When buying a rental property you are sure to be thinking about all the money you can earn. But what happens if your rental property turns into a money pit? Unfortunately, this happens way too often. If you find yourself in this situation you need to consider all your options.

What can you do to stop the bleeding? Are there any major problems that need to be addressed? It is very important to know what you are up against. You may think that the repairs will cost a lot, but until you tally them up you never know for sure. If you are lucky you may be able to fix your rental property once and for all so it can eventually make you the money you were dreaming of.

What about selling? This is an idea, but you may lose money if you do so too soon. Remember, all of the problems you are having will be seen by potential buyers. This may scare them away, or cause them to throw ?low ball? offers your way. There is nothing wrong with selling, but you need to think long and hard about doing so if you are going to take a big loss.

A rental property money pit can sour you on this industry forever. Be careful about what you buy. A smart investor can avoid properties that are going to suck them dry. If you do get stuck with this type of property you should consider all your options including making the necessary repairs and selling.

photo credit: Living in Monrovia

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Learn the 5 things that every lease must contain. Without these items your lease or rental agreement will be missing important elements which could cause your problems in the future including possible lawsuits.

Names?

Including the names of your tenants seems obvious but many landlords only include the name of one tenant. Rather than single out one tenant, make sure every tenant signs the lease or has their own lease which they’re required to sign.

Occupancy Expectations?

Spell out occupancy expectations in writing. If you only allow two tenants per unit then let the tenants know that they cannot invite others to move in. Also if you do not allow pets then this must also be stated in the lease.

Financial Expectations?

Not only should you state how much rent will be but you should include any security deposits and other deposits, you need to state if the tenant is responsible for their own utilities and additional expenses.

Term of Tenancy

Is your lease a rental agreement or a fixed term lease? Rental agreements are a month to month agreement and tend to self renew. Fixed term leases typically last a year and then are renewed or terminated. This needs to be clear to all parties.

Access to Property

Most states or local areas have laws about when a landlord can enter a tenant’s apartment and how much notice must be given. This should be stated in the lease, but you should also include information on emergency entrance or notice necessary to make repairs or perform routine maintenance.?

By including these five points in your lease you’re protecting yourself from some problems in the future or legal actions against you. These are by no means the only information that is necessary in your rental contract but it’s a great starting point.

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photo credit: MinnaertOne of the best ways to protect your rental property and tenants is through regular maintenance. This is something that many rental property owners neglect because they are too lazy or busy to do so. While you may be able to get away with this for a while, you never know when a small problem that could be prevented through regular maintenance will turn into something much more serious. (more…)

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Are you trying to add value to your home? There are many ways of doing this. Many people focus all their attention on the interior of their home including upgrades to bathrooms, the kitchen, etc. While interior upgrades can go a long way, adding value to your home can also be accomplished via the proper landscaping. Many homeowners find this hard to believe, but it is true. (more…)

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More and more tenants are deciding to negotiate with their landlord due to increased competition within the rental market. Is this something you are facing? Are you expecting this to come up in the near future? If so, you need to know what you are doing.

Tenants who want to negotiate are trying to do one thing: get you to lower the price of your rent. This is something to be aware of at all times. Even though it is the tenants right to ask for a lower rent, it is also your right to tell them no. Remember, you own the property and as long as you are consistent you have nothing to worry about. Of course, there may be times when you want to negotiate with a tenant to keep them around.

If a tenant asks to negotiate their rent you should listen to him. No, you don?t want to lose any money, but if it means losing the tenant altogether you may be better off negotiating a bit. There is no denying that taking less money from a well established tenant is often times better than venturing out and hoping to find another quality person to rent your property.

When tenants want to negotiate you should listen. Just make sure you know where you stand, and that you stick to your guns during this process. There is nothing wrong with lowering your price if this is based on market data, as well as your own personal wellbeing.

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Do you want to add value to your home? Maybe you are doing so because you are going to put it on the market soon enough. No matter your reason, you should know that there are several easy interior replacements that are right up your alley. And in most cases you do not even need to obtain professional help. (more…)

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To increase the value of your home you should consider making a few repairs here and there. And to start, you should look at the exterior of your home. After all, this is what you see when you pull up to your property as well as what others see when they drive by. Fortunately, there are many easy exterior repairs that will add value to your home.

To start, if you have siding you will want to make sure that it is in very good condition. Are there any pieces that are sticking out? Are there any marks that can be removed? Even if your siding is old you can still repair it to look better as opposed to spending a lot of money to get it replaced.

Moving on, don?t overlook your front door, screen, lighting, and mailbox. In most cases these are things that will standout. Unfortunately, they can also become damaged and ?old looking? soon enough. In most cases, you can easily repair any of these areas. For instance, if your front door is peeling a new coat of paint is all you need in order to fix this problem and in turn add value.

As you can see, there are many exterior home repairs that you can make. Consider those that you can easily complete on your own, and in the long run you will find the value of your home sky rocketing.

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With the housing market at bargain rates it may be hard to keep your rental units full of good tenants, but by using some of the following tricks you can increase the revenue you’re getting for your property.

The Best Rental

The key to remember is that if someone perceives something to be of quality and value they’re more likely to buy that product or rent that apartment. You need to be proactive and put yourself out there as the leader in quality, appearance, and service and let people know that your property is the preferred brand, even if it isn’t.

Curb Appeal

Curb appeal is key, especially if you’re trying to get new tenants. You’ve already put yourself out there as the best place to live, so now you’ve got to prove it from the surface. Maybe you can’t tell the book by the cover, but I’ll bet you’ve bought a lot of books simply based on the front cover image and the blurb on the back cover.

Point out Benefits

You’ve spent a lot of time and possibly money making sure people know your rentals are superior to the others on the market, so keep driving that point home. Create an attractive handout that the tenants can refer to throughout their tour and after they’ve gone home which has highlights mentioned and even photographs. But reemphasize that with note cards throughout the apartment so the prospective tenant has an actual memory of the feature that is tied to the handout.

Hit the Senses

Sure you’ll make the apartment look good to prospective renters, but try to hit some of the other senses as well. Play background music, if it’s slower than the standard heart rate people will “shop” slower and be more likely to buy rather than rush through. Create a scent that is not only comforting but one that hits the taste sense also. I.E. chocolate chip cookies. Back some in the unit you’re trying to rent and leave them out for guests to snack on, there’s nothing like comfort food to make people feel at home.

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The idea of using any sort of media to encourage your tenants to communicate with each other might be terrifying to you. This need not be the case. It is a simple matter of understanding where you stand with your tenants and acting accordingly.

1. Do you consistently underserve your tenants with inferior housing for their money?
2. Are you slow to respond (more than 4hrs) to tenant emergencies?
3. Are you difficult to deal with in every-day tenant-landlord interactions?

If you answered yes to any of the above questions, you’ll want to work on changing your business approach before attempting to build community among your tenants.

If you think you do a pretty good job at meeting the needs of the people you provide housing for, consider incorporating some new media into your community approach.

• Set up a page on your website (you have one, right?) where tenants can log in and participate in discussions that pertain to their location.
• Provide some extra value for your tenants by making them aware of upcoming events that relate to the complex they live in.
• Build lines of effective communication by using email and your website forums to make it easier for your tenants to share their delights and concerns with you and your staff.

Opening new lines of communication doesn’t mean you need to commit to talking all the time…just that you’re open to the idea and willingly fostering a community. Your tenants will appreciate the effort and you’ll reap the rewards.

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Many people want to get involved with real estate investing, but have one important detail holding them back: their day job. This leads to the question of whether or not it is possible to manage rental property as a side job. If you can find a way to work this into your life, without quitting your day job, you may be onto something.

Simply put, it is possible to manage rental property as a side job. But that being said, this is far from easy. If you are going to get involved with real estate investing you need to make sure that you are willing to put in the time. Unfortunately, many new investors underestimate the amount of time that it takes to manage a rental property.

You may find that you need help sooner or later. In this case you should not be afraid of looking for outside assistance. For instance, if you cannot get around to making every repair you can hire a handyman to help you out if you get in a bind. Yes, this means you will have to pay money out of your pocket, but over time this is not as bad as you may think. By hiring help you will be able to keep your rental property in good standing without having to spend every waking moment thinking about it.

If you are up to challenge you can most definitely manage rental property as a side job. Before you buy your first property make sure you are aware of the pros and cons, and that you have a backup plan in place in case you get bogged down at your regular job. Once you get started you will have a good feel for what goes into rental property management. What are you waiting for? If this is your dream go for it!

photo credit: Skaneateles Suites

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