dealing with tenants

If you are not going to hire a property manager to handle your real estate investments, you will be taking on a lot of responsibility. And one of the biggest responsibilities is dealing with tenants. This may not be something that you think about early on when you are buying a property, but soon enough you will be faced with this situation.

When it comes to dealing with tenants, you never know what type of situation you are going to run into. There are a few common occurrences that most landlords are used to, but as you can imagine, this industry is one that never stays the same. No matter how comfortable you are with your tenants, you never know when this is going to change in the future.

Here are three common things that you will be dealing with as far as your tenants are concerned.

1. Since your tenants are paying rent, they are going to expect everything to be in good working order. If nothing ever breaks you will not have to worry about this. But guess what? The second that something goes wrong is when you will get an immediate call from your tenant. If you know what you are doing, you may be able to fix the problem on your own. But in many cases, this is something that you will have to pay for. Just make sure that you are ready to deal with this from time to time.

2. Rent is another huge sticking point when it comes to landlord – tenant relationships. The lease that your tenants sign will outline how much money they are supposed to pay as well as when they are supposed to send it to you. But as you can guess, this does not always work out easily. There are going to be times when you are less of a landlord and more of a collection agency. This can be annoying, but remember, it comes along with the territory. If you do your research before letting a tenant move in, you should be able to avoid people who are not going to pay you what they owe on time.

3. Even though you may hate to think about it, some tenants will try to take you to court if something goes wrong. This is far from common, but often times small disputes can lead to larger issues that can only be settled in court. You will want to do whatever you can to keep your tenants happy at all times. This does not mean that you should let them push you around, but a mutually beneficial relationship is very important. This will help to ensure that your problems never go beyond anything minor.

You should not let dealing with bad tenants scare you away from getting involved with investing in single family homes. When it comes down to it, most of the tenants that you lease your property to will end up working with you just fine. But of course, there are always times when this does not happen.

The way that you deal with tenants will have a lot to do with how successful your real estate properties become. Once you have one investment property in the pipeline, you will begin to gain experience with tenant relations. From there, you will not run into any issues that you cannot handle.

Overall, making sure that your tenants are happy is very important. And remember, you want to be happy yourself. When both parties are feeling good about the deal at hand, there should never be too many irresolvable issues.

Setting up a Lease Agreement

Renting out single family homes is a great way to make some extra money. And in many cases, if you have enough properties you can make a good living this way. But before you start renting your homes without a contract in place, you need to think again. Each tenant that you deal with should be required to sign a lease agreement. This will not only help to protect you, but it will do the same for the tenant as well.

Setting up a lease agreement is something that new real estate investors often times have trouble with. After all, this is bit different than most agreements that beginners are used to dealing with. The good thing is that once you settle on one basic lease agreement, you can use it time after time.

When setting up a lease agreement you need to make sure that you have all of your bases covered. Remember, if you make even one mistake it could come back to harm you later on down the line. You would be much better off doing everything right the first time so that you do not have to worry about future problems.

There are many websites that offer basic lease agreements that you can print out, customize, and use with your tenants. If this does not suit your needs, why not look into talking to a lawyer about this? They will be able to draft an agreement for you to use. You may have to pay them for this service, but it will surely be well worth the time in the long run.
Once you have your lease agreement in place, the next step is to present it to potential tenants. In many cases you may need to make some changes here and there. Just because you think that your lease agreement is perfect does not mean that the tenant will like every last detail. But before you go ahead and change just anything, make sure that you know what you are doing. After all, if you plan on making changes on the fly, what was the point in having a professionally written lease agreement in the first place?

As you can imagine, you will want to make sure that the lease agreement suits the needs of both you and the tenant. If you attempt to force them into something that they do not want to do, you are just going to make problems for yourself in the long run. And of course, if you make too many changes to suit the needs of the tenant, this could once again cause issues. Your main goal should be to draft a mutually agreed upon lease agreement.

Customizable fields in any lease agreement include things such as the length of the lease, utilities that need to be paid, price, etc. This is all based on the type of property that you are renting, what you are trying to accomplish, and what you and the tenant are comfortable with.

Overall, setting up a lease agreement is one of the most important aspects of investing in homes to rent out. If you skimp in this area you are tempting the real estate gods. Instead, put together a solid lease agreement from day one, and use this time and time again as you rent out your properties. Even though you will have to make changes along the way, once you have a basic format in place, you will never again have to stress out over this. And as you can imagine, keeping stress and potential problems to a minimum is very important when it comes to real estate investing.

Finding and Hiring a Qualified Property Manager

If you need to hire a property manager it probably means that you are doing quite well with your real estate investment business. And if you want to continue with this success, you need to make sure that you hire a qualified property manager. After all, there is nothing worse than working with somebody who is not trying to achieve the same goals as you. Luckily, most property managers are more than capable of doing a great job. You just need to make sure that you get in touch with one who is going to work with you to achieve success.

Here are a few tips that you should consider if you are interested in hiring a property manager.

1. You need to hire a property manager who shares the same goals as you. If you are attempting to do one thing, while your property manager another, you are going to conflict more times than not. This is something that you should discuss with potential managers before you ever hire one. It is very important to clearly outline your goals, and then make sure that your property manager is willing to work with you in order to meet them.

2. No matter where you live, you should be able to find plenty of available property managers in your area. In fact, many big cities have an abundance of these professionals. After all, the real estate industry is one that is growing quickly. This is not to say that it will always be hot, but as of right now, there are plenty of people who are hoping to get involved. Additionally, you may be able to find a property management company that will be easier to work with. In many cases, hiring a company is much better than a single person.

3. Just like with your tenants, you need to have an agreement in place with your property manager or management company. In other words, you need to know what they are going to do for you, and they should know what to expect at the same time.

4. Talk to several property managers before you hire one. Going through an interview process with each one is the only way to ensure that you make the right hiring decision in the end.

5. Payment is something to consider when hiring a property manager. Even though you will find that there is an industry average, some property managers may ask for more, whereas others will do the job for less. Make sure you know your budget as well as what the going rate is. Once again, the only way that you can do this is through properly communicating during the interview process.

The five tips above will help you when trying to find a property manager. Additionally, you should be able to use these tips to hire the right person for the job as well. This is a very important decision to make if you are getting involved in the real estate investment industry. If you end up hiring the wrong property manager, it is safe to say that you have caused extra work for yourself. Not to mention the fact that you will probably lose some money along the way as well.

Overall, if you need to hire a property manager, do whatever it takes to make the right decision the first time. This will allow you to rest easy, and know that your rental properties are in good hands.

Do You need a property Manager ?

Do you need a property manager? This is a question that a lot of new real estate investors struggle with. While there are some people who think that a property manager is a necessity, others will tell you that this is nothing more than an added expense. The fact of the matter is that you need to make this decision on your own. It is up to you to decide whether or not hiring a property manager would help your situation, or do nothing more than get in your way. Either way, you need to make your mind up on this as soon as possible.

In most cases, the investors who need a property manager are the ones who own more than one property. After all, trying to keep all of your investment homes organized can be difficult to do. But with the help of a property manager you will always have somebody on your side to lend some assistance.

Of course, even if you only have a couple of rentals you can still hire a property manager to work on your behalf. But remember, you will have to pay him or her to do the work for you. This means that your profits are going to be cut into before you know it. To some people this is well worth the money because it saves them from having to deal with the day to day grind of staying up to date with investment properties.

So what are some of the things that a property manager can do for you? All in all, their main goal is to manage your property on a daily basis. Managing real estate means doing everything from collecting rent to answering questions about repairs and maintenance. Are these things that you would rather not handle on your own? If so, it is time for you to consider hiring a property manager. For the most part, you can tell them what you need done, and if you find the right person they can help you out with every last task that comes up.

A property manager can also be a major asset if you are thinking about expanding your portfolio of real estate properties. Remember, as you buy more and more homes your workload is going to increase. So even if you are handling one or two homes just fine, if this number increases to three or four you may begin to slow down quite a bit. This is when a property manager can move in and really take over all of the day to day tasks that have been holding you back.

Finally, an experienced property manager can also help you with any questions that you may have. And as a new real estate investor this is very important. When you hire somebody who has been around the industry for a while, it is safe to say that they have seen just about everything. Not only will this help you, but it will do the same for your tenants. For this reason, you need to hire a property manager that knows a bit about the area you are located in.

Overall, the decision to hire a property manager is up to you. If you are getting along fine without one, you may want to keep things this way for the time being. But if you are struggling to keep up with all of your work, what is the point in waiting? You would be much better off hiring a property manager that knows what they are doing. You will have to pay them for the services that they offer, but it will go a long way in helping to keep all of your properties organized. And when you are organized it is safe to say that you are going to have a better chance of growing your investment business in the future.

The First Weekend

Buying an investment property can be a lot of fun. After all, this is not only a great way to spend your time, but it can earn you some money as well. But before you start your search for tenants, you are going to have to get your property up to par. When it comes down to it, the real estate market is quite competitive. To beat out the competition you need to make sure that your property has more to offer than the rest.

To get started moving in the right direction, you need to use the first weekend in the home to your advantage. Remember, the more time that you waste, the more time it is going to take for you to see a profit. And since you have another job to tend to during the week, the weekends are when you need to make your hay. Unfortunately, many investors slack off during this time, and find that they are way behind schedule.

There are many things that you can do the first weekend in a new investment property. Once you have a plan in hand, which you should have put together on day one, you will be ready to go.
Arrive at the home early Saturday morning so that you have the entire day to get to work. If you are going to be doing any major renovations, these are what you need to take care of before anything else. This means that you should complete all demolition before you start with repairs. Remember, demolition can make a huge mess. If you fix something before you demo something else, it is safe to say that you may undo all of your hard work.

As you continue to work throughout the weekend, take the time to update your to do list along the way. This will help to make sure that you do not duplicate any tasks, or waste any unnecessary time.

By the time Sunday rolls around you should have a much better idea of where you stand. If you can take care of the demolition process on Saturday, the end of the weekend is when you can start making repairs. As a general rule of thumb, you should never start a large project that needs done in one day unless you have the time for it. Many new investors start big projects on the first weekend in the home, but end up running out of time before the work week begins. This can lead to a lot of lost work, or worse yet, having to work the wee hours of the morning. You want to avoid this because you do not want your investment home to get in the way of your actual nine to five job.

Once the first weekend is over, you will have an idea of what you have gotten yourself into. Hopefully you will have realized that you have a real gem on your hands, and that you are nowhere close to being in over your head. But remember, it is natural to feel a bit overwhelmed once you begin to work on an investment property. You may feel anxious to get things done, or in many cases you may start to second guess yourself. As long as you keep on schedule you should never begin to feel overly stressed.

Overall, the first weekend in an investment home is one of the most important. This is when you will decide whether or not you are going to get off to a good start. When you begin to move in the proper direction from the first weekend, you will have a much better feel for the job as you move forward.

The First Day

So you have invested in a home? You are ready to turn it into a money making machine by renting it out to tenants, right? If this sounds like you, the first day that you have access to your property can be a difficult one. After all, you need to make a decision on what you are going to do first. And this is not always easy to do since every piece of real estate is different.

The first thing that you need to do is decide on what type of home you have on your hands. In other words, are you going to have to make a lot of repairs? Or should you be able to get by with a few minor fix ups here and there? Believe it or not, the condition of your property will sway the direction that you take on the first day that you open the door.

If you are faced with a fixer upper, you will want to draw up a plan for getting the job done as quickly as possible. In fact, this is a great way to spend your first day. Instead of diving right in and hoping that you get everything right, have a plan that will give you direction starting from the first day. This way you do not find yourself completing jobs out of order, and in turn making more work for in the long run.

On the other side of things, if the home you purchased is in good condition, the first day may be chalked full of minor fixes to get it market ready. Once again you should take the time to make a list, but it will not be nearly as long as a “fixer upper” list. Now that you know what you need to do, you can then get started.

Many people like to dive right into things on day one without ever making a plan. Do you know what this leads to? A few days later they have found out that they missed something, and the backtracking begins. All in all, when you rush ahead on day one you may be making more work for yourself in the end. With a good plan in mind, the first day in your investment home should not be full of stress, but instead full of preparing for the work to come.

Your Down Payment

Buying any type of real estate means that money will be transferring hands. But as you probably know, the amount of money that you pay for a home will vary. Not only will you negotiate down the listing price of a home, but adding a down payment will also change things quite a bit. There are many details that you need to keep in mind when you are dealing with the down payment on an investment property. Here are three of the most important.

1. You do not always have to put money down on a home that you are buying. There are many lenders who will be more than willing to loan you 100 percent of the purchase price. Of course, you usually need great credit in order to get this kind of treatment from a lender. Keep in mind that if you do not put down at least 20 percent you will have to pay private mortgage insurance. As an investor, this is an expense that will cut into the profits that you are set to make each month.

2. Generally speaking, the more money that you can get together for a down payment the better. What is the reasoning behind this, you may ask? Simply put, when you have a large down payment the amount of debt is going to be much less. In turn, this means that you will begin to turn a profit sooner rather than later. Additionally, a down payment will put you in a much safer position in the long run.

3. A down payment will help to lower the cost of your monthly mortgage payment. When you do this, you will then be able to profit more on the rent that you charge. With a large down payment the amount of profits that you make on rent will be much more substantial.

As you can see, you do not necessarily have to put any money down when buying a real estate investment property. But all in all, this is probably in your best interest. After all, you can better your situation and potential profits by using a down payment. Even if you only have a few thousand dollars, this is usually better than nothing.