Six Costly Property Management Mistakes To Be Avoided By The Rental Property Investor

Managing the properties in your rental portfolio in a hap hazard and disjointed fashion

can be a stressful and unpleasant experience if not approached in a professional way. There are costly property management mistakes that are committed by inexperienced investors which can have disastrous consequences if not spotted early.

Having an unpleasant experience need not be the norm if you know what mistakes to avoid and follow in the footsteps of the seasoned property investor.

Here are six costly property management mistakes to avoid, if you want to make your involvement in real estate rental a success.

1. Investing in "fixer-uppers" rental property.

What shrewd investor does not look for the bargain property to add to his group? And with a bit of paint, new curtains and new carpets, you can have a new tenant in no time. You will also have plenty of headaches keeping on top of repairs. As the property gets lived in, it will seem that there is always something that will need repairing.

2. Renting to "warm bodies" to meet your mortgage payments.

If you're falling behind in your mortgage payment, having just anyone to pay the rent may be a quick and convenient solution but not a good management strategy to adopt.

3. Renting to "Job Hoppers".

Having long-term stable tenants is key to hassle free property management. Select tenants that are settled in their careers and are not looking to move to the next big job offer.

4. Neglecting to carry out credit checks on potential tenants.

If you're inexperienced in managing properties and have one that has been vacant for a while, you will want to hold on to the first person who signs the lease, without doing a full credit check for fear of losing a tenant. You would be better off doing the check and losing them if necessary than not doing the check and keeping them when they cannot pay the monthly rent.

5. Negotiating the rent.

You're running a business and working to secure your long-term financial security. And you must meet your commitments to your mortgage lender. Negotiating the rent with a prospective tenant is a definite disaster in the making, putting the tenant in control and giving you sleepless nights.

6. Failing to inspect the property.

Knowing the state a property is in, can make managing that property substantially easier than not knowing.

Before putting up the property for rent, take time to inspect the property. This may seem quite basic, but sometimes you may have acquired a property which is not within your local area and may only have been examined through photos.

Tenants can treat your valuable assets as throw away commodities which would certainly have an impact on your bottom line. Be sure you are fully aware of the condition of your property by carrying out an inspection, before and during the tenancy.

by: Denis Obrien

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