Mastering Rental Property Management: Top Strategies for Success

Editor's Note: This post was originally published in March 2020 and has been completely revamped and updated for accuracy and comprehensiveness.

Are you considering investing in a rental property? Or perhaps you're a seasoned landlord looking to streamline your property management strategies? No matter where you are in your journey, it's essential to understand that successful rental property management is not just about buying the property itself. There are numerous moving parts to consider, from legal contracts to tenant management, property maintenance, and finances.

If you're feeling overwhelmed already, don't worry— you're not alone! Many real estate investors, novice and expert alike, find themselves struggling to keep everything in check. However, the good news is that there are various strategies for managing your rental property, and you don't have to do it all on your own.

This blog will delve into the top three successful rental property management strategies. We'll cover everything from managing your tenants, maintaining your property, and conducting inspections, all the way to keeping your finances in order. We'll also discuss whether you should tackle it all on your own or hire some professional help.

Whether you're a DIY landlord or looking to outsource some of the work, this guide has got you covered. So sit back, relax, and get ready to take your rental property management game to the next level!

Mastering the basics

So, you've bought your rental investment property, have your business plan put together and are excited to start making some money. But before you can kick back and watch the rent checks roll in, you need to find some tenants. And once you do, you'll need to manage them properly.

Finding a tenant

Finding the right tenant can make or break your rental business. Even the most experienced landlords can feel anxious, especially in a slow rental market with an upcoming vacancy looming ahead. So, how do you go about finding them?

Well, first things first, you need to cast your net far and wide. Digital marketing can help you reach a wider audience, build your brand, and find quality tenants. Consider hosting an open house or advertising your property online via Craigslist or rental websites like Zumper, Trulia, Zillow, or Hotpads. You could even utilize social media to spread the word.

Tenant screening

But once you start getting applications, you'll need to start screening your potential tenants. This means ensuring you comply with fair housing laws and running background checks. Some services, such as TransUnion's SmartMove or Zillow Rental Manager, offer comprehensive tenant screening, including criminal history and credit scores. And don't forget to ask for a fee to cover these costs.

Create and sign lease agreements

Once you've found the perfect tenant, it's time to create and sign the lease agreement. But, before you do that, ensure the lease is legally binding by having a legal professional, such as a real estate attorney, verify that all legal terms are included and up to date.

The American Apartment Owners Association is a great resource to check landlord-tenant law in your state. Make sure you go over the rules and regulations with your tenant, including any restrictions on the property, renter's insurance requirements, rental collection procedures, and doing a walk-through of the rental unit.

Rent collection

Alright, let's talk about the fun part - collecting rent! In a perfect world, it would be as easy as collecting rent on time and calling it a day. But as a landlord, there are a few things you need to keep in mind when it comes to the rental property management process.

First things first, you need to set clear due dates for when rent is expected to be paid. Make sure these dates are clearly outlined in your rental agreement so your tenants know when rent is due.

You can accept various payment methods when collecting rent, including checks, cash, or electronic transfers. You must decide which payment methods you're comfortable with and communicate those rules to your tenants.

It's important to establish late payment rules, too. You'll want to decide on a grace period and determine how to handle late fees. And, of course, you'll need to have a plan in place for dealing with missed or unpaid rent.

Providing a habitable and safe place to live

Now, let's talk about your responsibilities as a landlord. Your tenants are paying you for a property that meets certain standards, so it's up to you to provide a safe and habitable living space.

Here are some things you'll want to consider:

• Make sure your property is equipped with safety equipment like fire extinguishers.
• Re-key locks before a new tenant moves in to ensure their safety.
• Ensure the property is free of pests, rodents, or roaches.
• Ensure the property is up to code and meets all necessary safety standards.
• Basic necessities like hot water and heat should be provided.
• If there are any necessary repairs, make sure your tenant is aware of them.

Once your tenant has moved in, you'll need to be responsive to any complaints or repair requests. It's a good idea to have systems and processes in place to streamline the process. Consider offering various channels of communication between you and your tenant, prioritizing repairs, and deciding whether to handle repairs yourself or hire a professional. And always respond to requests in a timely manner to keep your tenants happy and comfortable in their new home.

Giving tenants proper notice

Let's talk about what it takes to be a great rental property manager. It's not just about collecting rent and handing over keys. There's a lot more that goes into it. One key aspect is giving your tenants proper notice for various scenarios.

First up, property walk-throughs. Routine maintenance is necessary to keep your property in top shape, and that means conducting walk-throughs to check on appliances, vents, and fire safety equipment. Make sure you communicate with your tenants how often you'll need to do these inspections.

Another scenario is when a tenant moves out. You'll need to verify that the lease is over and check the condition of the unit before returning the security deposit.

And, if it comes to it, tenant evictions. It's not a pleasant process, but sometimes it's necessary. Do your research, follow the protocols, and make sure you collect ample evidence before filing for eviction.

And what about raising the rent? You might need to do it due to inflation or rising costs in your area, but it's essential to have a game plan in place for communicating with your tenants about any changes.

Next up, property maintenance and inspections. Maintaining the property is crucial to keep your tenants happy and safe. It also helps extend the life of appliances and fixtures and reduce the number of emergency repairs. 

You'll need to deal with insurance requirements and local codes, perform general maintenance tasks, and supervise hired personnel like contractors and plumbers. It's always a good idea to have a list of reliable contractors and other landlords who can help you out in case you're out of town.

Managing rental properties can be a challenging task, but it can also be a fulfilling experience with the right attitude and approach. By staying organized, communicating effectively with your tenants, and keeping up with regular maintenance and inspections, you can create a positive environment for yourself and your tenants. Dedication and effort can make you an exceptional property manager who takes pride in providing your tenants with a comfortable and safe living space.

Understand your finances

Managing a rental property can be a lucrative experience, but keeping on top of your finances is essential to make a profit. Not to worry, though; we've got you covered with some essential tips to help you navigate your finances successfully.

First things first, understanding your cash flow is essential, and keeping track of your income and expenses will make tax time a breeze. You need to keep track of rent payments, mortgage payments, advertising and registration fees, property maintenance costs, and any unexpected fines. Understanding your expenses will help you determine if you need to raise rent or take other steps to maintain profitability.

When it comes to taxes, it's best to hire an accountant who can help you maximize deductions and stay on top of the latest tax laws. And don't forget to keep your paperwork organized and secure. You'll need to keep proof of property and landlord insurance, rental applications, lease agreements, rent receipts, and walkthrough checklists.

Keeping these essential documents and understanding your finances can make managing your rental property a breeze. So sit back, relax, and let your investment work for you.

Outsourcing is another option

Are you feeling overwhelmed with the thought of managing your rental property? Don't worry.

You're not alone. It can be a lot to handle, from understanding your finances to addressing maintenance issues and legal concerns. But the good news is that you don't have to do it alone!

One option is to outsource some or all of your property management duties. Sure, it may cost more, but it can also free up your time and energy to focus on growing your business. 

Hiring a property manager typically entails delegating the day-to-day tasks of managing a rental property to a professional. This includes tasks such as advertising and marketing vacant units, screening and selecting tenants, handling lease agreements, collecting rent payments, scheduling and conducting maintenance and repairs, handling tenant disputes and complaints, and ensuring compliance with local and state regulations.

Many rental real estate investors choose to use a property manager because it can save them time, reduce stress, and help maximize their profits. Property managers have the expertise and resources to handle all aspects of managing a rental property, allowing investors to focus on other areas of their business or personal life. Additionally, property managers can help investors avoid costly mistakes such as non-compliance with regulations or poorly handling tenant issues, which could lead to legal and financial repercussions.

Another advantage of hiring a property manager is that they can help investors maximize their profits by ensuring that rent is set at market rates, reducing vacancy rates, and keeping maintenance and repair costs low. Property managers also have access to specialized software and tools that can help them manage their properties more efficiently and effectively.

If you prefer to manage your rental properties yourself, there are tools available to make the job easier without paying a property manager. For example, Kiavi's friends at TurboTenant, offer property management services to help landlords streamline their operations, from online rental applications and tenant screening to automated rent payments and maintenance requests. An option like this can be beneficial, especially if you don't live close to your rental or have multiple properties you're dealing with.

Want to learn more? Check out our OnDemand webinar. We were joined by our friends at TurboTenant to explain strategies you can leverage to support your lasting property management success. 

No matter what you choose, remember that you can always adjust as needed. If outsourcing isn't working out, you can always go back to managing everything independently. The key is to find a system that works for you and your rental property business.

Final thoughts

Whether you're a first-time investor or an experienced landlord, it's crucial to remember that property management isn't just about buying a property. It's about managing all the different moving parts that come with it. It can be a lot to handle, from tenant management to property maintenance, legal contracts, and finances.

But don't worry! By following the top strategies we've outlined in this article, you'll be well on your way to successfully managing your rental property.

By being proactive in finding the right tenant, creating and signing legally binding lease agreements, collecting rent on time, maintaining the property to habitable standards, and giving your tenants proper notice, you'll keep your tenants happy and your investment profitable. Best of luck in your rental property management journey!