So You Want to Manage Your Rentals?
I have been receiving a lot of questions about managing your own rental properties. However, as many of you know, I hired a property manager immediately, and have never actually managed my own properties.
My good friend Dave—not me, another Dave—helped me write an article for my friend's website the other day. His outline was so good that I asked him to expound upon it to get this information out to our community as well!
Dave is the man when it comes to managing rental properties. He has managed properties in both San Diego, California, and Jacksonville, North Carolina for several years—and never had a unit vacant for more than two weeks in that entire time!
I have learned a ton about property management from him, and I’m excited to be able to share this with you now.
Here are the things you need to keep in mind when you decide to manage your rentals yourself.
Gaining interest in your property
A lot can be said about this topic, but the main area you can separate yourself from property management companies is filling vacancies fast. However, filling a vacancy starts with generating interest.
- Marketing: One way I do this is mass marketing my properties. Zillow, Trulia, Hot Pads, Realtor, Facebook Marketplace, Craigslist, Instagram, and word of mouth are some of the outlets I use when advertising my properties.
b: Photos for your listing: Get professional photos done. If you can afford to have the property staged, do that too. Finally, ensure the photos are organized in such a way that it mimics as if the applicant was walking through the property. Meaning, the first picture should be the front of the property, the next picture should be as if you just opened the door, etc.
c: Text for your listing: You want to cut down on many of the common questions which will get asked over and over, so I make sure my listing is very detailed and specific and answers all the common questions, such as basic requirements to move in, lease length and price per month, rules on pets, credit requirements, etc.
d: Responsiveness: Keep in mind, yours is not the only property the applicant is researching. They have more than likely cast a wide net and contacted all the properties which fit their criteria, including yours. Responsiveness is key. Do NOT put off answering questions via text or phone call. You will quickly jump to the top of their list by being so responsive.
Once You Have Applicants In Your “Pipeline”
Once you have people applying to rent your property, you need to walk them through a pipeline to handle: applications, walkthroughs, signing leases and facilitating payments.
a: Apply: Most applicants are going to want to walk through the property before filling out an application. Never allow this. Why would you allow someone to walk through your property when they might not even meet the minimum qualifications to live there? There are plenty of websites where they can submit their application. You will then review the application and either cut them or send them through the next step of the pipeline, the walkthrough.
b: Walkthrough: After the applicant’s application has been accepted, schedule a walkthrough. This is when you will enlist the help of your “person on the ground” (see step 4). After the walkthrough, provided the applicant likes what they see, they will move on to signing the lease.
c: Lease: At this point, you will send the lease to the applicant to sign and send back. Ensure your lease will hold up as a legal document. Seek assistance from an attorney if you do not already have a lease. Once the lease is signed by the applicant, you will sign it and send it back to them. They are now ready for the final step in the pipeline to move in, payment.
d: Payment: At a minimum, you will want to collect the first month’s rent and security deposit. Usually, a security deposit is equal to one month’s rent.
Now that you have found your ideal tenant, is it time for them to move in?
a: “Welcome home” letter: A good idea is to have a “welcoming” letter of sorts, e-mailed to your tenants before they move in. At a minimum, the letter should inform tenants where the nearest schools, supermarkets, and similar amenities are. Additionally, the letter should have all the phone numbers to the utility companies, and if you know, any specific requirements the individual utility companies require to start service.
b: Move in/ Move out the form: Within 10-14 days of occupying the property, your tenant needs to go a full walkthrough of the property and send the move in/ move out the form to you. You will have your “person on the ground” use this same form when the tenants move out to ascertain what repairs they will be fiscally responsible for.
c: Collecting rent: Whatever method by which you decide to collect rent, ensure that you communicate it with your tenant and they have the ability to pay via that method. Again, there are third-party companies that can collect the rent for you, or you can apply to do so. Further still, you can have them transfer rent from their bank to yours each month.
d: Maintenance: During the time you lived on your property, you should have already built a network of maintenance personnel in various vocations. These will be the individuals you call when you are managing your property from afar and get a call about a maintenance issue. If there is an area of maintenance (say, plumbing) that you had not used, you can always seek reference or look at online review websites.
The person on the ground
Although you can 99% effectively manage your rentals from afar, some things need to be done in person. This includes conducting walkthroughs with applicants and conducting a final walkthrough when the tenants move out. You should have a couple of people local to the town your rental property is in who you trust to carry out these tasks. They can be friends, family, or even the agent you used to buy your property in the first place. When conducting walkthroughs with applicants, they should know enough about your property to field questions about it. Similarly, when conducting the final walkthrough, they should have the move-in / move-out form in hand and have a good eye for spotting damage.
It's That Easy to Manage Your Rentals!
Didn’t he do an incredible job of making property management appear simple? Another great resource for managing your own rental properties is The Book On Managing Rental Properties by Brandon and Heather Turner.
If you want to learn more about managing your own rentals, you can reach out to Dave directly at: