Investing in property is one of the most lucrative passive income makers a landlord can undertake—if you do it right. When you understand the basics of property management and investing, then you can sit back and watch your investment reward you with healthy cash flow. First, though, let’s help you grow your investment portfolio in Sarasota the right way with some tips!
1. Choose a Low-Risk Property
This advice sounds like a no-brainer: who wants to begin with something that will be a bad experience, right? Well, many times, investors want to put a small amount of money into a starter home or a “fixer-upper house” that they can fix up and then rent out.
While this may sound like a good idea because of the low investment, it may not be the best route to go—especially for the novice investor. It may prove a wiser move to begin with a property that requires minimal upfront effort yet results in high yield. However, some homes merely appear “run down,” but structurally, they are solid. A home with robust structural integrity may be worth the investment. It won’t cost much time or money to do minor fixes. You need to make sure that you’re not getting more trouble than the house is worth!
2. Hire an Expert Property Management Company to Guide You
One of the most critical things you can do for your investments is to hire an expert property management company.
There are so many things to do when you own investment property: from juggling maintenance calls to screening tenants to managing the lease signings; there are plenty of tasks for even the most seasoned of landlords.
That’s not all there is to do, either: some tasks may require a sub-contractor, accountant, or legal expert to get the job done. However, when you hire a property management company, you get everything you need in one bundle.
The right property manager in Sarasota will guide you with up-to-date market analyses, so you know how much to charge for your investment properties as you grow. Also, they provide a broad range of additional services, such as:
- Accounting
- Tenant Screening
- Rental Collection
- Maintenance
- Inspections
- Marketing/Advertising
- Evictions
A qualified property manager will often have connections with realtors as well, which means growing your investment portfolio in Sarasota has never been easier.
3. What Tenants Want Is Different Than What You Want
You must think like a tenant—not a homeowner; this will require a shift in thinking from what you may be used to. Homeowners are moving into a home with ideas about how they want to fix things up to make it a permanent place. They may want to make changes with the interior or exterior of the house that will personalize it. Maybe they won’t care too much if the walls are painted an odd color, because they plan to change them anyway. They may have ideas for the landscaping, also, which could result in a complete upheaval of what is already in place.
Tenants are different in that they want a place that’s ready to go: they expect the landscaping, paint, carpeting, and cabinetry to be complete. Although they’ll put a few personalizing touches to the home with their décor, they’re not expecting to do a complete overhaul. For this reason, it’s essential to make sure your Sarasota investment properties have neutral walls and flooring, and the exterior of the property looks beautiful when they view the rental. This is where a competent property manager steps in: he or she will ensure the house meets the tenant’s demands.
4. Location Matters When Investing
If you’re not familiar with an area, you may purchase what you think is a decent piece of investment property. Maybe you’ll get it for a “steal.” Later you’re disappointed to discover it wasn’t such a hot piece of real estate after all. What was wrong with it? It wasn’t the house; even the property was decent. However, the location was less than ideal.
When this happens, a couple of things may result; people who know the area will avoid renting the home unless the price is lowered, or, for those who aren’t familiar with the area, they may not stay long. After the lease is up, they’ll be gone. Neither one of these scenarios is desirable.
The only way to avoid this is to purchase homes in a desirable area. When you have the aid of a property manager in Sarasota, then this won’t be a problem. You’ll get the inside advice on how to find and select the best property based on a thorough market analysis.
5. Screen Tenants Thoroughly
Even with an excellent property and fantastic location, you can still fall flat with a bad tenant. How can you tell if the person you bring in turns out to be a dud? That’s where a property management company in Sarasota steps in and helps reduce the risk of a wrong placement. Property managers have tools at their disposal that will weed out the bad tenants so you can relax and bring in the rent every month!
With these investor tips, you will be on your way to bringing in the passive income you dreamed about. However, there’s more to growing your portfolio than just the few things we’ve covered here. That’s why Real Property Management of Sarasota & Manatee is proud to offer you our rental analysis—for FREE! Get in touch with us today to see how we can help you grow your real estate investment portfolio in Sarasota.
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