A property investor’s job is far from done after signing the paperwork to purchase a rental property. Indeed, it has only begun. The next step is successful property management, which ensures that a landlord generates an income from owning a rental home.
Property management requires time and money, so landlords cannot put aside all the proceeds of their rental income as a profit. Some money must be plowed back into the property to keep it in good condition. Additionally, many hours go into ensuring that property management tasks are fulfilled. Here are tips for managing a property and making it profitable:
Hiring professionals
Landlords who own many properties, live far away from their rental homes or have too many other work commitments look for property management companies to handle the responsibilities on their behalf. Local Chattanooga property managers like Evernest, Kent Property Management, LLC., and Generation Property Management provide top-class services to relieve landlords of their property management burden. A rental property owner’s alternative is hiring one of the larger property management firms, such as Pinnacle Property Management Services or Bozzuto. Evernest has established itself as one of Tennessee’s top residential property management companies, with offices in Chattanooga, Murfreesboro, Memphis, and Nashville. It also operates in other states, including Ohio and Mississippi.
Professional property management agents have the industry expertise to manage all aspects of rental property ownership, including marketing, tenant screening, rent collection, and repairs and maintenance. However, firms do not necessarily offer every service, and landlords should investigate their options before committing to a property management company.
Managing repairs and maintenance
Minor repairs and maintenance are part and parcel of property ownership. However, neglecting them could lead to significant issues that cost a fortune and might see landlords unable to have tenants occupying their rental home while such matters are being attended to. When it comes to being a landlord, a stitch in time truly saves nine. Staying on top of repairs and maintenance is essential for ensuring a rental home remains in demand from prospective tenants and allows a landlord to rent it at higher rates.
Property agents establish a network of Chattanooga contractors who perform routine maintenance and repairs. These companies are vetted to ensure they are the best at what they do and charge reasonable prices. Independent landlords should also form such networks to have contacts when they need assistance.
Minimizing tenant turnover
The last thing a landlord wants is substantial tenant turnover and having their home become a revolving door of new tenants. It is disruptive and can affect a rental house owner’s income stream as the house may stand empty while they look for new renters. Every Chattanooga landlord’s ideal tenant moves in, stays long-term, pays their rent on time, and does not cause unwarranted damage or trouble.
Landlords who find such tenants work hard to keep them as they present stable revenues. They do this by ensuring that they respond promptly to tenant repair reports, keep the house well-maintained, and respect their renters’ privacy.
Ensuring legal compliance
Rental homes are best managed when all affected parties adhere to legal requirements. Understanding landlord-tenant regulations results in a well-defined, harmonious rental relationship. It prevents mistakes and disputes that could lead to lawsuits and lengthy court battles.
Landlords should be mindful of the Fair Housing Act, which prohibits discrimination against potential tenants based on race, religion, gender, national origin, family status, or disability. Legally binding rental agreements are the cornerstone of sound rental property management and must comply with federal, state, and Chattanooga’s local laws. It should cover both parties’ rights and responsibilities and stipulate a rental amount, agreement duration, and the consequences of non-payment or other disputes that may arise.
Filing accurate tax returns
Property investors who earn a rental income must disclose the details in their annual tax returns. It is to their advantage as they can claim several deductions for operating a rental business and property depreciation. Experienced landlords recommend hiring a tax specialist to complete their annual returns to maximize their rebate claims without raising red flags with authorities that would lead to an audit.
Another tax aspect to consider is property taxes. Property owners remain responsible for these amounts and must remain in good standing with authorities by paying them in full and on time.
Insure your property
There are a few reasons why it’s crucial to insure your investment properties. One of the main reasons is that if something happens to the property, you will recoup some of your losses. Another reason is that if something happens to one of your tenants, you will be able to cover their rent while unable to do so. Finally, having insurance on your investment properties can also help you attract new tenants in the event of a disaster. Having this type of security can make potential tenants feel more comfortable renting from you, knowing that their safety and security are considered. Overall, insurance on your house is a wise decision that can save you money and headaches in the long run.