If you own or manage multiple rental properties, you know how challenging it can be to keep them all occupied, maintained, and profitable. Vacancies and turnovers can eat into your cash flow and cause headaches. In this article, you'll learn some tips and best practices to deal with these issues and run your rental portfolio more efficiently.
One of the best ways to avoid vacancies and turnovers is to find reliable and long-term tenants who will pay rent on time, take care of the property, and follow the lease terms. To do this, you need to screen your applicants thoroughly and check their credit, income, rental history, and references. You can also use online tools or services to streamline the screening process and save time.
Vacancies are going to naturally happen but the key is to make the turnover as seamless and budget friendly for your landlords as possible . This is accomplished long before the vacancy but at the lease signing. Choosing great tenants is the key to quick turnovers. Normal wear and tear can be expected and is a reasonable risk landlords must accept. Initially choosing the wrong tenants is what makes the turnover cost prohibitive and lengthy. Choose tenants wisely!!
Make sure the new tenant has enough liquid funds in the bank to last 12 months without income. Always price the rental rates under market short term.
Screening is a proactive measure to ensure rent gets paid on time, but its efficiency differs according to local regulations. According to hundreds of my clients over the past 5-8 years, even the most thorough checks have been proven wrong. Engage with your prospective tenant and start a meaningful conversation. If unsure, some owners ask for 6 months or more of rent paid in advance.
We employ proactive strategies to minimize downtime. Thorough tenant screening ensures reliable occupants, reducing turnovers. Timely communication and addressing maintenance concerns promptly enhance tenant satisfaction, promoting lease renewals. When vacancies occur, we leverage digital marketing and professional photography to showcase properties, maximizing visibility. Streamlined application processes expedite tenant placement. Periodic property assessments guide preventative maintenance, minimizing unexpected issues. Additionally, competitive market analysis helps set optimal rental prices, attracting quality tenants. Our commitment is to maintain high occupancy rates while ensuring tenant satisfaction and property value.
Another way to manage multiple rental properties efficiently is to automate your rent collection and communication with your tenants. Instead of relying on checks, cash, or money orders, you can use online platforms or apps that allow your tenants to pay rent electronically and securely. This will reduce the risk of late payments, bounced checks, or lost mail. You can also use these platforms or apps to send reminders, receipts, notices, and messages to your tenants and keep track of your transactions.
RealPage did a survey recently that discovered 79% of renters would prefer to communicate with property management via text, chat, social media. Said another way, the potential tenant base overwhelmingly prefers to communicate via technology rather than in person or over the phone. As a result, property owners and managers need to create a fully developed, centralized communications hub handling the full lifecycle of tenant interaction from the initial contact until s/he vacates. It also needs to accommodate tenants’ payment preferences which are increasingly mobile and tech-enabled.
Studies suggest that most residents already make up their minds about renewal within the first several weeks of moving into a property. That being said there are a couple important things you can do to make sure your resident stays put. The first is to set your market rent correctly. Additionally, you need to make sure your property is ready for them to move in. Take advantage of the vacant unit to do things like replace old or outdated appliances that are on their last leg, improve the landscaping, and hire a professional to deep clean the property.
If you have too many rental properties to handle by yourself, or you don't have the time, skills, or interest to deal with the day-to-day operations, you may want to consider hiring a property manager or a team. A property manager or a team can take care of the marketing, leasing, maintenance, repairs, inspections, evictions, and legal issues of your rental portfolio. They can also help you find and retain good tenants, negotiate rents, and increase your income. However, hiring a property manager or a team also comes with a cost, so you need to weigh the benefits and drawbacks carefully.
Management companies are a dime a dozen, carefully screen them before making a decision on which company best suits your product type. Check references and make sure their accounting dept. is local or you will be waiting to long for net income checks.
Even if you have the best tenants and the best property manager, you can't avoid vacancies and turnovers completely. They are inevitable in the rental business and you need to plan ahead for them. You need to budget for the lost income, the advertising expenses, the cleaning and repair costs, and the time it takes to find and move in new tenants. You also need to keep your properties in good condition and update them regularly to attract and satisfy your tenants.
A great maintenance team and a hungry leasing staff is going to be your true #1, but what within the process are you taking advantage of that has helped set them up for success? Maintenance: Utilize the pre move out inspection to your advantage. Its a legal requirement that must be offered to tenants, might as well make this your opportunity to order the right supplies, pre-schedule the turn process, and revisit the timing of all your move outs. Could you re-structure move outs strategically to your advantage? Are you staffed properly at the time you need most? Having video of the exact unit fully completed and turn ready is always key to have. So get a perfect video made before the new tenants move in.
The best way to deal with this situation are 1.fully active in house leasing team 2.Offer rent free period to attract tenants 3. Offer commission to external brokers 4. Offer rewards to existing tenant to get new clients introduced 5. Offer freebies 6. Excellent customer service staff 7. Backed by great maintenance team
One more tip to manage multiple rental properties efficiently is to diversify your rental portfolio. This means that you don't put all your eggs in one basket and you invest in different types of properties, locations, markets, and niches. This way, you can reduce your risk, increase your cash flow, and take advantage of different opportunities. For example, you can invest in single-family homes, multi-family units, commercial properties, vacation rentals, or student housing. You can also invest in different areas, cities, states, or countries.