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Property Management Blog

Published on Tuesday, October 7, 2008

Learn How To Manage Property

Those who have some real property must know that managing property is no easy job. Most of the people who have such property often depend on the professional managers to take care of them. The real professionals do not fail and you can gain from appointing them. But you might not be so lucky as to get a good manager. Thus you need to know at least the basics of managing your property. It will not only help you to know what you should expect from your manager but also make his task easy when he explains his actions to you.

Managing property means taking care of all things related to the property. You have invested in a property to gain from it and you must want a regular income from it to be successful. This means you want a tenant for your property. Then you must have to advertise. So the first step of the management is to advertise the property to attract the possible tenants and make sure that the expenditure on advertising does not go wasted. Make sure the news reaches the target. Once the prospective tenants start calling the next part is showing them the property and interviewing them. You must know that your decision to lease out your property does not mean that you will have to lease it out to anybody who is offering the highest rent. You need to make sure that you do not get into any trouble in the future that involves your tenants.

The next step will be asking for proper written application from the interested people along with there credit and employment details. Go through these, screen them and carry out further investigation on the ones who you find suitable. You should investigate about their background, credit history and all the references including their past employments. This may seem a bit too much but these are the safety measures to protect yourself and the property from any trouble in the future. So it is for no reason that managing property is a tedious job. You might decide on the new tenant but some more jobs need to be done before inviting the tenant. You must get the insurance on the property against theft, fire, etc.

So long the discussion was about the preliminary matters involved in managing property . Next comes the daily maintenance, a job that makes or breaks the relation between the owner and the tenant. Once you sign the agreement of tenancy, you are bound by the law to provide certain services to the tenant and mind it, they are paying the rent and they can be very demanding in this respect. You can appoint a managing company who will register the complaint and act swiftly to resolve the issue. You might have to pay more but at the same time your reputation and the value of the property also increases if you can provide swift services to your tenant.

The final matter that forms the base of managing property is maintaining the financial aspects. It covers everything from collecting the rent to managing the costs related to repairs, taxes and other sundry expenses. If a management firm is appointed, their fees also should be taken into consideration. You also need periodic inspection and repairs on the property to keep it in a good condition and these costs should be kept in consideration when calculating the return from the property. Start of and with time you may become an expert.

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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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