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Do you know all the hidden costs of being a landlord?
Bankrate identified six costs every property owner should know about.
For starters, every real estate investor needs insurance for their properties. You always need funds ready for maintenance repairs, including emergencies. This fund should also include financing for necessary upgrades.
Of course, you have taxes to pay on each property. There's also the subject of utilities like water, electricity, and garbage.
Real estate investors always need marketing and administration budgets for campaigns, lease enforcement, and more.
Vacant properties will incur even more expenses the longer they remain unfilled.
Thus, you can only keep a successful portfolio with property management.
However, should you handle these tasks or outsource them to another company?
Learn how the ladder option is best.
Tenant Placement
Real estate investors can avoid a lot of costly issues with the right tenant placement strategy. It's best to make a larger but smarter investment from the beginning rather than pay a serious price down the road.
One of those investments is tenant placement.
Consistent tenant turnover is expensive to maintain. This means you have to keep marketing the property, clean out units, draw up new contracts, pay for more lease enforcement services, and so forth.
However, outsourced property management uses its expertise to find long-term tenants to deliver on their ROI.
Property managers don't leave any stone unturned in their tenant placement process. They start by identifying qualities in an "ideal tenant" and craft a general profile with this data. The goal is to attract, convert, and retain this tenant through marketing, lease administration, and property maintenance.
It helps to break down expenses by tenant to see how much you're spending to acquire and keep tenants.
Lease Enforcement Help
One of the biggest mistakes landlords make is to write their own lease contracts. Avoid this pitfall at all costs and hire a real estate lawyer instead. A reputable Austin property management company can handle these important tasks for you.
You must clearly define every term of the lease in the contract to avoid any legal issues or extra expenses. Lease enforcement ensures leases are being followed to the letter. If you invest in lease enforcement services, tenants who aren't following their contracts can be issued warnings for not paying rent, property damage, behavioral issues, and other issues.
Lease enforcement occurs before the eviction stage. Eviction terms must be defined in the contract to avoid the costs of missed rent payments and drawn-out legal processes. A real estate lawyer will know exactly what stipulations to include in a contract to avoid costly legal fees.
The above issues can also impact your ability to sell your rental property to another investor. You want to prove a history of good tenant placement with high ROI. Buyers don't want to inherit any issues with rental payments, property damage, and other challenges.
The Benefits of Lease Enforcement and More
Every investor should leverage the advantages of professional lease enforcement and smart tenant placement. Outsourcing these tasks will yield a much higher ROI which generates more financing for your portfolio.
Monte Davis Property Management Services are experts in all aspects of lease administration. Our team is highly qualified in all areas of property management, but most importantly, we care about each property we manage as if it were our own.
Learn why owners trust us with their properties.
