How to Manage Multiple Properties Like a Pro
Managing multiple rental properties can yield substantial financial rewards. In fact, the average annual return on investment for a single rental property is over 9%.
There is upside to this average, with ROI potential up to 19%. Despite the financial perks, managing rental properties is sometimes a struggle.
Rental property management can be time-consuming and stressful. Multiple properties only add to the workload.
The good news is that there are tips and tools to help you manage multiple properties. As a result, you will get more efficient and increase earnings potential.
Read on for a guide to managing multiple rental properties in the most efficient manner.
Select High-Quality Tenants
The key to securing the best return on investment is a steady stream of revenue. This means selecting tenants that are creditworthy and pay the rent on time.
There are a couple of ways to ensure that you select high-quality tenants. For starters, run the applicant’s credit history and check for timely payments. A trend of multiple missed payments raises a serious red flag.
Another tip is to ask the applicant for references. Do not settle for personal reference, but rather, ask to be referred to previous landlords. This way, you can get a detailed rental history for the applicant.
Lastly, verify that the applicant’s income is sufficient to pay the monthly rent. Ask the applicant to provide two recent pay stubs and a W-2 form.
Emphasize Preventative Maintenance on Your Multiple Properties
The best way to attract great tenants is to offer great properties. In order to do so, you must keep up with the maintenance on each property.
One good suggestion is to enter maintenance contracts with reputable service men. For instance, hire a plumber to service the hot water heater at all your properties.
Preventative maintenance improves your bottom line in the long run. In addition, it keeps your tenants happy as appliances are operational and in good condition.
Consider Hiring a Property Manager
If the workload to manage several properties becomes too burdensome, hire a property manager to help. A property manager keeps up with the maintenance and collects rental payments.
However, you must take into consideration the cost of hiring a property manager. This addition increases your operating costs and reduces your profit margin.
On the other hand, hiring a property manager may free you up to invest in more properties.
Use Mobile Tools to Optimize Management
There are great mobile apps available to make your life easier. Software tools provide a centralized point for accounting and tenant management.
These apps provide a means to communicate with tenants and schedule appointments. Some apps can pull applicant credit history and background checks.
Wrapping It Up
Managing rental properties is a tough but rewarding business. The key to achieving your ROI objectives is selecting reliable tenants. Placing an emphasis on property upkeep is also beneficial.
Opting to use software apps or a property manager reduces workload and stress. For more information on managing multiple properties, please contact us for assistance.