In his book Good to Great, writer Jim Collins observed that 'Great vision without great people is irrelevant.' For a Seattle property owner, bringing a great vision to reality takes hard work, a healthy appetite for risk, and a lot of time. However, as Mr. Collins noted, you often need great people at your side. Otherwise, all your effort could be rendered irrelevant.
When it comes to your home rentals you success can depend on working with an exceptional property management team! These experts can help you avoid making some critical mistakes that often plague the profit potential of DIY property owners. Here are some of the most common hang-ups to avoid as an investor in the Seattle area.
Not Screening Renters Properly
While you can control many elements of your property and its condition, you can’t control the people living in it. That’s why properly screening renters is so important—and why not discriminating during your screening process is crucial.
When you need to get renters fast in order to help your books shift from red to black, it can be tempting to cut some corners to help grease the wheels. While this may help you get someone in your Seattle property, it could also cost you down the road. Here are some mistakes a DIY property owner may accidentally make during the screening process:
- Not running a credit report: A smile and a firm handshake just don’t cut it anymore. Even good people can be bad renters, and a credit check can help reveal poor money and debt management habits.
- Not thoroughly checking references: Perhaps you call one prior property owner, get a good report, and move on to the next item. It’s important to check several references so you can get a clearer picture of the renter.
- Not checking their previous rental history: Multiple evictions should make you think twice, and if you overlook this aspect of screening, you could land yourself a problematic renter.
Keep in mind that you can always rely on the professionals to handle screening for your investments. This is one area where Seattle property management services can be a tremendous aid.
Setting the Wrong Rental Rate
The wrong rate can make the difference between making a profit and making a mistake. If the rate is set too low, you may not be able to get the best ROI. At the same time, if the rate is set too high, you may scare away good renters. Here are some factors that some Seattle property owners may overlook on their own:
- Doing a thorough market analysis: You need to check single-family and multi-family units that have similar amenities and neighborhoods as your units, including access to the same quality schools.
- Over-pricing newly-built or updated units to help recover costs: While a higher rent can be a shortcut to recouping your expenses, it can also render your unit un-rentable—and make it a blight in your portfolio.
- Underpricing to get a new renter in quickly: It’s better to optimize your marketing to draw in new Seattle renters than to drop the cost too much. A renter paying the right rate will help offset costs better in the long run.
If you need assistance correctly pricing your home rentals, Seattle investors, reach out to a property manager! Experts like Real Property Associates provide this kind of rental price analysis research.
Poorly Performing 'Preventative Maintenance'
Even handy property owners may miss a step or two if they try to tackle their own maintenance requests. Often, seemingly simple maintenance tasks can end up taking far more time than they should have. Your time is money, and spending more time than you need to maintain your property could preclude opportunities to expand your portfolio.
As a Seattle-area investor, one of your primary objectives should be to work on adding new properties—as time and circumstances allow. If time is spent fixing and re-fixing maintenance issues, you may lose out on the chance to find good deals. DIY maintenance can also end up costing you if you don’t have professional experience with the type of job you’re tackling.
Not only can errors eclipse several days of an already busy week, but you may have to pay someone to fix your mistakes later! Hiring a pro from the get-go is often the best—and less expensive—choice for managing maintenance requests.
As a DIY real estate investor, it can be easy to underestimate expenses because you may think the cost of maintaining a rental property is about the same as maintaining your own home. Unfortunately, there is often a big difference.
With your own home, you can choose when to fix things and even to let some stuff go and send it to the dump. When you’re renting, your residents’ needs supersede your own timetables and reasoning. This may involve more cost than you realize, and working with property management services can help you tighten up your overhead estimates.
Not Hiring a Seattle Property Management Team
A professional property management company can give you the 'great people' you need to turn your business vision into a reality! Full-service property management means having a partner who can screen your renters, help you set the right rate, manage your maintenance program, and help you figure out your expenses.
With years of experience, a property management company in Seattle is in a powerful position to save you time and money, and free you up to expand your business. However, that can only be true when you find the absolute best property partner Seattle has to offer! Thankfully, we make them easy to find: just download your copy of our Guide to Finding the Best Property Management Company in Seattle!