Property Management Success: 7 Key Factors DIY Landlords Must Do
I often get asked what the critical property management duties and responsibilities are as a DIY (Do-It-Yourself) landlord. And so, my view is that if you follow these steps, you’re setting yourself up for a much more comfortable and headache-free process.
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The truth is: There is no finite answer, but these are key areas to focus on:
1. Property presentation
A tenant is highly unlikely to be interested in your property if it’s unclean, messy, and in a state of disrepair. One of the frustrations of being a DIY landlord is having to deal with the transition period between tenants, but making sure a property is in a habitable situation at all times —especially for viewings — will pay back in more income, greater tenant return rates (especially if your property is marketed for vacations), and favorable tenant reviews and recommendations.
2. High-quality marketing
By ensuring that your property is well-presented will facilitate being able to take high-quality pictures and allowing for your property to be appropriately marketed. Use high definition equipment and a fish-eye lens to accentuate the available living space and views. By using neutral color themes and styles throughout your property that are highly attractive and not too obtuse or extreme, adds a certain level of aesthetic value.
Focus your marketing material on the stand-out features of your property. Sea/countryside views, garden areas, and spacious rooms are all highly appealing features to focus on in your marketing material — not that small, single bedroom right at the top of a house.
Ensure that you target high-traffic and reputable websites and media for your marketing. Flyer marketing can be an effective solution, especially in areas where you know there might be tenants who are looking for somewhere else to live. However, if you don’t possess an artistic streak, then this is an aspect that should be outsourced.
3. Market research
There’s no point charging $1,000 per month for a one-bedroom apartment when every other apartment on the street is consistently charging rents of $700. For such diversity to exist, your property needs to stand out from the crowd exceptionally.
So, don’t compare apples with pears; make sure your market price is relevant to the suburb, town, or city that your property is in. Take into account similar sized properties that have similar features and selling points that yours does: Views, access to gardens, a spacious and well laid out kitchen, security, local amenities, and access to public infrastructure and shopping districts all play a part in determining your market price. You’ll only be able to charge what someone is willing to pay, so don’t price yourself out of the market, and do your research.
We’ll look at some of the basics for making an intelligent financial decision. With increased awareness, a heads-up for potential pitfalls and helpful resources, you can greatly improve the odds of creating wealth in real estate.
4. Excellent communication
By responding to tenants and potential future tenants swiftly and effectively, you will go a long way in ensuring your success as a DIY landlord. No current tenant will want to have to wait more than 24 hours to hear back about an urgent repair to the heating in the middle of winter. No future tenant is going to want to wait more than 72 hours to view your property, especially if they’re looking at similar properties.
Also, keeping in touch with and establishing a strong working relationship with a team of repair and maintenance people is highly advisable. In time, you’ll build a level of trust with them and be able to send regular work their way. Positive and efficient communication will go a long way in ensuring this is the case, and you’ll then be able to call on them in an emergency, serving your tenant’s and their needs at the same time — a very powerful formula.
Even if you can’t act on a request or don’t know the answer to a question, reply to acknowledge you’ve received the message anyway and find out the solution or make sure the issue is resolved in a timely manner. The important thing is to keep in contact with every single stakeholder. Without tenants and a habitable property, there’s no income. And without income, there’s no business.
5. Time management
Combined with excellent communication, managing your time effectively as a property landlord is pivotal. By scheduling your week in advance — on a Sunday, for example — you can decide when exactly during your week you’re going to do the most essential tasks. At a glance you can see if there are any gaps in tenancies for scheduling repairs, cleaning, taking updated photos, replacing furniture, and everything you need to do to run your DIY landlord business correctly.
This can also be drilled down to each day so that when you wake up, you already know what you’re supposed to be doing that day. It can be very easy to sit back and put things off, especially if you don’t have a job to go to and your day is entirely yours to manage. By being proactive and scheduling up front, you know exactly what you’re doing and when — this will remove complacency and will help in improving your business success.
6. Prioritize your tenants’ needs
I’m not saying that your tenant is always right because sometimes you might need to stand your ground, however, by not listening to them and communicating with them poorly you’ll be doing yourself and your business a disservice.
You don’t need to become their best friend, but you can be a helpful and positive landlord with minimal effort. Don’t put off fixing the heating because you were going for a run that day, don’t ignore their texts or emails because they stained the carpet, and most definitely don’t ignore them because you had scheduled a specific time of the day to do your accounts and taxes.
Be flexible with your time management, prioritize your tenants — and potential tenants — and don’t forget to communicate timely with them!
Once you’ve taken a serious look at the reality of rental ownership, you might be excited to get started or decide to take another path. If you’re still thinking that it’s a workable plan, here are 9 rules to live by.
7. Manage your finances
Cash flow is highly important as a landlord, and so knowing exactly when your tenants are paying their rent in comparison to when your mortgage and regular bills need paying can seriously remove any money-related headaches from your life.
My suggestion is that you have a spreadsheet set up that you can easily maintain for each month, with income and expenditure separated but with totals that indicate if you’re ever going to be in a negative cash flow situation. If this does happen, it can be countered by having some capital put away for emergency needs.
This also extends into knowing how profitable your business is, without needing an expensive bill from an accountant who’s telling you that a property is making you a loss. What you should really be outsourcing to them is your taxes, where their expertise is really worth paying for.
Use your time management planning to schedule in time at the very beginning of the month to set up the month’s forecast, with a weekly review that only needs to take 10 minutes, and then a review at the end of the month for your ongoing financial position.
If you are brand new to property rental as a landlord and these seem to be a little overwhelming, you can start first with communication and time management. With these in place, all the other property management duties and responsibilities will later fall into line much easier. Obviously, that isn’t to say that they will happen automatically, and you’ll need to work on them; meanwhile, being a DIY landlord success can be highly rewarding and profitable.
When the words “on the street” is that your property is known to be presentable, comfortable, is pitched at the right market price, and you’re not known as a “landlord from hell,” then you’ll get tenants through the door very well. Just make sure to keep them.
I hope you find this article helpful; if you do. Please share it with others whom you think can benefit from these tips as well. Thanks in advance and I wish you all the success!
Guest posted by: Buttonwood Property Management