Residential rental property is one of America's favorite investments. There are about 22 million landlords in the country. If you're one of these people, you're certainly enjoying the perks, including a steady passive income.
However, it's not always rosy in this business. A rental property can become a source of headaches and stress to the owner. In a tough rental market, for example, it can be difficult to keep your property occupied.
It's for this reason all owners need to know how to spot a property that needs landlord rescue and take proper action immediately. These are the telltale signs to look out for:
1. Property in a Deplorable State
This is an easy giveaway that a rental property needs to be rescued. From the exterior, you'll see that the building can do with a fresh coat of paint, or the roof could be in a bad state.
Some properties might look okay from the outside but terrible on the inside, making the owner think everything is fine. If you don't do regular interior inspections, you might not be able to catch issues like plumbing leaks and broken equipment.
Generally, if property repairs are not being done, the landlord is sleeping on their job. If you can't keep up with property maintenance, outsource the job to a professional before it's too late.
2. Low Occupancy Rate
To maximize rental income, your property needs to maintain a high occupancy rate. If you have a building with five units and only two are occupied in a year, you might not even make enough money to pay for the building's mortgage.
A low occupancy rate is a sign that the property needs rescue, especially if it doesn't have any maintenance or repair issues. This probably means the landlord is struggling to market the property, they have rental rules that are turning away prospective renters or the rent is way above market rates.
Either way, an unoccupied property is bad for business. It's time for a property manager to step in and rescue the situation.
3. Rowdy Tenants
If you have tenants who're always playing loud music, hosting late-night parties, and doing all sorts of other things that disrupt the peace of the community, there's going to be a problem. Your tenants might love you because you're not keen on enforcing rental rules, but other residents in the community can complain to the authorities. Your license to rent out the property can be revoked.
Having chaotic tenants isn't bad luck. It means proper tenant screening wasn't done.
DIY landlords often struggle with screening, but you don't have it. You can hire a tenant screening service, or find a landlord rescue firm that offers a full-service package.
Does Your Property Need Landlord Rescue?
Self-managing your rental property isn't a bad thing, but if you're not up to the task, things can go south quickly. Being able to identify when you need landlord rescue is one of the biggest strengths you can have.
If you're a Fort Collins, CO., landlord who needs rescue, come to PMI Northern Colorado. As part of a franchise group that has been in the property management business for over 20 years, count on us to rescue your property.
