The US finds itself in the grip of an ongoing housing shortage, with a shortfall of over 3.8 million units. In places like Memphis, people have resorted to camping and hotel stays to accommodate their families.
If you own a vacant home, you’ll have no shortage of tenants ready to snap it up.
That means you can sit back and earn passive income from Memphis rentals without lifting a finger, right? Wrong.
If only managing properties was as easy as that. Keep reading to find out more about what’s involved in this complex, sometimes frustrating, but ultimately rewarding task.
Aspects Involved in Managing Properties
Every property manager needs to handle three key areas. This includes financial management, tenant management, and managing the buildings.
You can either see to these things yourself, hire a full-time manager or pay for a professional property management company to do the work. Discover more about some services offered by this Memphis property management company.
If you decide to DIY your property management, you’ll need to orchestrate the following aspects:
Set Competitive Rental Rates
During a housing crisis, you could ask for sky-high rentals and possibly find a few tenants, but you’ll do a lot better if you set your rates within reasonable bounds.
If your prices are too high, you could drive qualified tenants away, while lower rents could mean you lose money on the deal.
Finding this magic number is a fine art that only comes with experience, but there are a few ways you can make the process easier.
Researching the per capita and median household for your area will give you an idea of what people can afford. Knowing the demographics of people in your area will help you market your property via the correct channels.
One of the easiest ways to find a fair price is by finding out what landlords are charging for similar properties. Then, you can adjust your rental rates up or down depending on the amenities your property has.
You can find a lot of this information online, or ask a real estate agent for assistance in setting your rental rates.
Marketing Your Available Accommodation
Likewise, you can use an online tenant screening and rental listing service to help you find qualified tenants. These services help you create a listing and publish them to the top online listing services.
You’ll receive leads directly from the website, and you can request credit checks, criminal record checks, and eviction reports on these sites, too.
Finally, if you find a tenant via this route, you can download a lease customized for the relevant state. After that, it’s up to you to collect the initial deposits and rent.
Alternatively, you can market your property yourself via community notice boards, social media, or word-of-mouth advertising. When you work with a property management professional, they will market the property on your behalf.
Screening Prospective Tenants
Tenant screening is one of the most important parts of managing a rental property. These are the steps involved:
Checking the Applicant’s Credit Score
People who have a record of defaulting on their payments may also default on their rent obligations. A credit score gives you a fair idea of the prospective tenant’s financial stability.
Criminal History Checks
Nobody wants to rent their property to someone with a history of criminal activity. It’s important to remember that people can change their ways, but you need proof of that before you should rent your property to them.
Call the applicant’s employer to ask about how long they’ve worked there and whether they earn a regular income. People who don’t receive a monthly check will struggle to pay their rent on time.
Contact Previous Landlords
A previous landlord can provide a wealth of information on whether the applicant pays their rent on time. More importantly, they can advise about whether they took good care of the property.
Routine Property Inspections
Regular rental inspections are the best way to ensure that your tenants take good care of your rental property, but they also have another important function.
As a landlord, you’re responsible for most maintenance issues concerning your property. Regular inspections will ensure small problems don’t evolve into big, expensive ones.
Keeping your property in good condition will keep your tenants happy and ensure you enjoy ongoing income from their rental.
You must give your tenants sufficient notice of your intention to conduct an inspection. It’s rude to arrive announced at someone’s home, even if you own the property.
Enforcing the Terms and Conditions of Your Lease
This is the part that most landlords dislike. Collecting overdue rent is an unpleasant and awkward undertaking.
One way that landlords make this easier on themselves and more convenient for their tenants is by setting up an online payment system. These websites provide a much easier way to ensure you get your rent on time and are ideal for landlords who live out of town.
Evicting non-paying tenants can become a legal minefield and takes at least three weeks if everything goes your way. This is one of the major reasons why landlords hire a property management firm to do the dirty work for them.
First Steps Toward Becoming a Landlord
Now that you’re familiar with the ins and outs of managing midsouth properties, or properties anywhere, you’re in a better position to decide if it’s a good choice for you.
TN rentals involve several complex steps, and it’s often better to work with an expert until you’ve mastered some aspects of managing properties. As the property owner, the first thing you must concern yourself about is the state of your dwelling.
Do your Memphis apartments need a few upgrades before you’re ready to welcome tenants? Browse our blog for more information on a wide range of home improvement topics.