Mahi Sall, Advisor, Fintech-Bank Partnerships, Payments and Financial Inclusivity
January 25th, 2023
Mahi Sall is the CEO & Founder of FinXpair, a Berlin-based strategic advisory boutique firm focu[...]
Understanding The Importance Of Rental Property Management
Jul 4, 2022
Image source: Pexels
Most people consider rental properties to be a form of passive income. In its very essence, it is, yet it is not as simple as buying a place and putting it aside for the time being. Once you find a suitable place that will make a good rental property to buy, there is a whole list of tasks and responsibilities that you need to do that will make your rental property a good investment. Some of the things you will have to manage include tenants, finances, and the property itself.
Regardless of whether you decide to manage the rental property on your own or hire a rental property manager to run the business on your behalf, you need to make sure that everything works. So, here are a couple of things you should know about managing a rental property.
What Are the Key Responsibilities of Managing Rental Properties?
In its very essence, there are three main categories to be distinguished, each of which plays a critical role in running this type of real estate business. The main responsibilities of landlords include:
- managing tenants
- managing finances
- managing the property
In this case, tenants play the main role in a rental investment. So, taking enough time to choose and select good tenants will increase your chances of achieving your business goals. However, the other two categories are not less important.
Managing Tenants
Honestly, it is not easy to work with people, and this is why working with tenants demands good people skills, especially when you face some of their complaints. If you are not good enough at managing this business on your own, hiring property managers to help you out with your property will be the best solution to the problem. Effectively dealing with the most common complaints and addressing them proactively will most certainly help you boost your retention rates and will represent you as a good landlord.
Showing your interest and attentiveness post-problem is one of the great ways to show your tenants that you genuinely care about their comfort and well-being. Additionally, performing regular inspections of the property is a great way to always be updated on the current state of your home and ensure even better conditions for your tenants.
Image source: Pexels
Managing Finances
The greatest concern of all landlords is that tenants are not paying their rent. A tenant who is not responsible and who does not pay their rent on time is a major problem. However, worry not; there are a couple of efficient ways for this problem to be solved. One of the best ways is to have online rent payments that will leave enough time for your tenant to collect the money and for you to be paid on time.
Property Maintenance
When managing a rental property, one of the crucial steps is to keep the property safe and in a habitable condition. The point is that you will struggle a lot to keep your good tenants if maintenance is the main issue. Typically, it is much more cost-effective to keep your property in check and maintain it regularly instead of dealing with the problems only when there is some kind of emergency situation. So, handling some serious maintenance problems can cost you thousands of dollars, and moreover, these may not be covered by insurance.
Hoses, drain lines, washing machines, and dishwashers should be regularly checked and replaced every few years. Additionally, if the property is older, changing faucets and valves as well as conducting some basic plumbing checkups will save you from some serious situations such as property flooding. Performing these checkups can keep you safe from unpredicted expenses. Also, remodeling some of the key areas, such as the kitchen and bathroom, can be a good investment.
See: How Proptech is changing the real estate industry
Repairing instead of remodeling can be even more profitable and will keep your home safe, but only if done thoroughly. All in all, having regular cleaning and checking of your home and having it documented will keep you on the safe side. On the one hand, this will allow you to spot and inspect some of the maintenance problems so you can avoid dramatic situations, and, on the other hand, you will give enough time to your tenant to repair the damage they caused.
Managing a rental property is a task full of responsibilities that need to be done with the utmost attention. If you notice that you are not capable of handling this on your own, hiring a property manager will help you relieve the stress by knowing that a professional is managing your property.
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