Building wealth and becoming rich is almost everyone's dream. There are many avenues to building wealth and growing a portfolio of assets. One of the avenues to amassing wealth is owning rental properties.
Rental properties can be single home properties, multi- family home properties, vacation properties - you name it! Deciding on which property to buy , where to buy them, when to buy and then actually purchasing the property is not all that is needed to succeed in this business. As an investor you need to know how much you will charge and profit on the rental property.
A good investor understands that real estate profit is not merely a matter of subtracting mortgage from rental income. A lot has to be taken into consideration. There are a number of duties that property managers have to perform. Below are the most common and crucial duties for all investors :
- Listing their property
- Processing Rental Applications
- Tenant Screening - This is a crucial stage that ensures that you only accept good tenants.
- Background checks- It is extremely important to have full info on criminal and eviction history.
- Rent Collection
- Routine maintenance
- Lease enforcement
These duties happen at different intervals but have to be done either way. Duties like rental collection are usually done once a month and routine maintenance is either quarterly or when something breaks. These duties require time and effort and a good investor takes time to understand how best they can manage their property.
Many real estate investors choose self- managing their properties by using spreadsheets to keep track of rental payments, maintenance costs and files of lease agreements , background check reports , vendors list, etc. However, this has proved to be not the best way to manage and track expenses. This method takes a lot of time that could be used in building more wealth, perhaps looking into the acquisition of additional properties.
Other investors have sought the help of property management companies . These companies take the stress off the hands of property investors but this comes at a price. Property management companies take a good chunk of the rental income which drastically reduces the profit on a rental property. In most cases, you are paying 7 - 10% from rent collection , for maintenance fees and yet other duties are not a monthly task.
Investors now have an option to use property management software. The software / application will take care of all the above duties and will not take the big chunk of your profit. You can draft your lease online in a matter of seconds, schedule maintenance online and even communicate with the vendor and tenant right away. All documents can be signed and stored online, property images when tenant moves in or leaves are also stored online. Background checks and tenant screening is easily done online as well. The application saves investors time and money yet enabling them to easily and effectively perform their maintenance duties.
A good real estate investor is knowledgeable and has a good understanding of what it takes to manage rental properties. With that knowledge he chooses the method that works best for him/her.
To all Investors, congratulations on the acquisition of your properties. Wishing you all the best as your work on determining how best to manage your properties.
Sign up for a pro account and post this stuff on the marketplace. Might sell some. Good luck.
Thanks for putting together this guide. How would you recommend finding a good deal onrental properties. I imagine you cant just buy at market value.
Great points, Josephine. How can I purchase this program. Is there a trial period?
Totally agree with @Josephine R Mukoroyi . Very good points. A good property management software will more than pay for itself. Saving you a ton of time and doing so much of the work for you. From background screening, online applications, property inspections, online payments, work order management, scheduling appointments such as showings, automatic calculation of late fees and so much more. We have rental properties and would not go back to spreadsheets.
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