5 Critical Steps in Real Estate Property Management

by Jennifer Minge

The key to being a successful in property management is very simple: keep your units rented, control expenses and make a profit. Successful property managers accomplish this by focusing on five critical areas:

• Filling vacancies
• Property maintenance
• Collections
• Evictions
• Financial Report

Filling Vacancy

Landlords lose money every time they have a vacancy. Successful property managers reduce the amount of time a unit is vacant by constantly marketing to attract new tenants. Marketing should be multi-prong strategy that can include signs in front of the property, advertising in the local newspaper, and offering tenant referrals. If the property manager keeps a list of potential tenants, this list can be taped each time there is a vacancy.

Property Maintenance

Curb appeal is the first impression to your property, and it can have a tremendous positive impact on your success. Everyone prefers to live in a property that is well maintained. Improving your property landscaping by adding flowers, cutting the grass and painting the outside of your building will add more to your bottom line then the expense incurred.

Once you have a tenant in your building, you want to keep that tenant. This can be accomplished by handling maintenance requests in a timely manner. When tenants see that you maintain your property they are more likely to renew their lease with you.

Collections

People invest in real estate because they can use rental income to cover the cost of their mortgage and provide positive cash flow. If tenants are not paying their rent then the landlord is loosing money. It is critical that property managers manage the collection of rents.

Evictions

If tenants are not paying rent, property managers need to quickly get rid of them. Upon non-payment some state laws may require the property manager to send a pay or quit notice to the tenant prior to filing for a dispossessory. If the tenant still does not pay, the property managers need to immediately file a dispossessory.

Financial Reporting

Real estate is a numbers game involving income and expenses. It is critical that property managers be able to provide reports that determine if the landlord is making a profit or loss on their property. These reports should be updated monthly and year-to-date.