Do It Yourself - Work Sheets for Managing your Property
A. Preparing your Property to Rent:
1) Walk thru list - Walk up to the Property, thru the front door and thru all the rooms. Make a list of all the things you see that might be questionable in appearance to a prospective tenant.
- Paint peeling or Dirty
- Broken or Damaged
- Not closing properly or functioning
- Dangerous looking
2) Make a list of Items that would be desirable to a prospective tenant.
- New Stove or Appliance(s)
- Light fixture
3) Compare the Rules for Renting with your List
- Property should be sparkling clean
- Property should look "Newly renovated"
- Appliances should be "Newish" . Most rental appliances are affordable and look nice. Stainless Steel is not that much more than "White" and makes a difference in renting. Ready Group's management group can offer you discount and wholesale prices on various products
- Put the Basic extra's in the apartment (Dishwasher, Washer/Dryer, Medicine Cabinet, Switched lighting in most rooms)
- Do not provide Microwave or any small appliance
- Do not provide A/C units
- Budget costs to be in line with the rent asked and location of the property. - If you are renting a loft in Soho for $10,000 per month you will have to buy high end appliances such as a Wolfe Stove as well as have designer fixtures and faucets. If you are renting an apartment for $1,000 your appliances and fixtures have to be reliable and look nice. They also have to fit into a "replaceable cost" budget. If a faucet cost $125 and gets damaged, It is easier to replace than a $300 faucet that ends up leaking. The cost to repair a fixture or appliance makes buying "better" not as realistic as replacing it. Again, the amount of rent charged will dictate the amount of budget for an item.
- Spend a couple of extra dollars on finishes. Put in Decora switches and plates, quality counter top, nice hardware, knobs & drawer handles. If something looks cheap to you, the tenant will certainly think the same. Price is not the deciding factor of "cheap" . Quality and materials make something look "good" or bargain basement.
- Carefully check all items to see if it is the best that can be bought for the price point. A hand shower head can feel like a piece of skimpy plastic for $20 or another brand model may have some weight, style and better finish for $30.
4. Hire a good handyman/contractor to help you make the improvements. Unless you yourself are a contractor, find someone to help you. Most things done in the apartment can be done for a basic labor cost. All money you spend is deductible. Read our article on "Making your Contractor Great" for ideas on how to choose the right people to help you. I started out doing all the work myself in rental apartments and soon found out it was faster and cheaper to hire someone. It is a business and the most unreliable thing to do is think you can take care of all of it yourself.
Advertising the apartment for Rent - Hire a Real Estate Broker to handle it for you.
As a Real Estate Broker with over 30 years of rental experience and only a couple of mishaps professionally I can only suggest that you hire someone to do this part of the project.
There is only one cardinal rule in Real Estate Renting - Stay away from your Tenants.
There is little you can do to separate you, your emotions and your feelings from the Tenant who wants to rent your property. As a trained professional, I can not do it. I say the wrong things, I try to make friends with people, I see the best in them, I make allowances. All terribly wrong when renting to someone.
- Bargaining Power
- Professional Image
- Favor-less relationship - Tenants most often will ask for things. If they think you are their "friend" they will be more inclined to ask for more, more often. If you are distant, they will become more independent and handle their problems themselves.
- No - Much easier to say no to someone or turn down their application if you are not face to face with them.
- Middle man - You have much more time to think about a prospective applicant, ask for more information,wait for other applications, since you are not directly the person who is at the front of renting procedure. It is easier for the agent to offer excuses than for you to fend off the pressure put on by the renter.
- Vetting the prospective applicant. An agent has the means to thoroughly evaluate the reliability and background of the tenant . They have had more experience in qualifying applicants and can use that judgement to assist you in choosing the right person.