You’ve decided to rent your property out for some extra cash flow. This is a smart idea, especially right now, when the economy is at an almost standstill, and everyone is sheltering at home. But renting your property may not be as profitable as you hope.
Commit some of the most common crucial property leasing mistakes and you could end up spending more than you make. Read this guide and learn how to make leasing your property into a financial success.
Pictures Don’t Do It Justice
In today’s world, pictures are more important than ever as people make rental decisions without physically visiting the property. This means that you need to have high quality images that showcase the property in an enticing way. You want them to enhance the positive qualities of your rental while also not misleading potential renters.
Hire a professional photographer to take your photos. Have one picture of the exterior and at least one image of each interior room. Be sure to show the kitchen, bedrooms, and bathrooms.
Not Pricing the Unit Right
The rental rate you choose for your property needs to cover your operating costs and still be competitive in the market. This can be a delicate balance. Getting it wrong means that you’ll lose money on your rental. Factor these costs into your pricing:
- Monthly mortgage payment
- Property taxes
- Regular maintenance
- Emergency repairs
Price your unit too high, and you price yourself out of the market. Then potential renters will move on to more reasonably priced units. If you’re struggling to find the sweet spot for your property, it can help to consult with an expert. Our team at PMI Legacy can perform a market analysis and provide you with the data you need to make an informed decision.
Not Screening Renters Carefully
Your property is empty, and you’re rushing through the application process so you can get a tenant into the home. Do not skip over the tenant screening process. Always perform these checks on applicants before giving your approval.
- Background check
- Eviction check
- Credit check
- Employment and income check
Skip over these checks, and you could end up with a less than desirable tenant. It will then cost you money when they stop paying rent, damage your property, or require eviction.
Underestimating the Cost of Maintenance and Repairs
If you want your leased property to retain its value long term, then you need to maintain it. This means budgeting for ongoing maintenance costs.
- Carpet cleaning and replacement
- HVAC maintenance
You also should have money put aside for emergency expenses. Otherwise, these are all costs you will have to pay for out of pocket.
Not Hiring the Right Help
If you have limited experience or time to manage your rental property, then things can fall through the cracks. Knowing when to hire help will ensure that the leasing of your property goes smoothly. A professional property manager knows how to avoid all of these crucial mistakes and many more. It’s like having someone watching your back and ensuring your leased property is a profitable one.
You can hire a property manager to price and advertise your property. Then they will thoroughly screen tenants and manage the rental. If for any reason, an eviction is required, they will handle this too. All maintenance and repair tasks will be managed by them and performed by their network of qualified contractors.
Avoid these Property Leasing Mistakes
Keep these property leasing mistakes in mind when you decide to move forward with leasing your property. By not committing these common crucial mistakes, you will avoid their costly consequences. Since these are not the only mistakes you can make, it’s smart to hire a property manager. They can guide you through the renting process and help you avoid these and other common mistakes.
Contact our office today and let our team help you manage your rental property.