Tips When Hiring A Property Manager

t546uyftyhIf you have just purchased an excellent rental property, one that you are positive will prove to be a highly lucrative, long-term investment, know that you have done only the first part of the entire endeavor. The second part involves making a decision whether to hire a professional property manager, who will handle all the property management duties.

This is especially important if you live outside the area where your property is located, and if you are not readily available to regularly check on the property and service it. Or maybe, on the other hand, you simply do not want yourself tied to the regular day-to-day tasks, activities, and operations that a rental property requires. Maybe you just want to focus on other life activities, instead of papers and documents.

But, regardless of the reasons. If you ultimately decide to hire a professional to handle all your property management duties and tasks, there are some things you should know before setting on a quest to find the one, who will perfectly fit your requirements. The purpose of this article is to familiarize you with some of the things to consider when hiring a property manager.

Business, not babysitting

First of all, you must know that whatever individual you choose, he/she will probably not find it cost-effective to treat your property with the same passion and focus, as you would. Just remember that he/she will not be there to babysit your property, but to do business. This is, in fact, a good thing, since your property is a business investment and, obviously, not a child.

With this in mind, try to focus your efforts on finding a real estate manager, who will significantly contribute to your overall bottom line, and who will be skilled and diligent enough to handle the three key functions on your behalf.

As little vacancy as possible

For this to happen, a property manager needs to be capable of keeping good tenants in your building. He/she also needs to possess a skill with which to attract potentially new tenants, in the case of a vacancy. You will have to be assured that the property manager you have hired, will be capable of attending to the issues and problems that might concern the tenants, which can include repairing an appliance or a faulty switch, or properly dealing with some other, excessively loud tenants. If there are vacant rooms, you will need a manager, who will get the property ready to re-rent, advertise it and show it to potential tenants.

You should keep your property rented at market rents

5t6y7utyjthrHaving a building full of tenants, who are not paying the same rent as tenants living in other buildings, in the same rent market, will not contribute to your profits. What you will need is a manager, who will be perfectly capable of keeping on top of market rents, and making sure your rent charges do not lag behind the competition.

Perfect control over the budget and the operating expenses

A property manager you hire needs to keep your property in perfect shape and service, by ensuring that all the operating expenses and bills are paid in a regular and timely fashion. Also, he/she must ensure that the overall costs and expenditures remain within the limits of the allocated budget. If the manager thinks the budget is unrealistic, he/she should notify you immediately, to reconsider and discuss the budget.

Factors To Consider When Determining The Best Real Estate Hot Spots

5t6y7ut6hThere is no one in the world of real estate, who doesn’t know that the word “Location” is the one that can make or break someone’s real estate career. But, what does that exactly mean? What should you know about a specific location before you buy a property for a long-term rental? Will you buy it because it is in your city or state, or because it is one of the best real estate hot spots to invest? Maybe, you have someone there who will look after it? The reasons can be plentiful.

In most cases, people will buy property that is closest to their place of living. However, if you decide to do the same, there are high chances that you will make a wrong purchase. Buying a property in a local market with clearly poor returns is far riskier than buying a property in an out-of-state market that promises strong returns. The key to succeeding in real estate is to initially minimize your risks, and then fully maximize your returns. But, how do you do that?

What to consider when choosing a place o invest in property

Clear goals

First of all, start by clearly defining your end goals. Before you start considering various hot spots and locations, you should figure out what is exactly the purpose of your investments and what do you expect from it. Some markets can be quite good for a great cash flow, but not so much for appreciation. Making a decision of what is more important to you must be your starting point.

Once you have established your objectives, it is time to determine what are the hot spots that can effectively fit those objectives.

Start from the top and head downwards

Begin at a macro level. Try to identify MSAs or Metropolitan Statistical Areas that might look interesting. The Federal Government defines an MSA as one, or some counties that have a population of at least 50.000 and at least one urban core. There are exactly 366 MSAs in the country so that you will have a wide choice.

Once you have identified some interesting MSAs, proceed by accurately analyzing the economic and financial properties of the area. The best way of doing that would be to determine the overall financial and industrial health of a city or area. You can do this by paying attention to the following factors:

1. What is the population?

Since you will need people to rent your property, search the cities with high populations. Try not to go less than 100.000. Most real estate investors prefer cities with populations between 200.000 – 1.000.000.

2. Shrinking or growing population

This is perhaps the most important factor. If the population of a particular city is shrinking, that means you will have much less potential renters in both near and distant future. Population decrease is a clear indication of a city’s poor financial health. Always make sure to look for the cities that have a population growth above the national average.54y676juyftyrht

3. The unemployment rate

Employment is yet another indicator of financial health. If people have no jobs, they won’t be able to pay for rent. It is as simple as that. Make sure to look for cities with rising employment trends.

4. Safety

Last, but not least, check the cities for their crime rates. Before making a choice, you will have to determine which areas are perfectly safe and which are filled with crime. Just remember that crime rates can vary from area to area or neighborhood to neighborhood.