How successful are your rental properties? Being a successful landlord isn’t as simple as buying a rental home, placing tenants in your rental property and collecting rent. There is much more involved if you want to see your investment grow and deliver a steady stream of passive income.
Below are six rental rules which, when put into practice, can increase your chances of owning successful rental properties. Some landlords may follow a few of these rules and others may follow them all, but the key difference between consistent success and occasional success is experience and expertise in implementing each of these rental rules. That is why landlords who want to maximize their real estate investment turn to property management companies.
Rule 1: Good Tenants
Rent your properties to good tenants who pay on time. Sounds pretty obvious, but how do you do this? Successful tenancies start with tenant screening. Many landlords start by checking criminal background checks, pulling credit reports, and even reviewing civil records for past evictions.
However, to improve your chances of renting your properties to good tenants who pay on time, there are a few more steps you should take. Red Door Company not only performs a very thorough tenant screening process, which goes beyond the steps listed above, but our years of property management experience help us evaluate tenants on an individual basis. Taking these additional steps helps us pair the right tenants with the right properties and locate suitable tenants for our landlords.
Rule 2: Enforce Lease
Our second rule for having successful rental properties is to enforce your lease. Set clear policies and terms in your lease and enforce them. This may seem like another no-brainer, but landlords often find themselves feeling sympathetic with a tenant’s “story,” and end up making an exception to something agreed upon in the lease.
For your rental properties to be successful, you must base your decisions on the terms of your lease. Once you make that one exception (maybe to forgo the late rent penalty), the same issue will more than likely rear its head again. Remember, managing your rental properties is a business. If you find it hard to not make exceptions, hire Red Door Company, and we will make sure there is 100% lease compliance.
Rule 3: Regular Maintenance and Prompt Repair
Creating and implementing an annual, regular maintenance schedule on your rental homes is an excellent way to ensure your major systems (HVAC, plumbing, etc.) are functioning properly and to take care of seasonal maintenance issues like those encountered when winterizing your rental property. Also, having a 24/7 system in place to address repair issues promptly can mean the difference between a small expense and a full-blown, expensive emergency repair. For example, a small roof leak can turn into a home filled with mold.
Protecting your real estate investment by prioritizing this rule is an absolute must. Following this rental rule, especially if you own multiple properties or live elsewhere, can be overwhelming at times. If you feel like you can’t follow this successful rental rule, partnering with a property management company is a smart business decision.
Rule 4: Tenant Retention Strategy
Are you following rule #1 and renting your properties to tenants who pay on time? If you have quality tenants in your rental units, then you want to do everything you can to retain those tenants. Many landlords fail to have a tenant retention strategy, which can lead to losing good tenants, increasing vacancies and losing income.
Not sure how to retain quality tenants? This is where a professional property management company can make a big difference for landlords. Red Door Company has strategies in place which help our clients retain quality tenants, minimize vacancies and increase cash flow month after month.
Rule 5: Relationships with Quality Vendors
What’s the secret to getting the highest quality work at the best price for everything from fixing plumbing issues to carpet replacement in rental properties? The answer is our fifth rental rule for successful rental properties and the answer is to establish good relationships with quality vendors.
For many landlords, especially those who don’t live near their rental properties, finding the right person to fix a job promptly, correctly and at a reasonable rate can be difficult. On the other hand, the vendor relationships a property manager develops over the years will help landlords get the highest-quality work for the best price. Protecting your investment by and enjoying competitive rates that save you money, especially when compared to going it alone, is one key to rental property success.
Rule 6: Work On – Not In – Your Business
As a landlord, how many times have you found yourself spending so much time on day-to-day tasks, including: collecting rent, meeting contractors, showing a rental unit to prospective tenants and filing evictions, that you don’t have a chance to grow your real estate investing business? You’re not alone. It’s a common issue landlords who self-manage their rental properties face.
In order to own successful rental properties, you must find ways to work on your business and not get bogged down in running your business. You must free yourself up to make time to buy more rental properties or to just relax and reap the benefits of passive income. Working with a property management company can do this for you, and at Red Door Company, we can customize a property management package that fits your individual needs perfectly.
At Red Door Company, our experience, expertise and strong vendor relationships do more than deliver rental property success. Our property management services save our clients’ time and money, protect their real estate investment and grow their bottom line. We put the above six rental rules to work for landlords, and help our clients reap the benefits of owning successful rental properties.