Hi, this is Tanya at Envy Property Management, the ultimate end goal for any rental property investor will always be to turn a profit. Well, if the stars align and everything goes according to plan, this can be accomplished by simply buying a rental property, putting it on the market for rent, finding a good tenant, and then start bringing in the cash. But this isn’t always the reality for most investors, nor is it that easy. The savvy investor will know there are a multitude of factors that must be considered when choosing a property and today I’m going to share 5 smart things savvy rental property investors always do.
1. Know How to Find a Good Rental Property in Your Area
The first step in becoming a keen real estate investor is to be aware of how to find a good rental property. Don’t get drawn in by an attractive price tag, typically there’s a good reason a property is underpriced. Be familiar with the area the property is located in, good areas can differ dramatically even from one street to the next. Know whether the type of property is currently high in demand and how the leasing is going in the area. Ask questions like, Is the property in a popular area? Is the property a single-family home where most of the people in the area are looking for student housing? Does it need a lot of expensive repairs? Look at the roof, furnace, water heater, and other costly items that you could potentially be spending money on right off the bat. Look at the surrounding properties, are they in a state of disrepair? These are the types of questions you must ask to determine whether the property will rent easily.
If this all sounds overwhelming, you should always consider working with a professional property management company like Envy Property Management. We are experts in our area and can guide you towards the right types of properties, thus increasing your potential that your investment property will rent out quickly and at a competitive rate.
2. Run Your Numbers
So, you’ve found the perfect property to purchase and the price is right….now what? Before you sign on the dotted line, there’s so much more to consider besides the listing price, monthly payment, and rental price you’ll set. These aren’t the only numbers to crunch, don’t forget about taxes, insurance, maintenance costs, management fees, HOA dues, and vacancies just to mention a few. All these things must be factored into determining if your property will cash flow in the long run. Sit down and figure out these numbers, they are important. Don’t be in too big of a hurry to purchase the first good deal to come along, there will always be deals out there.
3. Advertise Your Rental in the Right Places
Gone are the days of potential residents searching the classified ads in the local newspapers to find their next rental property. Rental property hunting is done online these days. And while you may be able to place an ad here or there and get a few leads coming in, your best option is to work with a tech-savvy property management company that has the means to syndicate your rental property across multiple platforms at the click of a button. Assets such as photos, videos, and descriptions are loaded in one place and pushed out to dozens of the most popular platforms. This technology-driven solution results in your property being listed in multiple places quickly without having to manually import data to each individual site.
4. Screen, Screen, Screen
Your first line of defense when placing potential residents is to screen, screen, screen. No one wants to believe that people will lie on their rental applications, but they do. You cannot take a rental application at face value, you MUST do your due diligence in screening and verifying the information that has been provided is accurate. This is another place where hiring a professional property management company is vital. At Envy Property Management, we have strict policies and procedures in place when screening and placing new residents. You too can place quality tenants, reduce the need for costly evictions, and make the most money possible on your investment property.
Here at Envy, we have less than a 1% Eviction Rate and we have earned this achievement by applying our 20 Point Tenant Screening Process. It includes vital verification of income, employer, background, social security, credit, delinquencies, collections, prior landlord, public records, driver's license, and many many more. In order to place a qualified tenant in your rental property, you must go through a detailed screening process while making sure to not break any fair housing laws. Doing these steps will save you many headaches in the future.
When screening prospective tenants at Envy PM, we make sure that we comply with all the strict Fair Housing and Discrimination laws in order to keep our owners out of lawsuits and litigation. Make sure you are also keeping up to date on these frequently changing laws in accordance with your local and state laws.
5. Be Organized
Lastly, be overly organized when it comes to your investments. A professional management company will retain copies of your payments, expenses, leases, and ledgers. However, you too need to keep documents organized and easily accessible at all times. Whether it’s digital or paper copies, keep your information clutter-free and organized so you can get to them when needed.
This also includes being organized with your list of qualified vendors for repairs. When allowing someone inside your investment property to handle repairs, you’ll want to make sure they are licensed and insured and that you have a copy of this information for your records.
The final item you should always keep organized is your processes and procedures. You don’t want to be the housing provider that was caught breaking a Fair Housing Law simply because you didn’t stay consistent with your processes and procedures. At the end of the day, hiring a qualified and knowledgeable property manager is the best way to limit risk exposure, avoid hassles and enjoy a healthier bottom line. If self managing seems a little too overwhelming and stressful and you want help choosing a Northern Utah property management company with years of experience, please contact us at Envy Property Management. We are a wealth of information when it comes to professional property management of your investment property. You can always ask us for some valuable tips and extra resources to make the choice simple and painless. Give us a call today, 801-337-4337 or visit our website at envypm.com where you can easily view our three-tiered pricing plan, so you can choose the package that best fits you and your needs.
