The profit of owning an apartment building can be great, but there are certain things that need to be taken into consideration to help ensure success.
Determining the Right Management Type for Your Apartments
The size of an apartment building usually determines its type of management. Buildings consisting of more than 20 units are usually taken care of by a professional property management company while smaller units are normally managed by the owner and a live-in superintendent or property manager.
However, the size of the building is irrelevant when it comes to managing effectively. It’s important to think of managing an apartment building like managing any other company. It’s the management’s responsibility to make sure that everything runs smoothly while having the tenants’ best interests at mind. This includes trying to improve the overall living experience of the tenants while still keeping costs low and profit up.
I would say that the most important rules to follow as an apartment building owner are the Fair Housing Rules. These laws were put in place to avoid certain legal issues when it comes to tenants. These rules prohibit discrimination on anyone based on race, gender, age, disability, marital status or sexual orientation. It is crucial that these rules be abided to at all times by all members of the management staff, otherwise there could be some hefty prices to pay.
Repairs & Maintenance Issues
Maintenance and repairs are some other issues that must be taken very seriously. If you want your tenants to remain happy with their living arrangements, management needs to ready and willing to take care of their property and fix anything that they have agreed to fix in the lease in a timely manner.
The lease should have a detailed section stating exactly what management is responsible for fixing and maintaining as well as what the tenant is responsible for. Before writing a lease agreement, it’s important to check with your state and federal laws regarding your responsibilities or you may find yourself breaking them. For instance, it is illegal for management to turn off utilities such as electricity and water because a tenant refused to pay their rent.
The following is an example of the information a building manager should specifically include when writing a lease agreement:
The tenant is responsible for maintaining a clean unit and for paying any damages aside from normal wear and tear caused by the neglect or abuse of the tenant.
• The tenant should immediately tell management of any issues with the unit including, but not limited to, faulty wiring, water leaks, mold, or fire hazards so that it may be taken care of in a timely manner.
• Management will provide renters with a copy of policies and procedures when it comes to complaints and repair requests. Information in this section should include how quickly tenants should expect an issue to be solved, hours of operation, and contact numbers.
• Specifically mention that there are restrictions on alterations that tenants may make to the property including satellite dishes or painting the walls. If you will require permission to do such things, you must mention it in this section. If you would rather not be specific, it’s sufficient to say that any alterations done to the property must be approved by management.
• The tenant’s responsibility to maintain a clean rental unit and also pay for damage caused by neglect or abuse.
In order to keep tenants happy and avoid any possible complaints or issues, it’s important to make sure that regular maintenance and repair is taken care of in a timely manner. Issues such as leaks or heating/cooling problems should, in most cases, be taken care of within 24 hours of the tenant’s request for service. Timely maintenance and quality management will only make the owner’s life more enjoyable as well as the lives of his tenants.