Guide To Managing Rental Property Successfully

Every time the subject of rental property management is brought up in a discussion

, there are 5 things that are always talked about.

These are known as the pillars of managing a rental property, and are applicable everywhere, no matter where you are in the world. If you can clearly understand each pillar and how it can benefit you, then you will take big steps towards becoming a successful landlord.

This article will explore these pillars in further details.

Mortgage

Its impossible to ignore this pillar. Unless you are already multi-millionaire many times over and can pay with cash, you will have a mortgage on your rental property. As a consequence, the amount of money that you have to pay back to the bank is strictly dependent on interest rate levels. You need to be sure that you will be able to deal with a variety of interest rate levels before choosing to invest in a property. Of course, there is always a risk that other things can go awry which could cause you to default. You never know what can happen in life. Nevertheless, you should also do everything you can to minimise the risk using what you know.

Maintenance

You never know whether youre going to have a good or bad tenant. Either way, tenants generally dont treat a rental property as if it were their own home. There is always a level of neglect that takes place. You must be prepared to cover any costs resulting for such neglect. Furthermore, there will also be repairs which will need to be done that is the direct result of the age of the house. You can be rest assured that tenants will let you know about things that they want fixed. You have an interest in maintaining the property well because an unsatisfied tenant will only result in them leaving and leaving you with cash flow problems.

Insurance

You never know what can happen on your rental property. Depending on where you live, you may be in an area which is prone to extreme weather such as hurricanes and monsoons or freak events such as earthquakes. There could also be a house fire at your property. In addition, your tenant may suffer a serious accident or even die, you just never know. The 1 thing you can and should do is get comprehensive insurance for your property. This is important for successful rental property management.

Property Taxes

Dont forget to pay these every year otherwise you will have to deal with government authorities. It's certainly more convenient to look for more rental properties instead of dealing with unpaid taxes.

Occupancy Rate

Last but not least, the occupancy rate is vital for a profitable rental property. If your property is vacant more often than not, then you will almost certainly suffer a cash flow problem which could make you default. In order to attract more tenants, you may want to do a couple of things:

- lower the rent

- make improvements to the property

Either way, the market may sometimes not be in your favour. Sometimes, there is a surplus of properties on the rental market while there are shortages at other times. All you can do is be certain you are equipped to deal with both situations.

By following the 5 pillars of successful rental property management explained above, you will be well on your way to becoming a successful landlord.

by: Martin Sejas

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