I get this question all the time....How can I save money and make sure I am the most profitable. While I can give you my speech on the importance of a good management company, making wise investments, etc I believe, in my humble opinion, that the absolute worst thing you can do as a landlord in a way to "save money" is become a slum lord. I've seen a lot of investors recently decide that they are just not going to fix things. For example, A company that I use to manage for (but no longer do because of these practices) decided that heat in the middle of January wasn't urgent. They ended up taking 44 days to fix the problem. And not because they were waiting on a part or something crazy (if those would even be excuses for a 44 day wait) but because the discount hvac guy they used was booked up and they refused to pay emergency rates. They ended up saving about $1800 on the furnace replacement but ended up with a 5 figure fine. I also had the time that an owner decided that they didn't want to "waste the money" to properly take care of a mold issue. They ended up getting sued by the tenant for a lot of money and losing.
Even if you know better then to be that extreme, let me also mention the mindset of taking good care of your tenants. I'm not saying bow down to every ridiculous request a tenant makes (and we surely have seen it all) but I am saying, that if the tenant is making a reasonable request for a repair, handle it in a timely manner. Don't try to save a couple bucks by not doing it at all or taking a crazy amount of time to find someone who is "cheap" to handle it for you. Tenant's decision to stay in your rental property 9 times out of 10 will be based on the way they are treated. Even if the tenant outgrows your property, they will ask to move to another property of yours (if you have multiple) because they enjoy having you as a landlord. I've had many tenants request to move from their current place because it is too small and want to move into a different one of our units. The cost of turn overs is far too great to be changing tenants every year.
One last thing to keep in mind, your asset is the house. If you are not handling repairs you are not taking care of your asset and are reducing your equity in your home. And if you decide you are done with rentals or even just want to sell one for some cash flow, you are limiting yourself on your return on your investment. Remember as an investor that you do not want to pay full price and someone else wont want to either, especially if it isn't turn key, so keep up with the small stuff as it comes up and you can avoid a large repair down the line.
Hope this helps!
