5 Easy Landlord Tips You Probably Aren’t Following (Including the One I Failed At Last Month)
I call it my “Hell Month.”
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I’ve just had the worst month as a landlord since I began leasing property almost seven years ago. I can’t explain exactly why – but I suppose it was due. After almost a year of minimal vacancies, no trouble, and no major repairs, I was suddenly hit with my first big eviction, 5 vacancies, 3 full unit turnovers, and a partridge in a pear tree.
So this list of five easy landlord tips is based on the lesson’s I’ve learned over this past month. The first four I feel I did a good job at, and it made the last few months not as bad as they could have been. However, the 5th tip, I failed miserably at.
Be sure to leave me a comment at the bottom and let me know which tip you haven’t been doing – or any other tips you can add to help others!
Alright, here we go…
5.) Hire Someone to Help You
If you are trying to do everything yourself – give yourself a small break. This doesn’t necessarily mean you need to go out and hire a full time property manager, but perhaps simply start hiring people to do small tasks for you that you really don’t want to do. It’s not that you are too good for the work, and it’s not that you can’t do it… it’s because someday you won’t want to do it all, and by that time, it might be too late.
For example, if you never hire a maintenance guy because you can do all your own work – what happens when you are driving to the airport for that trip to Europe you’ve been dreaming about and suddenly your tenant calls with a problem that needs immediate attention? By hiring people now on a small scale, you can begin finding dependable help for the future.
4.) Store Up Reserves for Your Next “Hell Month”
This past “Hell Month” was not some freak, once in a lifetime event. It happens to all landlords at some points in their life (probably multiple times,) so don’t think it won’t happen to you. While it’s easy, on paper, to allocate 5% or so of your income toward repairs, those repairs don’t come at you in nice, even monthly intervals- that’s why they are called averages. If your rental business is anything like mine, your monthly allocation toward repairs probably looks more like this:
- January: 3%
- February: 1.5%
- March: 2%
- April: 0%
- May: 0%
- June: .5%
- July: 0%
- August: 33%
(For those math nerds out there- yes, that does give an average of 5%!)
If during the soft months I had simply kept all that cash flow and thought “yay! Another great month! More Starbucks for me!” – I would have been in some serious trouble in August. However, by building up significant financial reserves, you can weather the larger “Hell Months” that will happen.
3.) Set Up Your Google Voice Account
If your tenants are still calling your personal cell phone, you are missing out on one of the best tools for a landlord – and it’s 100% free: Google Voice. Google Voice is a free service that gives you a phone number that can be easily set up to ring your own phone, or any phone you set up to take calls – and the tenant won’t know the difference. This is especially helpful for those times when you don’t want to, or can’t, answer the phone. Set up a schedule so it rings your phone at certain times, your spouse’s at other times, and goes to an answering message during dinner!
I recently hired my mother-in-law to answer phones for our rental business. It’s not a large inconvenience to her, but it frees up so much stress and time for me. She simply takes messages, deals with easy-to-fix problems, and communicates with me when the problem is more serious. This is also extremely helpful when you want to take a vacation – and actually relax.
So go get your Google Voice number today and give it to all your tenants.
2.) Communicate Often With Your Tenants
Most tenants don’t know what in the world we are thinking – and as a result: drama happens! I know a lot of landlords are afraid to call their tenants because they are worried about the list of repairs the tenant wants done, but those repairs wouldn’t pile up with more frequent communication between your tenant and yourself. Let your tenant know about repairs or improvements you plan on doing to the property, upcoming changes in their lease, important safety tips they should be aware of, or local events that might be happening.
A newsletter is a great way to keep communication open between yourself and your tenants, especially if you have a large number of tenants. It doesn’t have to be fancy either – just a simple Word document with some tips can go a loooooong way.
Also, if you find yourself too busy to keep up with your tenants – outsource that (see #5 above) to someone who can do it. Trust me – it will save you a lot of drama in the long run!
1.) Get Written Bids from All Contractors
Okay, here’s the easy, simple tip that I know is important, but still failed to follow through with last month â and it hurts. As I mentioned, I had several rental units that all needed to be turned over at once, so I hired my most reliable contractor to get to work on the needed items. Because of all the different projects I had going on at once, I just kept writing checks and assumed everything would be fine. The problem was, however, that without a written bid, I just kept saying "yes" when the contractor called to find out if I wanted to have certain tasks done.
- “Sure, go ahead and replace the shower walls.”
- “Sure, go ahead and remove that window.”
- “Sure, we need better range vent hood – the old one is ugly.”
However, when the bill came I was blown away with the amount â but it wasn't my contractor's fault â it was mine. My contractor didn't charge me for anything that I didn't agree to do â but I wasn't keeping good enough track of the costs as we moved forward. I ended up spending double what I should have spent, and many of the things simply didn't need to be done.
Instead, I should have created a plan of exactly what needed to be completed and received a bid before the work started. At that point, I could have made more informed decisions as to what was necessary and what could wait until I wasn’t in “Hell Month.” Instead, I’m cringing as my hard-saved repair reserves go out the window entirely.
Next time, I’m getting a written bid ahead of time.
So- now you know my story of Hell Month. Have you faced a similar month? Are you going through one right now?
Hopefully these five tips can help you in your rental business! So, to return the favor, do me a quick favor and leave me a comment below and let me know which of the five you don’t do yet, or leave a comment with some other easy tips that you think people can benefit from!
Also – don’t forget to share this on your Facebook, Twitter, G+, LinkedIn, or whatever!
Photo: Lolly man