The next step after buying a real estate property for income is to decide who will conduct the property management. As the owner, you must deal with legal formalities, regular maintenance, repairs, accounts management, etc. Despite being a source of passive income, it takes a lot of effort and time.
There are two ways to manage rental properties:
- DIY (do it yourself)- the landlord handles all property management issues
- Outsource- the owner hires a property management company
Read on to explore the ins and outs of investment property management. This is a concise guide for landlords who want to go the DIY route to manage their real estate assets.
Investment Property Management- Roles & Responsibilities of the Owner
The roles and responsibilities in investment property management can be grouped into 3 main categories. Herein is a synopsis of different types of rental property management:
Efficient property management proves a prime factor in bringing in prospective tenants and profitable income. Your job starts from day one, encompassing the following aspects:
- Convert the simple residential/commercial property into a usable environment for the occupants
- Strengthen security in and around the house or otherwise for optimal protection
- Periodical monitoring and cleaning of the premises
- Conduct regular maintenance and repairs (when needed)
This is the most arduous task in the entire process involving legal procedures, managing tenancy disputes, dealing with non-paying renters, and more. Starting from scratch, you will be performing the following tasks:
- Marketing the rental property
- Set prices
- Prepare the vacant flat/apartment before move-in
- Offer rental property tours to visitors
- Prepare the lease agreement
- Handle tenant complaints
- Collect rent
If this seems too overwhelming, you can hire experienced professionals for tenancy management in Bangalore.
Accounts and Finance Management
A rental property owner has to maintain all financial records to avoid problems with taxes and legal matters. It is necessary to keep a record of earnings (security deposit, rent, other charges), expenses (repairs, maintenance, utilities, property taxes, landlord insurance, etc.), and other details in the financial statements. You need efficient rental accounting software to maintain all financial records of your income property.
Tips to Manage Your Investment Property
If you want to manage your rental property yourself, herein is a short guide to getting started:
- Set Reasonable Rent Price
While fixing the rent amount, quote a rate per se for the prices in the regional rental market. With a low rent price, you will suffer losses covering the associated costs. Look into the following aspects when setting the rent price:
- The average rent of similar properties in your area
- Renter demographics
- Average per capita and household income in your region
- Your expenses on property amenities, maintenance, etc.
- Advertise Your Vacant Property
DIY landlords mostly place ads with popular online rental listings and local newspapers. Some property websites also offer tenant screening services. Post a video of the rental property to boost views.
- Schedule Regular Maintenance
If you are a DIY landlord, these repair and maintenance best practices can lower the costs:
- Do an inspection every 6 months on occupied properties.
- Perform an inspection inside and outside the house so that you do not miss anything. It helps to detect damages early.
- Respond to maintenance requests from tenants as early as possible. Delaying the maintenance/repair process will only complicate the project and raise your expenses.
- Hire licensed contractors with a decent track record
- Collect the Full Rent on Time
To make a profitable regular income, you must collect the monthly rental on time. Late payments may interfere with your financial goals. Many tenants set up automated online payments to avoid unnecessary delays. For safety, include a clause for late payment fees in the lease.
- Follow the Legal Regulations for Hassle-Free Tenant Eviction
If the occupant does not pay the rent, you may file an eviction lawsuit. The expenses may vary depending on the lawyer’s fees and other costs. But it is always mandatory to follow the appropriate law and order during the process.
Please read our article on tenant eviction rules in India.
- Store all Vital Documents and Accounting Details
You will need the legal documents and account information in the future for filing tax returns, paying property taxes, etc. Using rental property software offers storage for all such details securely, and generate financial reports, tax reports, and more.
Do you need help with rental property management?
Contact SANGAU, a reliable firm for rental property management in Bangalore. We offer tenancy management services, NRI property management, and more.