Multi-Property Management–3 Mistakes to Avoid
Managing multiple properties successfully isn’t easy. You face more significant risks and complexities, but the rewards can potentially be much greater too. In this article, we’ll cover the three essential tips and tactics you need to know in order to successfully manage multiple properties without making costly mistakes.
Not Doing Due Diligence on Tenants
Before you take on a tenant, performing appropriate due diligence is essential. That means carrying out know-your-customer checks to make sure the tenant is who they say they are, verifying their credit score, and checking previous rental histories. For commercial real estate clients, due diligence can mean thoroughly reviewing the business you are considering renting to, reviewing their previous rental history, and understanding the plan for the property. Additionally, it’s important to assess whether or not the applicants, whether residential or commercial, can comfortably afford the rent for your property.
Carrying out these checks can take time and may seem like an unnecessary expense, but it is essential before letting any property. By properly vetting tenants, landlords are making sure that they aren’t placing themselves in a position of financial liability. Some areas require landlords to acquire particular licenses before renting a property. Make sure to check the specific regulations in your area when preparing for tenants.
Not Having a Property Management Plan
Before you invest in multiple properties, it’s essential to have a clear plan in place that covers your rental strategy, income generation, and maintenance. Having this formalized property management plan helps you effectively manage all of your real estate investments under one umbrella. Without a plan in place, you can easily become overwhelmed by the day-to-day demands of managing multiple units and could end up having difficulty keeping them up to date.
It’s important to create a solid financial plan for each property based on rental income and any potential maintenance costs. When it comes to managing multiple properties, you can’t just wing it, or you risk missing out on great opportunities or making costly mistakes. You need to map out your short-term and long-term plans in order to ensure success in the future. Before investing in a new property, take the time to consider how it fits into your desired asset allocation, as well as determine whether your current management abilities will suffice or if you will need additional help.
Property management software designed for multiple residential or commercial properties is essential to having a successful property management plan. This is where UnitConnect can help with customizable solutions for your unique needs.
When it comes to managing multiple properties, neglecting upkeep and minor emergency repairs can be disastrous. Substantial liability issues can also arise from neglecting routine upkeep that is considered standard for the industry. Significant problems like plumbing bursts or electrical fires are likely to arise without routine maintenance, costing you more money in the long run. Make sure you have a budget for regular property maintenance, and get into the habit of scheduling inspections to identify any potential problems before they become too expensive.
Visit UnitConnect to learn more about the cloud-based solutions we provide, including data security, a tenant portal, and automated rental management.