Leasing your property is an excellent way to establish a long-term source of income - especially since the value of your property will most likely increase as the years go by, allowing for an even bigger ROI (return on investment).
However, leasing your property isn't as easy as just throwing up a for rent sign in the front yard. In fact, it takes a lot of time and work to not just rent out your property, but to get it ready to rent. Not to mention all of the responsibilities you'll have during the course of a lease.
Activities for Leasing Your Property
The following are the things you'll have to do if undertaking property management on your own:
- Preparing your rental property- You'll need to invest in repairs if they're needed, whether it's broken shingles on the roof or faulty plumbing in the bathroom. There are two reasons why you need to do this:
1. First, ignoring necessary repairs could risk the safety of your residents.
2. Second, few residents will want to move into a home with any problems that could affect their comfort or convenience.
Additionally, you may want to invest in improvements so that you have a better chance of attracting potential residents as well as possibly make more on rent.
- Determining the value of the property- The last thing you want to do is undercharge to the point where you end up losing money on your rental property. But overcharging is a bad idea as well since it will make it much more difficult to find potential residents. You will need to get a rental property evaluation before you can begin marketing your rental property.
- Marketing your rental property - Knowing how to market your property and where isn't something too many homeowners are familiar with. You'll need to write up information about the property, take photographs, post ads in numerous places and more.
- Meeting with potential residents - You will need to show the property to numerous potential residents, and once you find potential residents that are interested, you'll need to screen them properly to make sure that they are financially capable and responsible to make monthly rent payments on time - and to keep your property in good shape.
- Paperwork - You'll need to prepare a lease that contains all of the terms discussed between you and the residents. Accidentally leaving out important information can cost you a lot of money. For example, if there's nothing in the lease about subleasing or the number of residents that are allowed to live on the property, then your resident may end up renting out each room to a large family without having broken the lease agreement.
- Maintenance and repair services - You will be responsible for all maintenance and repair services. If something goes wrong or any part of the property is damaged, the residents will expect you to have it fixed as soon as possible. It's part of what they are paying for. In order to prevent breakdowns and damage from occurring, you'll have to perform regular maintenance; for example, scheduling yearly tune-ups of the HVAC system.
- Accounting - Leasing a property requires you to keep track of a lot of accounting information, including all of the money going into the property - such as maintenance and repair services, property taxes and the like, as well as keeping track of all of your rental payments. This might not seem too difficult with one rental property - but if you have more than one rental property, it can become quite overwhelming.
- Rent and fee collection - You will be in charge of collecting rent and any fees charged for late payments or fines for other terms that may have been broken by your residents. This can a very stressful task, especially if your residents continue to be delinquent in their payments or simply refuse to pay, in which case you will need to take legal action.
- Move outs and evictions - Once someone has decided to move out, you'll have to go through a walk through to determine whether your residents get their deposit back. You'll also have to do basic repairs and maintenance before you can put the property back up for rent. If you have to forcibly remove a resident, then you'll need to go through an entire eviction process.
Tackling The List
It's a lot of work - and it begins all over again once someone moves out of your rental property.
For many, the hassle may not be worth the effort; however, by working with a qualified company that specializes in rental property management San Diego these responsibilities will be taken care of for you.