What to Consider Before Managing Your Own Rental Property
Updated: Sep 2, 2020
Many people like the idea of making "easy" money in real estate. But the truth falls far from the easy flow of purchasing a property, renting it out and collecting money. For many owners and investors it is worth it to use a property manager. Here are a few things to consider before managing your own rental property.
Do you own 4 or more rental units? The federal government states that anyone who owns 4 or more rental units need to abide by fair housing law. This doesn't mean that if you own multiple properties you can't manage them yourself. But it does put added liability on an owner. Fair housing can be confusing and difficult to understand. There are a lot of do's and don'ts, as well as changes that happen without much notice. With federal, state and local laws many individual owners find it confusing to understand and abide by. Overland Management is up to date on fair housing, federal, state & local laws to provide you with excellent property management services.
Finding a Tenant:
Seems simple enough, but usually leans towards more of a daunting task for someone who doesn't have experience. Listing your property for rent locally can sometimes bring in a plethora of interested applicants, but what do you look for?
How do you check their credit history?
What about their criminal history?
Do they have enough income to continue paying rent?
All of these are common questions that come up when finding a potential tenant. It is important to understand the warning signs of a possibly bad tenant. At Overland Management we maintain a high standard of screening to protect our investors. We check not only their credit and criminal records but also search out eviction records, income & employment history, and rental history. With many years of experience we know what to look for and what questions to ask.
Treating it like a Business:
There are financials, taxes, communication, records and documentation that is required on a rental property. It is easy to get caught up in your regular day to day life and forget to write something down or record it properly. Then months go by, and it is now impossible to remember exactly what was said or happened, let alone prove it if needed in court. Overland Management simplifies this step for their owners by utilizing professional property management software, and record keeping procedures so that the records & reports are ready and accessible if/when they are needed.
Property management is an emotionally fueled business. It can sometimes be hard to treat it as a business instead of personally. There are many wonderful tenants, intermingled in with a few bad seeds that take advantage of those who are sympathetic to their story. People fall on hard times, but all too often an owner is taken advantage of and ends up regretting it when it is all said and done. It is important to maintain a good relationship with tenants but continue to keep them at arm's length when it comes to the business of renting. Using a trained agent alleviates the pressure and emotion from the rental owner, that sometimes comes with being a property manager.
When weighing the cost of a property management company vs. doing it yourself. One of the most important items to think about would be the time involved. It isn't as simple as collecting rent each month. The time it takes to find and process a tenant is usually considered, but what about the rest of the tenancy and beyond. There is a lot of time involved with maintaining the property, dealing with complaints, and following the multitude of laws and regulations. And that is in a good rental situation. What about when something goes wrong? When it comes down to how much your time is worth, many owners find that hiring a property manager is the best solution.
Contact Overland Management today to find out how we can help save you time and money on your rental property!