When you decided to become a “real estate investor” you didn’t know that you’d be picking up land lording as your new side hustle! It’s smart to handle property management yourself for a few years, if you’re so inclined, because it can help you save money and make sure that your property is being run efficiently and effectively. Also, when you’re ready to sell your rental property, you’ll have a good idea of the property condition, and how the rental business is going, so you can pass on the property – vacant or occupied, to the next guy.
In this article, I’m going to share some landlord tips from my 20+ years as a real estate investor where I have managed my own properties (for the first dozen or so…) and have the “throwing up” stories (yes, actual barfing has been involved twice…) to share if you ever want to hear about some of my gross property turnovers.
I’m not a “cheap” landlord who offers lower rent and lets my properties get run down and fall to the bottom of the rental market. I like to run my rental property business to provide safe, clean affordable housing that attracts good tenants who pay premium rental income, maintain the landscape in their yards, and take good care of my properties.
However, I expect you’re here for some money saving tips that will help you discover ways to save money and avoid the pain of your own unpleasant property management experiences. After years of trial and error, I have found a “stitch in time saves nine” and it’s often by investing prudently in your properties over time, that you will save a lot of money on vacancy, eviction and personal property damage as well as keeping the property looking good and healthy for years to come.
My Best Tips For Landlords To Save Money On Rent Houses
If you want to boost the long-term value of your rental, especially if you’re thinking about selling soon, it’s a good idea to stay on top of regular maintenance and make any needed repairs. Deferred maintenance is one of the most common problems in rental because the tenants don’t want to report the maintenance issues that come up because it’s a hassle, the landlord is irritated, and they’re afraid if the property becomes expensive, you’ll raise their rent. Sometimes, they become an ostrich with their head in the sand, and the landlord is happy to let sleeping dogs lie. Doing an annual or semi-annual maintenance inspection is one of the best ways to make sure the tenant is taking good care of the property, nothing bad has happened to the home, and it will help you save money because many problems are cheaper to fix if you catch them early!
There are definitely ways to cut costs on repairs so you can keep your place looking sharp. While you don’t want to cheap-out on repairs, there are still some awesome tips for saving money on fixing up your Seattle rentals.
Check out some of our top suggestions for landlords looking to save a few bucks on repairs on their Seattle investment properties!
Build A Reliable Home Maintenance Team – Contractors You Can Trust
As you probably know unless you do all your repairs yourself, finding good help is difficult. Many times Seattle contractors are so busy that they don’t even answer the phone for new client inquiries. When they do, they may not have time to come out to the property for a while, or they might over-charge you when they do come.
Start building your network of reliable contractors before you need it. Often, a retiree will do a great job with typical handyman services. I had gentleman who was a retired police officer who used to work for me for $35 an hour, which was great. Off-duty firemen aare another great resource. For many jobs, you don’t need a licensed electrician or plumber. If you can find someone who wants to make extra money, find out his rates and his schedule and try to throw some work his way on a regular basis.
Even if you don’t “need” him all the time, if you can have him to do some odd jobs at your own home, errands, mother’s day “acts of service” or other tasks, it will help keep the relationship strong so that he’ll be ready to go when a big job at your rental does come along.
Having some reliable contractors you can count on whenever you need them is so important. That way, you’ll feel at ease knowing the repairs are getting done right and that you’ve got someone trustworthy working on your place.
You won’t have to stress about shoddy work or things being fixed incorrectly. Plus, you’ll have a crew on standby to handle the cleanup once everything’s done. Figure out what tasks your property is most likely to need done regularly – gutter clean-out, re-painting, carpet repair, and prioritize finding people who can do this work. Cleaners are important, too, because they’ll be needed on every clean-out for sure. Consider “gifting” a home cleaning to your tenants every now and then, maybe upon the anniversary of their lease renewals, so that you can get another set of eyes into the property and keep their home looking good. Believe it or not, some people move because their house has just gotten so messy they need a fresh start. Help tenants stay happy in your home and feel important, and keep your contractors picking up your calls – it’s a win-win and will save you money in the long run with fewer run-away maintenance issues, and longer-duration tenants.
Save Money By Scheduling Repairs Yourself
We all know that trying to reach contractors on the phone and commit to coming to do the work can be a hassle. In fact, that’s basically what general contractors do to make their money. Many landlords want to save time and let the tenant living in the rental unit just hire their own worker, and deduct the cost of the repair from the rent.
One of my investor clients is letting a contractor move into her condo and while he’s there he’s supposed to be remodeling the bathroom. I had to warn her that this was dangerous and could go wrong in several ways. I’m hoping it works out for her, but it’s a risky idea.
Letting your tenants take care of repairs is like giving them a blank check. They’re not really thinking about saving you cash; they just want to get the issue sorted out. Do not let them know you are willing to negotiate rent if they do repairs. If they were shady in any way, they might say there were LOTS of repairs – and call a guy to do simple tasks – like changing a light bulb. Maybe they would get a friend to “do these repairs” at a high cost, and then take it out of the rent – living cheap and thinking they’d found some clever ways to lower their rent each month.
Even if they’re not dishonest though, you should still keep control of booking repairmen yourself. It’s a hassle for the tenants to have to try to book contractors and pay for maintenance costs for your property. Treat your tenants like VIP clients and offer concierge-level service. This keeps you in control of both the quality and cost of any repairs that are done.
If you want your maintenance and repairs done right and at a decent price, it’s smarter to take care of it yourself and get your own people to handle it. That way, you can make sure everything meets your standards. If your tenant picks the contractor, you could end up stuck with shoddy work and extra expenses.
Screen Your Tenants Thoroughly To Avoid Expensive Evictions & Property Damage
My mom has a saying, “Sometimes the best deal, is the one you DON’T do.” Her point is that it’s better to have no investment property and make zero dollars, than buy a bad property that costs you thousands and thousands of dollars, unexpectedly. I have had both and learned many expensive lessons.
The same principal should apply when you are choosing tenants. It’s better to have a property vacant than to select a bad tenant who is going to have create rent collection problems or damage the property in some extreme and unexpected way. That’s the last thing you want.
While there are always the bad apples that sneak in under the radar, property management experts recommend having a professional credit and background screening done. I use TurboTenant for this on the properties I manage myself so I can make informed choices when I choose my tenants. In addition, you should have a written policy of who you are and aren’t willing to rent to (based on financial capability, credit score, rental history, criminal record, etc.). This is important for Fair Housing Compliance, and perhaps more importantly, it will prevent you from “cheating” and taking a bad tenant when you’ve had trouble finding a renter for your property.
I would much rather drop my rent by a few hundred dollars each month, charge reasonable application fees, and find a good quality tenant who loves the property and wants to stay a long time, than become desperate and take a sketchy applicant who is the only one willing to pay my above-market rents (and then goes on to skip out on rent and utilities payments).
When you invite a tenant to lease your property, make sure you both have a clear understanding of what level of upkeep you expect on the property. Help your tenant be successful and let him know what his energy bills and heating costs are likely to be so he can budget appropriately. He should get renter’s insurance to protect his personal property and be well-qualified financially to afford the rent and his other expenses.
Now, even with a good tenant, sometimes repairs pop up because your tenant messed something up. It’s not the end of the world, and it happens to the best of us, even in our own houses. If it’s the tenant’s fault, he should pay for the cost of the repair. For example if his kid flushed a GI Joe down the toilet and jammed it, he gets to pay for the plumber…
But if maintenance items just pop up… like the 20 year old stove stops working… that’s generally the landlord’s responsibility and he should cheerful pay for those items. Give your tenants respect and fair treatment, and don’t try to force every household expense on to them like Scrooge McDuck would.
Always encourage your tenants to let you know if they spot any issues or weird stuff happening. If they catch a leak early on, you could save yourself a ton of cash on water damage later!
If You’re Handy, Landlords Can Save Money By Making The Repairs Yourself
You don’t have to be a pro carpenter or plumber to tackle some simple fixes around your place. When I got started we didn’t have youtube, but we did have time, elbow grease, and how-to books for sale from Home Depot, or at the library.
A lot of common home maintenance items can be done by yourself if you’re willing to put in a bit of effort. Just make sure you know what you’re doing and feel good about your skills. Don’t take on more than you can handle, or you might end up with a bigger mess on your hands!
Landlord Tip: Consider Upgrading To Make Your Property More “Green” and Energy Efficient Over Time (But Check With Tenant First!)
But do consider improving your property over time. For example, would your tenant like to switch from incandescent lights to LED’s? Those can be expensive, but if you are replacing bulbs at a tenant turnover or in a hard-to-reach location, you can consider making the investment. Another trick that’s been popular for a while is changing the shower head to a low-flow head to conserve water. Ask your tenant if they would like these upgrades to help them save on energy costs. Not everyone prefers low water pressure or blue flashing bulbs… your so-called improvements may surprise the residents, and not in a good way!
Know The Limits Of Your Repair Skills
Most potential landlords have a good sense of their limitations when it comes to DIY projects. Know when it’s time to bring in the pros and when it’s okay to tackle a project yourself. I would say when it comes to the health of the building – like roof and siding issues – or the safety of you and your tenants – such as electrical items, it’s best to have a knowledgable person on hand.
However – lucky for you – many tasks are just about grunt labor – reducing the need to have a smart person at the helm without affecting the results. Congratulations – you qualify!
Sure, some of the landlord chores might not look super exciting, but when you see the great return on your investment, it won’t bother you as much.
Landlords have to deal with various expenses throughout their investment journey. If you can knock out repairs without breaking the bank, you’ll keep more cash in your pocket.
If you want to find out how landlords can save some bucks on repairs for their properties in Seattle, hit us up with a call or shoot us a message today! (206) 578-3438