Tips for Owners to Manage Rental Properties

Posted on: Mar 11, 2022 | | Written by:

Tips for Owners to Manage Rental Properties

Investments in rental properties are on the rise as investors are realizing the immense potential of the rental property market. There is a huge demand for rental flats, PG accommodations, and even independent houses in metro cities. People travel to metros for job opportunities, education, or because of a job transfer, due to which there is an ever-increasing demand. Some people prefer renting a property over buying one as it is more affordable and relocation is easier. With work from home culture gaining popularity, demand for rental properties is increasing in Tier 2 and Tier 3 cities as well.

Rental property management requires the owner’s involvement and time. If you are not able to manage on your own, you can always hire a professional property management service that will help maintain your property to generate revenue. Before you rent out your property, get a home insurance plan for your property to cover any risks related to renting.

Rental Property Management Responsibilities

When you rent your property, you need to manage many aspects of your rental property to earn good and steady returns. Let us explore what are these aspects of the key responsibilities of an owner in managing a rental property,

1. Finding and Managing Tenants

Finding and managing a tenant is the first and immediate responsibility of an owner. Tenant management involves several processes:

● Screening of Tenants - Advertise your property to invite tenants. Mention your expectations for tenants whether you are looking for families, single occupants, students, etc. Fix appointments with interested candidates. Prepare a list of questions to ask, check credit score, background, income stability, period of stay, and cleanliness of shortlisted tenants.

● Preparing a Lease Agreement - Once you find a good fit, prepare a lease agreement mentioning terms and conditions agreed upon by both parties. It should include rent amount, security deposit amount, tenure, rules, rent revision terms, and other details. As it is a legal contract, you can hire a professional for drafting the agreement. Sign the agreement in presence of a witness.

● Rent Collection - Set a due date for rent collection. Fix a grace period for late payment and late fees. In case rent is unpaid for two consecutive, clearly mention the course of actions to be taken.

● Repair Requests - Clearly specify repairs that are your responsibility and also repairs that are your tenant’s responsibility. Responding to every repair request may cost you your peace of mind. Maintaining the structure and installations provided is the owner’s responsibility, however, any usage-based repair is the tenant’s responsibility. To avoid any disagreements, check all the fittings, installations, and structure and note down all details before handing over the property. If possible carry out inspections regularly. Also never delay genuine repair requests.

● Moving Out - When your tenant decides to move out, make sure that he has cleared all dues such as utility bills otherwise you will have to deal with it once he is gone. Also, check for any damages before returning the deposit. It is the tenant’s responsibility to hand over the property in its original condition otherwise any repair or cleaning charges will be deducted from the security deposit.

2. Property Maintenance

Maintaining the rental property is the responsibility of both the owner and the tenant. However, the owner and the tenant should agree on what is their responsibility to avoid any disputes. If the property is not maintained well, you can face issues if you need to file a claim under your home insurance plan. To ensure that your property is maintained well, conduct regular inspections.

3. Managing Finances

Managing finances is also a crucial part of rental property management. It does not only involve collecting rent but a lot of other things like paying taxes, insurance premiums, society maintenance charges. Failure in managing any of these can cause trouble when you try to rent your property.

Benefits of Hiring Property Management Company

Managing a property yourself gives you full control over it and you are aware of the problems instantly. However, it is a time-consuming business as you are responsible to take care of everything. But in certain aspects, you may lack knowledge or expertise, in such a case it is best to hire a professional. For instance, you can seek help from a lawyer for making a lease agreement.

But how do you manage a property when you reside in another city or country? In such a situation you can hire a third-party property management company. Hiring a property management company has many benefits like,

● These companies manage everything for your rental property right from property evaluation, finding tenants, making lease agreements, rent collection, and maintenance.

● They act as a common link between the owner and the tenant.

● They let you enjoy your rental income with freedom from managing your property.

● Increase your investment value through professional management and good marketing.

● Provides legal services.

● Provide keys management and interior services also

Conclusion

Managing a rental property is not as simple as it sounds but with the above-mentioned tips you can manage it with or without professional help. Hiring a professional will cost you money, so if you reside at the same location as your rental property, manage it on your own with some professional help on matters out of your expertise. However, for non-resident owners, hiring a property manager is the best way to manage a rental property. In any case, get your property insured with a good home insurance plan.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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