Management – Time, Money, Maintenance, Relationships
Management – Time
This is extremely important if you are going to manage your properties yourself. Prospects can gobble up and waste your time. The biggest tip I can give all of you is to make applicants, tenants fit your schedule. I don’t do open houses for showings – you will get nothing but lookie lous. I set a specific time and I tell the applicant to call me to reconfirm 1 hour before the schedule showing time. If I do not get confirmation I do not show up. This has saved me a lot of time and kepts me from getting angry over the inconsiderateness of many people. It keeps me from having negative thoughts about renters in general.
Management – Money
You need to have a budget. You need to set aside money monthly for taxes, insurance, maintenance, vacancy. If you don’t do this you will be stressed and in panic when you get an emergency call that the water heater has gone out. Do you have the $1000 to buy and install a new one? You will get stressed when you get that 30-day notice the tenant is moving. Did you keep the security deposit in a separate account or did you spend it? Can you afford to not get rent for 30 days during the turn over? Do you have some reserves for turnover maintenance?
Owning rental property is expensive and you need to know your long range goals for why you have this property. In today’s current market it is rare to have positive cash flow on a rental. So, how long are you willing to invest your own money into this property to reach your goals? Bottom line, you need a budget and you need to follow it.
Management – Maintenance
Here too you need a plan. You need to know how long you have to go until the roof will need to be replaced. You need to have an annual plan to do regular maintenance such as cleaning gutters annually, making sure new batteries are in the smoke detectors annually. Many owners feel if they don’t hear from the tenants then things are ok. I am here to tell you that is the wrong attitude. Tenants don’t want their rent increased so often they don’t tell owners of maintenance items.
When I bought my business I instituted an annual preventative maintenance program and the first year it was implemented I had 3 apartments that had no p-traps under the bathroom sink. Tenants had put buckets and when full emptied into the tub! We did the repair and had to convince and educate the tenants that they pay rent, they deserve to have items in the home work and it is their responsibility to report maintenance items. We had to reassure them that we weren’t going to raise their rent to cover the cost of the maintenance. So, just because you hear nothing from tenants don’t assume everything is ok. It could cost you a ton of money in the long run. I have had to gut bathrooms completely because of a water drip that was never reported. Do inspections, and have a maintenance management program that both you and the tenant agree to follow.
Management – Relationships
Stay in touch with tenants, build and maintain a good relationship with tenants, and your vendors. When emergencies arise you need your vendors to step up and help out and they will go the extra mile if you keep in touch with them.
Remember – managing rentals is a business and any part of running a business is management.
Please check out my website at www.PortolaRentals.com if you are interested in properties in Santa Cruz or have rentals in Santa Cruz, CA.
Kathleen Richards
