From Rags To Riches in Rental Properties | Mortgage

From Rags To Riches in Rental Properties

by ErinCureton

Know the rental market you are working in. The number 1 key to successfully managing rental properties is to know your marketplace. What is the right price point for your unit? How nice is your rental versus others in the neighborhood? What types of amenities are standard? Knowing the answers to these questions is usually the difference between renting your unit in 2 weeks or 6 months. The easiest way to find the answers to these questions is to call other rentals in your area and schedule a showing. You want to view as many apartments in your area as you can so that you have great knowledge about the marketplace that you are competing in.

know the local rental laws in your area. This is very important. Not much more to say. Follow the laws. If you don't, they could cost you a lot of money.

Why would anyone pay for an ad in a local paper? For the past 2 years, I have put 0 "FOR RENT" signs in my front yards. I advertise on Craigslist, Plugged-In, and other local websites that cater to higher end renters. (This is another reason you want to know the marketplace.) These websites typically attract a higher quality tenant. This tenant is not a life time renter, but a young upwardly mobile professional needing a nice place to live. In this case, if you make your place a little nicer than the rest, you can often get a higher rent.

Ask for referrals & be willing to pay for them. My best advertisers are my current tenants. I make my places very nice and I stay on top of problems that arise quickly and in a friendly manner. This makes my tenants happy to refer their friends and family to my rental units. Another way to keep my tenants referring clients is by paying them to do so. I have a policy that if you refer a friend and that friend signs a 1-year lease, I will give you half off next months rent. This is a great program!

I am most concerned with evictions on a back ground check. It is a last resort for landlords. This means they have tried everything couldn't make it work. To me if someone has been evicted, they were terrible tenants. I don't want problems, I want income. In today economy no one is perfect, so I am very understanding when it comes to poor credit.

Have a good lease written by a professional. Many people buy a lease from an office supply store or an on-line service. In many cases these leases will work fine. They are boilerplate contracts that you fill-in the blanks to complete the lease. This may work fine for you. My recommendation is to take a contract like this and get a real estate lawyer in your area to look it over and suggest improvements. A good lease is like good insurance. A little money up front for piece of mind down the road.

Be flexible on your rent. When it comes to rent, I am flexible. Let's say I want $700 per month for rent, but a tenant offers to pay $650 per month. If I wait I may be able to get more rent from someone else. If however, I don't rent it this month, I just lost $650! It will take me- month at $700 per month to make that up. If I don't rent it for 2 months, it will take me 22 months to make up that lost rent. This is where I think a bird in the hand is worth 2 in the bush. If I make a concession for lower rent, I will only do it if I get something in return, like the tenant agreeing to yard work or snow removal.

Hire 3 handymen, why just in case the first two are busy. I can fix just about any small problem that arises in my rentals, and I don't pay myself anything. However, I have 3 men who work part time. Why? So I am not inconvenienced by evening calls, late night calls, early morning calls, or weekend calls. Why do I have 3 of them? In case I can't get a hold of the first 2. My tenants are very important to me, but so is my family. So that I don't have to make a choice between them, I call my handymen. Everyone is happy, most importantly me!

Stay ahead of problems. The number 1 complaint from tenants is that their landlords are not quick to resolve problems that arise in their homes. No one cares if the kitchen sink is clogged, as long as someone comes to fix it in a timely manner. Leave it clogged, and they will move out. I tell my tenants that all maintenance calls will be answered in person within one day 7 days a week (see "Hire a Handyman.") I stick to that pledge and you will have happy tenants.

Become a friend and your tenant will want to take care of your property. Thank your customers (your tenants). If I were selling copiers or pharmaceuticals this would be obvious. Why is renting an apartment any different? Sending a holiday card, or congratulating a tenant on the birth of a new child, you may be viewed as more of a friend than a landlord. Become a friend and your tenant will communicate problems to you rather than just moving out. Become a friend and your tenants will refer their friends to you.

DISCLAIMER: This article is provided as information only and is not to be taken as financial advice.

Erin Cureton Medina Ohio is the managing partner of Cureton Property Alliance. Erin Cureton Medina Ohio Flips and rents houses in Lakewood and Akron, OH. Erin Recommends Solid Ground Construction for Kitchen Remodeling Avon Lake and Co-Op Optic for eye glasses Kent Ohio.