Golden Rules to Live By to Achieve Property Management Success

When first starting out in the property management business, or even just as a rental property owner, you are sure to make some taxing mistakes. Unfortunately, it comes with the territory of being new to a competitive industry.

However, some mistakes are so dire that they can mar your reputation, or worse—they can cause you to lose your monthly rental income.

For those of you looking to clue in on the top secrets to property management success, you are in the right place. Today we are going to look at the golden rules to live by so that you can build a respectable reputation and keep the cash flow you receive each month in the green.

The Rules

Before jumping in to some of the lesser-known rules for achieving property management success with your rental properties, let’s review some of the most fundamental things all property managers should be aware of regardless of experience:

• Screen tenants and never discriminate. Having a structured tenant screening process, whether you employ a property management company or manage your rentals alone, is the key to placing high quality tenants in your home. However, to avoid any legal troubles that may cost you your business, do not discriminate against any protected classes.
• Offer easy and automated rent payment solutions. One of the best ways to maintain success in the rental property business is to collect all of your tenants’ rent payments every month. This is most easily done by providing your tenants access to an online portal where they can sign up for automated rent payment. By doing this, you are guaranteed your collection of rent, or at the very least an indication to you when there is a missed payment.
• Draft a solid lease agreement. It is often noted that if it is not in writing, then it doesn’t count. This applies to your rental agreements as well. In order to be a successful property manager, you must have a strong lease that outlines the responsibilities of both you and your tenants. This way if you ever need to defend yourself, you have a legally signed contract to fall back on.
• Stay on top of repair requests. Your tenants expect you to provide exceptional customer service. And, with this comes prompt, honest, and fair repairs to the home they reside in every day.

These rules are things that all people involved in the rental property business should know, oftentimes before even becoming a property manager or property owner. Next however, we will look at some of the commonly missed rules you should follow in order to maintain your success as a property manager.

1. Understand How and When to Use Notices

Every state has their own requirements when it comes to giving “proper notice” to tenants for things such as visiting a rental property or terminating a lease. As one of the biggest pain points for property managers, do yourself a favor and learn your state’s regulations. In addition, take the time to learn the different circumstances you may encounter that might require an official notice. For instance, some common notices include:

• Eviction
• Lease renewal
• Lease non-renewal
• Notice to enter
• Notice of increase/decrease in rent
• Rent reminder
• Change of ownership/property management

2. Have a Tenant Retention Strategy

Are you renting to high quality tenants that pay on time, rarely complain, and take care of your property as though it is their own? If the answer is yes, then you had better have a plan in place for keeping them in your property for as long as possible. After all, long-term tenant retention is a great way to keep your positive cash flow in place. Here are some great incentive ideas:

• Rent reduction
• Gift cards to a nearby retailer
• Minor property upgrades
• Painting a room

Using any number of these rules, in addition to providing your tenants the best living experience possible, will increase your tenant retention rates significantly.

3. Use Security Deposits for Actual, Itemized Damages

Collecting a security deposit at the beginning of a rent term is one of the best ways to protect yourself from the unthinkable such as extensive property damage or non-payment of rent. However, there are strict rules when it comes to utilizing a tenant’s security deposit. In fact, you must record and disclose any money you withhold from your tenant’s security deposit at the end of the lease term to avoid excessive fines and possibly a day in court.

4. Employ Leaders to Manage Your Properties

Being a good leader means being accountable. Whether you manage your own properties or employ a property management company, it is important that those in direct contact with your tenants maintain the important traits that come with being a good leader.

• Exceptional communication skills
• Emotional intelligence
• Honesty and integrity
• People skills
• Knowledge
• Organizational skills
• The ability to delegate
• Confidence
• Positive attitude

In the end, successful property management takes a lot of commitment. It is not the kind of business to take lightly, since so much is on the line when you find yourself responsible for tenants residing in a rental home.

In order to establish yourself as a reputable property management company, or a property owner worth leasing from, it is incredibly important you follow the golden rules listed above if you want to achieve success. Those rules, combined with passion, time, and a whole lot of effort, will help you reach that desired success in no time.