Managing Rental Properties
I'm strongly considering keeping the property that I'm repairing as a rental. I've never had rental property, know very little about it and would like to learn about being an effective landlord and avoiding, or at least minimizing my hassles with all the various issues that can come up.
Where and how do I educate myself? Any particular books, websites etc that are recommended? What should I search for on this website? Any words on mindset? Warnings? Prayers? Anything will be appreciated. Thanks!
Let me recommend that you have a management company manage the property. Stay with what you do best. Sure it will cost some of your profit but you will not have to take 3:00 a.m. calls that the a/c is not working.
A good question to post here:
What do management companies usally charge? I've heard as low as 8% of rent, and even as high as 15% of rent.
What is a fair rate?
JB
Regarding having a management company handle the property, I'm open to that idea. What do I look for in a management company? What questions to ask etc? Thanks again!
Finding a good PM; what I have been told:
Interview + referrals. Listen to the property managment company and learn their philosophy. Then try to teach them your's; if you are convinced you are of the same accord... see step 2.
Ask to see a unit or house being prepared for new tenants, ask to see ads they have placed. Then, talk to some tenants they have; how are they treated when things break?
Don't just go with a referral; your source may not have your philosophy.
this info is from a 6-tape series published by the Kyosaki crew at Rich Dad, Poor Dad. Gotta love driving neighborhoods and feeding your brain at the same time.
Also, read "Managing Rental Properties for Maximum Profit," Revised 3rd Edition
by Greg Perry
Good luck!
Wow, I have 33 units and I don't use a property management company. Why give up the profit. I've never had one of those 3 am calls. Had a few eviction nightmares but nothing major, only things that cost money. The best resource i know is Mr Landlord. com. I do have a maintenance guy. I figure him into anything that i buy. If you are going to use a rehab as a rental, my one piece of advise is to not use top shelf stuff in the house, that way you are not as upset if/when something gets damaged. Some bumps on the way, but remember... they are paying off your house for you, plus a little profit each month.
Good Luck,
Shawn(OH)
How are you going to know if they're managing the property well if you know nothing about property management??? From my personal experience and indirect experience with other landlords, it seems that about 90% of propertymanagement companies fall somewhere between bad and terrible, especially when it comes to properties with fewer than about 50 units.
I'd buy the book "landlording" by leigh robninson and do it yourself for a year. If after a year you want out, you'll be more able to shop for a decent management company. Just my 2 bits.
I personally prefer using a management company. They don't charge much at all for what they do in my experience, maybe 6% to 8% usually, but it varies by locality. I don't have to collect rents(can be very time consuming) , look for tenants when units are going to be vacant, take calls for all the various reasons that tenants call(not just for repairs ), follow up on tenants who are late, make all the calls related to finding someone to fix a problem and then all the followup with the tenant and repairman that's required, property inspections, recordkeeping, etc., etc.,etc. Mostly I just deposit my checks each month, and I suppose I could even have that done electronically. Of course, some people just like the management end so there is no need for them to pay someone to do it. Management is actually the only part of real estate investing that I don't enjoy at all.