First rental property guidance!

[Paige Seeley]

I'm closing on my first investment property this week! Since this is all new to me, I'm looking for some advice and I had some questions about self-managing the property. 

1. Would you recommend periodic check-ins at the property to assess for upkeep and potential maintenance issues? if so, how often if the tenant has a year lease?

2. Best way to handle maintenance requests from tenants

3. Since I'm only at 1 property right now, bookkeeping should be fairly simple. But any recommendations on a system? 

4. Best way for collecting rent, security deposit, etc. with 1 property. I was thinking of offering Zelle, Venmo, cashier's checks as options- I want to try the inevitable situation of having a personal check bounce.

5. what platform would be recommended for a lease generator? I know bigger pockets offers their own but wasn't sure if anyone had any experience with using those documents and if it's worth the money?

6. I thought about offering a credit towards the utilities and having the tenant cover whatever the remaining monthly utility bill would be as an incentive to hopefully rent this property faster, any thoughts or recommendations on this?

Thanks everyone! 

[Kyle Spearin]

1. How old is the property and the major systems? Without knowing this, I'd probably recommend driving by every once and a while or talk to neighbors to get the scoop. In terms of actually going into the property, I did a check-in at 6 months on my properties, but not sure whether that's too much or too little.

2. I do everything via email. Tenants can't text/call me unless it's an emergency.

3. Quickbooks.

4. Apartments.com is awesome for this.

5. Seems like BP offers good ones and you can always customize them to your liking. Alternatively, you could work with an attorney or real estate agent to help and pay them a flat fee.

6. Personally, I think that could get messy and confusing. I like things cut and dry so there's no opportunity for misinterpretation of who is covering what. You could try setting up a zillow listing and paying like $35 to boost it to get more visibility, post in FB groups, etc. to get it rented faster. And lowering the rent (which no one likes to hear and it sucks) also works if you're worried about vacancy.

[Nathan Gesner]

Quote from @Paige Seeley:

Do yourself a favor: buy "Every Landlord's Legal Guide" by NOLO. Written by attorney investors, it's full of practical advice about the management of investment property, has sample forms that can be edited, and - most importantly - tells you what your primary state laws are and where you can read them. It's updated yearly and is the best $40 you'll spend as a Landlord. There is one book for 49 states and a separate book for California.

Software is a common question on BiggerPockets. Here are some things to consider:

1. Most investors don't need software until they have 5-10 rentals. You only need a place to track tenant information, payment history, maintenance, etc. You can easily do this on a spreadsheet, and it will take less time to track than finding and learning new software. If the software is not simplifying your life or making you more accurate, you shouldn't use it. Go to Etsy and search for "rental property tracker," and you will find hundreds of nice spreadsheets to track 10-20 rentals, usually for under $10.
2. Software has extremely helpful features like online payments, marketing syndication (click a button, and your property is advertised on multiple sites), electronic document review/signing, maintenance tracking, and owner reports. Do you need all this for a couple of rentals?
3. There is no perfect software out there. Every system you try will have flaws, or you may salivate over a feature that appears in other software.

Some familiar names are mentioned frequently: Stessa, Apartments.com, RentRedi, TenantCloud, Innago, RentManager, Avail, Rentec Direct, Doorloop, etc.

I recommend conducting thorough research on each app online to understand their offerings, pricing, etc. Create a simple spreadsheet or written list to compare the features of each and identify the ones that align with your requirements. Try to narrow down your options to the top 3-4. Once you have a shortlist, sign up for an account with each one and test them extensively to see how they function. Perform the same task in each app to ensure a fair comparison.

• Load a property with pictures and details.
• Market that property.
• See what your marketing looks like from the public's perspective.
• Submit a fake application to see how easy the process is.
• Run a credit/screening report on yourself.
• Enter a maintenance request, assign a vendor, and attach a fake invoice.
• Enter charges to the tenant's ledger.
• Enter recurring charges and automatic late fees.
• Sign documents electronically.
• Run owner reports.

After testing a few apps, one should clearly stand out. It's important to choose that one and commit to using it. Remember, no system is perfect, so avoid the temptation of constantly chasing after the next shiny object. You should only consider switching when your current software has a significant flaw or lacks features that force you to spend excessive time on workarounds. At that point, it's worth researching and finding a solution that better meets your needs.

[Bonnie Low]

Hi, Paige. Congratulations on getting your first investment property. That is such an exciting milestone! You're asking all the right questions. I'll try to give you some feedback in the order you asked it.

1) We require a walk through inspection every 6 months for all of our LTRs. This gives us a chance to look for damage and to check for things like sinks under faucets, toilets that run, loose cabinet doors etc. It also gives us a chance to see whether they have any pets that weren't disclosed in the lease - pretty common actually. If that happens we just let them know the lease has to be amended and the pet deposit paid. (unless there's pet damage...that's a different story)

2) Ideally you'll want a property management system that allows tenants to submit maintenance requests through an online portal. It will help keep you organized, streamline your communications about the repair both to the tenant and to whatever trade person you use to do the work and make your bookkeeping related to the repair easy. There are programs like Avail and Stessa that do this and aren't too expensive. 

3) It's tempting to just use a spreadsheet when you have one property but before you know it you have several and it's a pain to switch over to an actual system. I speak from experience! I'm using Baselane now and it's dramatically simplified my bookkeeping. It's a banking & bookkeeping platform, it's free and has a very straightforward user interface. Check it out https://www.baselane.com/

4) See above. I use Baselane for collecting security deposits and rent. I like the payment processing feature that shows you step-by-step where your payment is at.

5) I've used different programs for creating leases but keep going back to Avail. I think it's easy to build, easy to modify and inexpensive to use. Whatever you use, make sure it's state-specific.

6) Putting a cap on utilities is smart, especially when you're starting out and have no idea what they're going to cost you. Be sure to spell out the terms in your lease so there are no surprises. If you're buying a property that is not new construction you  may be able to call the local utility company to find out what the power bill typically runs so you at least have a ballpark figure.

Good luck to you. Hope this was helpful!

[Theresa Harris]

Do check ins every 6 months-check the furnace filter and batteries in the smoke detectors/CO detectors to make sure they are working.  Also get a copy of the local laws for rentals, so you know what you are dealing with.  Some areas also have templates of leases that you can use and modify.

for software with 1 rental-don't bother. Keep track of things in a notepad or simple excel file and a folder for receipts.

for rent-what is the person currently doing? Use that if it works.

For utilities-what does the current lease say?  Follow that until it ends.  If the house is vacant, have the tenant pay for all of the utilities themselves.  Check with the providers to see what is tied to the house and what isn't.  Anything tied to the house means if they don't pay it, you have to.  For things like that you can present the tenant with the bill and they add it to the rent and you pay the bill directly, so you know it is paid.

Also make sure the damage deposit is transferred to you from the previous owner at closing as that money belongs to the tenant. Do an inspection as soon as you close making note of any problems.  Use this inspection as a starting point for when the tenant moves out to assess any damages. So if there is a switch cover that is broken now, you can't charge them for it when they move out as you have no idea if they did it before you bought it or if it was like that when they moved in.

[Drew Sygit]

1) At least annually, preferrably 60 days or so before lease renewal, so you do NOT renew someone who doesn't take care of the property. Otherwise, it would depend on the maintenance requests and what is observed during them.

2) Require them in writing, so you can track them! Text is okay if you can copy the texts somewhere else. Get a GoogleVoice number, which allows this. Only exception is "blood or flood" emergencies (everything is an emergency to a tenant).

3) whatever your tax professional recommends.

4) Any way but NOT picking rent up or accepting cash - unless tenant direct deposits to your bank account.

5) You'll want to improve your lease over time as you deal with tenant issues. Most leases you access for free are very basic and worth exactly what you paid for them.

6) Why would you do that? Will just invite broke tenants and utility abuse.

How are you going to screen tenants?

[Joseph Wilson]

Congratulations on the Greenville area. I also invest here. Please message me to discuss this further. 

[Joseph Wilson]

Sorry for the few days response

[Max Emory]

Congratulations, @Paige Seeley!! That's huge! I remember how stoked I was closing on my 1st rental!

1) Our PM conducts quarterly walkthrough inspections. It's a great time to document what has changed with each unit and to assess if there are any necessary maintenance requirements the tenants have not communicated.

2) I'll defer to other investors for this one since I've never self-managed (other than STR/MTR). Preferably you have a tenant portal through a PM software that allows the tenants to make requests. And, make sure you have backups on your vendor list when your primaries aren't available.

3) Bookkeeping is my wheelhouse so here we go: 

Once you have more than a few properties, you'll want to consider a software. But, excel is totally fine in the beginning (in addition to your PM software to capture transactions outside of the properties).

We use QuickBooks Online exclusively for all of our REI Clients. I use it for my personal portfolio as well. We've found it has superior reporting features, integration features, and is overall more efficient to work within than other REI-specific software.

The downside is QBO is not set up for REI so you'll need to do that or work with an expert to ensure it is set up for your business appropriately.

If you want to discuss any of this further, I'm happy to answer questions and help walk you through it.

4) I'd recommend a PM software for this. There are some affordable options.

5) I'll defer this one to the self-managers on here.

6) I don't think this is necessary unless your property is overpriced rent-wise. If you decide to do this, make it a one-off or no more than a few months like a bonus incentive to sign but it doesn't last the length of the lease.

Best of luck to you, Paige!

[Markus Shobe]

For one property just use excel. No reason to complicate it. Money comes in put under rental income and have different categories for expense (supplies, taxes, insurance, and etc).