What Real Estate Investors Need To Know About Property Management

Once you purchase a real estate rental property, you virtually become the CEO of your own small business. Sure, you feel good about becoming a landlord and owner of your own private money-maker, but unless it?s raw land, your work has just begun.

Now you must manage the property. As a real estate investor who has chosen the renting of apartments as a business, your goal now is to keep the units full, and at the highest rent per square foot possible.

So let?s consider the big picture of property management and look at some rental management basics every real estate investor should be aware of inside real estate investment.

1. Property condition. Getting the best tenants and commanding the highest rent starts with a sharp-looking building that has good curb appeal. Keep the structure, landscaping, common areas, and parking in good clean condition.
2. Tenant applications and screening. Require each potential tenant to complete an application, and then follow up to verify their employment, rental history, and credit and criminal history. Remember, it is always easier to get tenants into your building then it is to get tenants out of your building.
3. Emergency repairs. Be sure you have reputable maintenance personnel on-call to service emergency repairs. This may be your job or someone you hire, just be sure the tenant has a repair ?help line? they can call 24 hours a day when something must be fixed immediately.
4. Aggressive marketing of vacancies. Get the word out about an upcoming vacancy instantly. Use signage, advertise in the newspaper, or post it on the web.
5. Move-in/move-out coordination. Always plan to get a unit ?rent-ready? within a day or two after it becomes vacated. Even when you don?t have a new tenant in the wings, a clean unit ready to show a prospective tenant does help.
6. Keys and locks. It is always a good idea to change locks each time you have a turnover in tenants. This added security is good for you and your new tenant.
7. Learn the laws about eviction. Know what you must do to evict a deadbeat tenant even when you don?t think it is necessary.
8. Keep accurate books and records. Maintaining a good income and expense history is vital to your rental property business and the cornerstone to profitability.

Many real estate investors simply turn their properties over to professional management companies. The advantage being that it relieves the real estate investor of the time and stress of having to deal with tenants and repairs, and puts matters like late rents into the hands of experts.

On the other hand, a professional management company is not free. Moreover, in cases where the property is small enough for owner management, the cost of outside fees for professional property management might not be justifiable.

You must decide whether you want to hire out the management out or to do it yourself. The important thing is not to neglect a sound plan for property management. Otherwise you could find that owning and becoming CEO of your rental property business can quickly become more unpleasant than profitable.

James R Kobzeff is an active real estate broker and developer of ProAPOD Real Estate Investment Software - Rental property analysis at your fingertips! Free real estate investing tips are available at ProAPOD's real estate investing blog

Top 3 Commercial Real Estate Investors Time Management Strategies

One of the questions I get asked a lot from clients is how do I manage multiple real estate deals projects all at once? Here are some specific strategies for you to consider:

a) Who to spend time with?

You need to consider spending BUSINESS TIME on only those who are going to contribute to your bottom line and goal achievement. All else needs to get put into the "we'll get back to you" pile. It is easy to get locked up with people that do nothing but take up your time. Don't do it.

I constantly have people wanting to meet with me, talk with me, etc. that don't contribute to the achievement of my goals they get put on the bottom of the pile and sometimes I never get back to them.

b) Keeping away from time vampires.

Time vampires are those that call you, come into your office, and tell you the "whole story" constantly. You need to politely tell these people "adios". You ever notice that you have those days where you have a lot of activity and by the end of the day you really have not gotten anything done? Time vampires are the main reason why.

c) Having a clear objective in the first place.

What are your goals, your objectives?? Where do you want to end up? How do you plan on getting there? Without a plan you will be spinning your wheels and the cash flow and value of your will suffer because of it.

So, there you go. We did not reinvent anything today, but it is surprising how the use of your time is tied to your income and the results you want.

About Darin Garman, CCIM?Considered by many to be one of the foremost experts in North America on Apartment and Commercial Property Investments, Darin Garman assists investors in maximizing their wealth through commercial real estate investments. Over the last 13 years Darin has assisted investors in the purchase and sale of over $300,000,000 in apartments and commercial real estate, and has direct ownership and management of over $11,000,000 in investment real estate himself. Darin is a frequent guest on radio and TV talk shows, and has co-authored books such as ?Wealth Attraction For Entrepreneurs...The No Holds Barred Kick Butt Guide To Becoming Rich?, which was co-authored by Darin with business and marketing guru Dan Kennedy. ***** Have you taken advantage of the "FREE 2-Month Test Drive of Darin Garman's Commercial Investment Property Owners Association Membership" ? Go To: ***** www.garmanupdate.com or www.commercial-investments.com

Hiring Rental Property Management

Why hire rental property management? Because doing it all yourself is the surest way to make your real estate investment experience a bitter one. You also have more time to find the next deal when there is someone taking care of the details for you. Hire a good property manager, but first ask the following questions.

1. How much is the fee? Fees vary around the country from as low as 4% of gross rents for larger buildings, to as high as 12% for single family homes. Be sure the fee is clearly stated and understood.

2. What other properties do they manage? It is best if they handle rental properties that are similar to yours. It is also helpful to drive by their other properties to see how they are maintained.

3. Who will actually handle your property? It is best if one person handles your building all the time. They should also have some experience. Get their name.

4. What costs extra? Is it extra for showings? Do evictions cost extra (beyond the legal fees)? Any other extras?

5. How is the fee collected and when? Will you be billed, or will it be deducted from your account directly? Monthly? Quarterly?

6. What type of advertising? How do they advertise the units and what does it typically cost you?

7. Cost and time to prepare units? What is the typical cleaning fee on a vacancy, and how long will it normally be before it's rented out again?

8. What needs owner approval? What dollar amount needs your authorization, and is this negotiable?

9. Hours of operation? What are their business hours, and who takes weekend calls?

10. Accounting? What reports do they send? How often? How are accounts set up?

There are probably other questions you'll have as well, based on your particular needs and the particular property. Ask everything up front, and you'll have fewer misunderstandings. With good rental property management, real estate investing is a lot less stressful.

Steve Gillman has invested in real estate for years. To learn more, and to see a photo of a beautiful house he and his wife bought for $17,500, visit http://www.HousesUnderFiftyThousand.com.

stevengillman@hotmail.com