Property management is a very important part of the overall management of your property investment portfolio and also part of the risk strategy of looking after the properties you own. There are several areas that need attention with property management, whether you contract a property management team or self-manage the property.
There are many more good tenants than there are bad tenants. I have heard an argument for the fact that it is better to buy good properties because you will attract a better tenant. This does hold some water because higher rents are generally paid by people who have employment and these people tend to be better tenants.
This is one scenario that springs to mind. Unsuitable tenants could be tenants that just can’t afford the rent, even though they look after the property but due to unforeseen circumstances such as illness or accident, cannot pay the rent that they initially signed up to pay. Or they could be tenants that pay the rent, but mistreat the property along the way.
Then the other scenario is where you have the ultimate bad tenant that doesn’t pay or look after the property.
Another group of tenants who are attractive to the landlord is the retiree. If they can afford your rent then these people can be the ideal tenant for several reasons:
• They want to stay long term
• They like to live in nice, but small homes so as a landlord you can purchase smaller and cheaper homes
• They look after the place because they have time on their hands
• Often they are receiving a ‘living allowance’ or rental assistance from the government, in other words a stable income
Charging a fair rent is something that should be considered at all times. I mean a fair rent for the landlord and for the tenant. Keeping good tenants can save the landlord a lot of money in the long run in vacancies, repairs and ongoing costs. A fair rent is one that suits both parties.
If you do have the ‘perfect’ tenant it pays to look after them. You might show appreciation by not put the rent up or you may pick up the garden maintenance when the next rent increase is due or do something to you do consider them good tenants to have.
It really is not much different than being in a business where you need to look after good clients.
Repairs and maintenance issues
Overdue repairs could arise from the fact that few inspections of the property are carried out and little communication between parties is taking place.
If maintenance is not carried out on a regular basis repairs can turn into major costs: things like bad electrical wiring, broken power sockets, leaking water pipes, mould in the walls, termites, leaking taps, rotting timber decks, etc. All these types of maintenance issues can turn into very expensive replacements if they are not caught in the very early stages with property inspections.
Always make sure that you get 3 monthly inspection reports and you will be up to date with what is happening at your investment property.