by collaborating with the right contractor. Some may overpromise and underperform, so you want to make sure that you find those who can really deliver. A contractor should be worth the money you’re paying!
8. Inaccurate Accounting
To know how your rental business is performing, your records must be accurate and reliable. How can you measure your profitability if your accounting books aren’t in order?
Using accounting software or hiring an accounting expert will benefit you a lot. You’ll be able to track your major expenses and reduce your costs in certain areas. This is an essential aspect of running your rental business.
As a DIY landlord, these are things you must continually watch out for. If you’re short on time, you can always engage the services of a professional property manager. Contact Pinnacle Property Management today at (310) 530-0606 and check out our property management services at www.pinnaclepmc.com.