There is a risk in anything that you do and that includes managing your rental properties. Whether you are in Jacksonville, Florida or L.A. there will always be risks.
Knowing what the risks are before you take on the management of your own rental properties will save you a lot of time and possibly money in the long run.
Here, we will go over the biggest risks and how to avoid each one.
1. Not Being Able to Get Tenants
Vacancy of your JAX property can be a huge issue if you don’t have money set aside. If you are having a hard time getting people to look at your listing it may be time to contact a professional.
First and foremost you need to be sure that your rental is priced correctly. There is a lot of information that goes into that number and if it too high, people will pass on your property.
A property manager like Nest Finders can help you price your rental right, get you qualified renters, remove the stress associated with finding renters, checking references, get background checks done and making sure potential renters can afford your home.
2. Having Bad Tenants
The only thing worse than no tenants is bad ones! As a DIY landlord do you know how to properly look into a potential renter who is interested in your house?
If you skip the step of properly investigating those who will be living in your rental home you can run the risk of big problems.
Regular inspections of the home, a solid background and reference check along with a tight lease agreement will keep your property filled with quality renters over time.
3. Higher Than Expected Expenses
As a landlord, you have to be prepared for emergency expenses. There is no way to know if an appliance or an air conditioner will go down at the worst possible time.
Every homeowner whether they live in the home full time or rent it out should have some savings set aside for emergencies. Just as with their primary home, an owner can set aside money monthly to be sure there will be cash if an emergency arises.
4. Real Estate Market Changes & Recession
Whether you like it or not all of the signs are pointing to a recession coming to the US. If you are looking at buying a house to use as a rental property you may be in luck. A buyers market is coming to Florida and beyond.
There isn’t bad news if you already own rental properties. This coming recession does not have the markings of the big crash in 2008. The jobs market is still holding strong at this time and should keep your renters paying on time.
5. Collecting rent
How much of your time do you want to dedicate to chasing down your renters for a check each month? Having a system in place to collect payments without having to chase down a tenant is a very valuable asset.
With a property management company like Nest Finders, all you will have to do is check your balance as the funds are deposited for you.
6. Evictions
Not every landlord will have to deal with evicting a tenant. If you are lucky it will never be a factor. Not every owner gets so lucky and there are many regulations about how to go about an eviction in Florida.
Evictions in Florida can get tricky. Knowing the law and correct steps can keep you out of hot water, but it will also mean you have some studying to do.
If you want to save yourself the hassle of having to know the law, hiring a property manager might be a better solution.
7. Taxes
According to Benjamin Franklin “in this world nothing can be said to be certain, except death and taxes.” No one has yet to figure out how to thwart death, but taxes can work in your favor.
Having a rental property comes with many ways to save on your taxes. I always suggest that you consult a professional tax preparer who you trust to advise you on what deductions you can take.
An advantage of using a property manager is not having to know all of those things on your own. A good property manager will keep track of things like repairs and their costs allowing you to just pass that information on to your professional when tax season comes around.
After reading all of that you may be reconsidering if DIY property management is for you. Please do not be discouraged. At Nest Finders, we customize your property management to your needs as an owner.
With options for everyone from the person with a single rental home to large scale investment portfolios with multiple units, Nest Finders has answers to your property management questions.
