When our clients begin managing a property they have invested in, we often suggest they use various risk solutions in order to ensure the value of their property is as high as it can be. These solutions are often simple strategies commonly overlooked by homeowners that help lessen property depreciation. In general, we encourage our clients to follow four commandments when managing their property.
Command of Appearance:
Keeping a well managed property both on the inside and outside is essential to maintaining the image of a livable residence. For some, the tasks of; yard maintenance, home repair, and proper cleaning seem rather daunting, not to mention time consuming. This being the case, it is important to rely on proper licensed property management companies to ensure a job well done.
Command of the Market:
No different than any other good, the price of a property on the market will constantly fluctuate. Real Estate investments should be treated as value investments targeting a positive return in the long run. That being said, an owner must be an optimist and remain confident in their investment even when the value may appear at a down point of the cycle. Conducting research to remain educated about the prices of homes in the neighborhood and similar markets will allow the owner to benefit most from his sale.
Command of the Tenant:
Tenants bring additional property value through their monthly rent payments. An owner must ascertain the value of operating and property tax in order to charge rent accordingly and ensure a profit from his tenants. Conversely, he must also carefully screen his tenants in search of reliable persons that will pay their bills on time.
Command of Finances:
Having knowledge of interest rates is crucially important to adjusting proper rental rates. A time of lower rates can offer an owner insight on when it is a good time to refinance. Attention to detail will help the owner pay off the mortgage, reduce his taxes and begin to earn a regular cash flow that is direct profit.
