OK … you’re a seasoned single-family home investor … or seriously considering to be one. If you are the former, you know that once the property is acquired, the real work begins – managing your investment to maximize your ROI. There is a lesson for first time landlords as well. Recognize that your management responsibilities include:
- Leasing & Marketing
So, what to do? Your options boil down to two, or a combination depending on your time and talents.
- hire a professional property management firm, or
Note: The hallmark of KRS Holdings is based on the above four cornerstones.
- DIY (do it yourself).
Caution! Don’t make any spur-of-the-moment decisions until you’ve taken an objective assessment of your experience, abilities and participation preferences. As promised, what follows is our SFH Landlord Quiz to help you evaluate your alternatives.
Be candid with yourself as you answer each of the five questions and score them on a scale of 1 to 5 … with 5 being the best rating.
- What experience do you have in managing residential rental property?
- Do you prefer to be a passive investor or a hands-on landlord?
- How far away are your investment properties from your residence?
- Assuming you are considering DIY, can you effectively service all your properties?
- Are your rental payments sufficient to pay a property manager?
What experience do you have in managing residential rental property?
DIY and “learn as you go” is a perfect formula for disaster in protecting and enhancing your investment. If your know-how is limited to paying your own rent or mortgage each month, score yourself as a 1 on this issue.
Do you prefer to be a passive investor or a hands-on landlord?
There are several issues to consider in this regard.
- Do you have a great need to remain in control of all aspects of your investment?
- A hands-on landlord also becomes heir to the stress factors of tenant-management. How willing or emotionally able are you to deal with complaints, maintenance and non-compliance with lease obligations? These are often face-to-face and confrontational.
- Hands-on management means dealing with internal or contract resources for maintenance and repairs. Do you want to take on the people-supervision?
How far away are your investment properties from your residence?
DIY and distance are deadly housemates. Responding to emergencies, maintenance, rent collection and vacancies is severely impacted and often impaired.
Assuming you are considering DIY, can you effectively service all your properties?
Do you have time to effectively manage your properties? Lack of time to devote to the needs of your tenants and property maintenance will have a severe adverse effect on the success of your investment.
Will your rental revenue support the cost of a property manager?
Property managers do not work for free. Are your rent receipts adequate to afford a property manager, cover other overheads and yield a profit … or at least render your venture break-even?
Now review how you scored your SFH Landlord Quiz. Only you can evaluate whether you can “go-it-alone”. Alternatively, it may be your judgment to seek assistance from a professional property manager … or at least evaluate that path as a possibility.
Remember! While your options boil down to two … DIY or hire a professional property management firm … you may choose a blended combination depending on your budget, time and talents. “Mix-and-match” is a preferred route for many single-family home investors.
OK. Let’s say your appraisal of your Quiz scores guides you to explore the benefits of enlisting the aid of professional management. That will be the topic of the second of the two articles in this series. In our next issue we’ll detail what to look for and questions to ask of property management candidates. That will be the foundation for:
Your Performance Expectations
Property managers’ primary responsibilities are to keep residential rental investors and their tenants happy. That means satisfaction by both parties in the condition of the rental unit, the grounds and maintenance services. While the manager works for the owner, the needs of the tenant are paramount to retain quality, long-term, profitable renters.
Additional services often provided by property management firms include advertising, leases, tenant disputes, collection of rents and evictions. KRS Holdings is here to help you with all these needs.
Can’t Wait for Next Issue?!
Give us a call or drop an email. We’ll respond promptly and
relieve your stress to evaluate your property management options.