Real estate investors that are seasoned landlords or property managers know how important it is to do regular inspections on their property.
If you aren’t in this first group then there’s also a good chance that you are one of the unlucky ones that found out the “hard way” that you should be doing regular property inspections.
I have a family member that is the manager of a large multifamily property in a nice neighborhood. The rent for these apartments ranges from around $800 to $1200 a month and there are over 500 units. They got a call recently from a tenant for a regular work order. When they arrived to do the repair, what they found was appalling. Even though they do regular bi-annual inspections, as you will see from the pictures provided throughout this post – they still find “surprises” all the time.
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Which One of These Three Categories do You Fall Into?
- You went to work for a large company that already had good systems in place for doing scheduled property inspections. They taught you good property management principles which you continue to follow.
- You are a newer real estate investor that doesn’t have these systems in place. You found out the hard way what you should be doing after a tenant moved out and left your place trashed.
- Even though you are a brand new real estate investor and you never worked for a property management company, you were somehow smart enough to set up your own systems right from the beginning.
What Type of Tenants Do You Have?
Good Tenants. If you are really lucky, you have good tenants. They take care of your property just like it was their own house. They are responsible; they call you when there is a small problem before it becomes a big problem and the yard always looks nice. You won’t have any code violations from these types of tenants. If you are really lucky, these folks will become long term tenants.
Lazy Tenants. The next group of tenants is what I call “lazy tenants”. These people move in and never take care of anything. They don’t take out the garbage, they don’t clean the house, and in general they make a mess of everything.
Destroyers. The third group of tenants is what I call “destroyers”. They always do a lot of damage and no one really knows the reason. This may just be who they are; people that are incapable of taking responsibility for their actions or their life. These types of tenants feel no responsibility for taking care of your property.
Weeding Out the ‘Bad Eggs”
If you have single family homes, one of the best ways that you can weed out these last two types of tenants is to stop by for a surprise visit where they currently live before renting one of your houses to them. Just show up, knock on the door and tell them that you need to come in and speak with them. You can just be honest and let them know it is company policy to visit all tenants at their current residence before allowing them to live in one of your rentals.
If their current home is a mess, you can be sure yours will look the same. They will have a lot of excuses for “the mess”, but don’t let your need for immediate cash cloud your judgment. In your rush to find a tenant, you don’t want to “settle” for someone that you know won’t be a good tenant.
Schedule Regular Property Inspections
Most large multi-family communities have bi-annual inspections on their property. Some do these inspections even more frequently. The point is that they all have procedures in place not only for taking care of their property, but for dealing with those tenants that don’t follow the rules.
Whether you have just a couple of houses or a large portfolio of properties, this is one procedure you should begin to implement today if you don’t already have one in place.
3 Tips for Making It Happen
- Decide how often you will do the inspections. Most companies do at least bi-annual inspections.
- Put it on the calendar so that you can give the required notice to the tenants.
- Be sure to schedule “drive by” inspections in between your scheduled inspections especially during warm weather. Pay special attention to the condition of exterior of the property, look for unauthorized pets, and notice how they take care of the yard. If you notice anything that should be corrected, either give the tenants a call or send them a low key note. Your goal should be to turn them into good, long term tenants. If they are repeat offenders then you can take a stronger stance with them.
Have you ever encountered a tenant like this one? What is your policy regarding regular property inspections?