Managing your property requires the right expertise and experience to become a successful investor. It may be somewhat simple in the early stages of owning property, but as you work toward your long-term financial goals (or add more properties to your portfolio), mistakes can happen.
What are some of the biggest mistakes DIY landlords make? Errors can be costly! Check out these Top 5 mistakes (and how to avoid them) with insights from Jacksonville property managers.
1. Failure to Run Appropriate Checks on Potential Renters
No property owner wants their units to remain vacant. High vacancy means you are losing a considerable amount of money. While this may be a frustrating experience, it doesn't skipping the screening process to get a renter into your property quickly is always a bad idea.
Without checking into the background of a potential renter, you could miss out on crucial details that are essential before accepting the renter, such as:
- Employment and income verification to make sure pay for the rent on your property
- Whether the resident has previous rent defaults or bankruptcies
- If they left their previous rental unit in an acceptable condition
Placing an unqualified tenant can lead to missing rental payments, property damage, and costly problems for investors in Jacksonville!
2. Setting the Wrong Rent Amount
It's easy to make this mistake without the right research. Setting the rental rate by assumptions or to match the house next door can be a significant error leading to problems including:
- Rents that are too low might keep your units fully occupied, but won't generate the return you need to cover expenses
- Overpriced rentals that stay vacant because renters aren't willing to pay that much based on the market.
Your property's ideal rent amount depends on several factors such as rental averages, neighborhood conditions, demands, and market trends.
With insights from Jacksonville property managers, rental property owners can analyze the market and determine the best monthly rent price for each property in a real estate investment portfolio. Be careful not to sell yourself short with rents that are too low or too high!
3. Performing Maintenance Tasks You Are Unqualified to Do
As a landlord, you may assume that hiring experts to perform maintenance tasks is a huge financial burden. Resorting to DIY repairs and online tutorials to fix maintenance issues can seem like a smart way to save money instead of calling a repairperson.
However, this is often a big (and costly) mistake. DIY fixes can often cost more than hiring a professional handyperson when you make multiple trips to the hardware store (or make a trip to the emergency room when you hurt yourself during a repair). It's also a great inconvenience to renters since a DIY fix might need additional follow-up repairs.
Tenants prefer rental properties that respond quickly to maintenance issues and deliver quality repairs the first time. You may lose good renters if you don't match their expectations.
Avoid the mistake of "saving" money on DIY maintenance solutions. Hire reputable contractors to make repairs and handle routine maintenance. Partner with the best Jacksonville property managers that can handle every maintenance issue for you!
4. Setting Unrealistic Financial Expectations
Owning a rental property is an excellent way to earn passive income. However, you should be realistic about your financial expectations. Some investors assume that you simply need to place a tenant and collect the rent to cover all your expenses—and the rest goes in their pockets as profits.
However, underestimating ongoing expenses and profit margins can leave you missing the mark on your financial goals. Without the right rent amount and an accurate assessment of Jacksonville property expenses, investors don't have enough cash flow to operate rentals efficiently.
Property owners must factor in maintenance and repair costs when planning an operating budget Additionally, other tasks such as marketing your rental units, rent collection, and dealing with tenants might cost you more than you expected.
Work with a property manager in Jacksonville to estimate annual budgets and track income and expenses to manage your income expectations.
5. Not Hiring a Property Manager
Many DIY property owners will avoid hiring Jacksonville property managers because they feel like it's one more expense that they don't need. However, property management is time-consuming and quite demanding when you do everything independently. You will have multiple rental property responsibilities on top of a full-time job and the time needed for friends and family.
To avoid all these hassles, hire a property manager. They take care of everything with the experience and expertise to maximize the returns on your rentals. Avoiding mistakes and making more money is easier with the right property managers caring for your tenants and rentals.
Skip the Mistakes With a Jacksonville Property Manager
Hiring a property manager is the smartest way to enjoy passive real estate investment income in the Jacksonville market! Skip the mistakes that inexperienced property owners make and let Spectrum Realty Services help you set the ideal rental prices, find quality tenants, and handle every maintenance need. We're to talk about how we can help!
If you're ready to find the right property manager for the job, download our free guide today!