To start with, buying an investment property is merely the first step on your investment journey. Actually managing the property is the next step. As your investment grows into a portfolio of properties the effort and resources required will also grow. Hence you need to be vigilant at all times and carefully plan every detail so as to attain success. As an investment property owner, there are specific management requirements you will need to have. Here are some top tips to help on managing your property investment and become successful.
Where to begin
To start with it is very important not to overexert yourself financially when commencing your investment journey. Most people usually get their foot into the property space by virtue of a renovation project. The general idea is that you purchase a run-down house at a discount, fix it up and then sell it at a profit. You can then reinvest the proceeds in another project. You can continue doing this until such a time when you can purchase a property to let.
It is also important to understand that the idea is to attach value to any property. In addition, any house or flat should provide both an income, as well as, long term capital appreciation. When you are considering buying property remember that location is key to successful property investment. Location means that your property is situated in the right place and is close to various amenities.
Broaden your investment
As you grow your property portfolio it is advisable to spread your investments. Broaden your portfolio and buy in different areas, as well as, varying market sectors.
Financial discipline at any investment level is quite important. As your investment grows, the more complex your finances will become. You will have to exercise very sound business principles. In addition, you need to have a profound insight into cash flow projections, loan to value measures and rental yield projections. It is also important to get professional accounting advice to ensure everything is in the
Successfully managing your investment property
1. Avoid tenant turnover
Keeping your tenants happy and thereby reducing turnover is one of the most important issues to address. You will be surprised at how simple things can make tenants happy and make a huge difference. For example, you can quickly respond to repair requests thus ensuring your tenants feel important and appreciated.
2. Understand landlord-tenant legislature
Another important consideration is the full appreciation and adherence to landlord-tenant law. This will ensure you effectively manage your property, as well as your tenants. Furthermore, it will help you avoid making mistakes and aid you to operate within the law. For example, you will learn the rules for when and how much you can collect as a security deposit. In addition, you will know when you must return a tenant’s security deposit.
You should also put emphasis on keeping up with property maintenance issues. Firstly, you are legally obligated to adhere to specific health and safety standards in accordance with landlord-tenant law. This also entails that you make provisions for refuse disposal. In addition, you must ensure those common areas are well maintained.
4. Engage a professional
All in all, managing either an investment property or portfolio can be extremely overwhelming. As such it is crucial for you to attain the services of a property manager. Your property manager will collect monthly rentals, pay taxes and handle maintenance fees on your behalf.