It is interesting when I go for a property management presentation and get questions about "tenants destroying" rental property. I know the owner has been on some DIY landlord sites and read "horror stories". Most DIY landlords do NOT have the resources, skills or education to manage their investment property successfully * hiring a property manager will actually save them money and headaches and we are cheaper than an attorney!
How do you handle decisions related to your investment property(s)? Most folks who are not professional investors, just do the same thing year after year, hoping that no real harm will come of them or their home, and wishing they will have a stellar tenant. And for many, this scenario does come true, but is it the best way to handle their financial future?
For the non professional investor, I always recommend learning the applicable laws first and getting advice from a real estate professional; however, I know many folks who just want to try it alone. With that in mind, I emphasize the importance of developing a process for everything, such as how you'll handle repairs, complaints, qualifying tenants and most importantly how to evaluate your own investment.
Here's a few tips for evaluating your investment:
- Add to your calendar a reminder to evaluate your investment, four months prior to the lease ending.
- Then identify your options, evaluate them, make a decision, and execute.
- Every year go through the process of deciding whether or not you should continue on the current path, stop it, or make a change.
By intentionally focusing on these steps annually you will put yourself in a better position to gain both financial and emotional success with your investment property.
What are your options?
- Continue to rent the home with the current tenant.
- Find a new tenant.
- Sell the home.
Each of these options has several additional points to consider and you need to determine if you are prepared to manage your own rental, find and qualify your own tenant, make repairs to the home, collect rents and deposits, evict tenants, etc., or is it time to consider hiring a professional real estate agent and/or property manager to help you properly manage your investment. BTW - also get some professional tax advice to make sure you are taking advantage of all deductions you are entitled.
In the end, it may not be worth (emotionally) the monetary monthly gain or tax deductions you may be receiving. This might be the most important factor to consider when evaluating your investment property.
Wallace S. Gibson, CPM * GIBSON MANAGEMENT GROUP, Ltd.
Central Virginia
LandlordWhisperer
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Not following landlord-Tenant code could get you in trouble - always consult a professional.
I can't emphasis enough the importance of a professional to manage investment properties. As Wallace points out, property managers actually SAVE you money.