Managing a rental property is a task that you can definitely do on your own and being your own property manager can lower the expenses that would otherwise cut into your rental income. However, managing your own rentals will inevitably come with challenges.
One of the ways you can minimize these challenges is to surround yourself with a team of professionals to support you in the more complex areas of property management that you may not have the background to handle on your own. Whether you are simply renting out a home that you were unable to sell or managing several investment properties I would highly recommend that you establish a relationship with a knowledgeable real estate attorney and a good contractor at the least.
We have leaned on our attorney for everything from creating legal documents to advising us about property management laws in our area and his advice has saved us much more than it ever cost us! By now you may be thinking…attorneys are expensive…I can buy property management documents online…I don’t need legal advice. Maybe your right, you may never need a legal professional but I guarantee that if a situation arises where you do, you will wish you didn’t have the 19.99 lease agreement you bought from your office supply store that you assumed covered everything you needed. I will share with you a few situations that we have experienced where good legal advice came in handy.
- Tenant stops paying rent: This may sound like a simple one, but there are very specific guidelines on the proper way to evict a tenant and if you do not follow those guidelines you may end up with tenants living in your home on your dime longer than they ever should have.
- Tenant pays partial rent
- Tenant vacates a property and leaves more damage than what the security deposit will cover
- Tenant has pets in the property that were not approved
- Handling garnishments of evicted tenant’s wages
- Creation of lease agreements, pay or quit notices, and partial payment notices
- Handling closings for new investment properties
- Going to court on your behalf to request judgment for amounts owed
- Creating lease purchase agreements
- Establishing an LLC.
Having a good contractor is almost equally important. There will of course be repairs and upgrades that will have to be done on your property from time to time. Having a good go to contractor/handyman is more valuable than I can even say. When we get phone calls from tenants about over flowing toilets, AC units not cooling, back doors not sliding, garbage disposals not working and every other repair you can imagine it is a huge time saver to already have a relationship with someone who can get the job done with no more effort than a quick phone call on our part. The other little secret that has saved us thousands on repairs is home warranties. If you are not familiar with those I will discuss them later as well.