You obviously got into the property management business to make money, but if you’re not careful, you could risk not getting the full benefit, or worse – losing money on your investments in the long run. The good news is there are things that you can do to help ensure that you’re truly getting the most out of your rental properties and not just keeping things from going into the red, but turning a decent profit over time. Here are 4 simple tips to help you manage your properties in a way that will have you consistently maximizing your returns.
Keep Up with Maintenance
This includes both routine maintenance and renovations to make your properties nicer and more marketable. Not only will doing so increase the perceived value of your rental homes, but it will also make them more attractive to both potential renters and existing ones. When a tenant knows that you’ll be on top of maintenance requests and are interested in regularly beautifying their living space, they’re much more likely to stay for the long-term. Property management software can help keep you on track with incoming requests and upcoming scheduled maintenance so nothing ever falls through the cracks.
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The more often you have to clean up, advertise and re-rent your properties, the more money you’ll be losing over time. Especially if any of your properties remain vacant for any amount of time. To maximize your return, you have to attract and retain quality, long term tenants. You can improve your chances of doing this by following tip number one and keeping your properties well maintained, properly screening your prospects, and proactively working to develop good relationships with your tenants. The harder you work on your end, the greater the reward you’ll reap in terms of good tenants that will be in it for the long haul.
Reduce Your Overhead Costs
There are plenty of ways that you can cut costs on the back end of your business to help improve cash flow and achieve a more favorable bottom line – all of which we’ve discussed in previous blog posts. For instance, you can:
- Go “green” to reduce the cost of paper and printing products
- Encourage online payments to reduce the need for manual payment processing
- Reduce energy consumption within your office
- Find creative ways to market that are inexpensive or free
- Invest in property management software
Know When to Raise the Rent
Increasing rent is never an easy decision, but it’s something that every property manager or landlord must deal with at some point. Provided that you are careful, do your research, dot all your “I’s” and cross all your “T’s”, and communicate openly and honestly with your tenants, implementing a rental increase doesn’t have to be difficult. If you’re finding yourself losing money, even after doing all of the other things listed here, it may be time to consider an increase. Remember, you’re in this business to make money, so do what you have to do to achieve that goal.
When it comes to property management, the bottom line is about turning as much of a profit as possible. If you’re diligent about focusing on the right areas, like those mentioned above, you can vastly increase the return you’ll receive on your investment, making you much more successful consistently over time.
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