ProActive Property Management

7 TIPS FOR LONG-DISTANCE LANDLORDING SUCCESS

Who is the best person to take care of your real estate investments?

YOU!

So, how does an out-of-state investor ensure their properties are being taking care of properly? Follow these seven easy techniques and you will become a PROACTIVE Property Manager just like the investors in our CashFlowCows.com network.

From my numerous years of managing realty holdings in up to five states simultaneously, I've learned the following information, which I share with my clients. I would like to also pass them on to you.

1. Choose the Best Local Manager, Even if Costs More.
Some apartment building owners choose a property manager based on their fee. They will choose the cheapest company in order to save money. Many different spiritual doctrines teach us that our true reality is often times the OPPOSITE of what it may actually appear to be.

This is also the case in the area of business. Sometimes by paying more now we actually save money in the long run. There is a popular saying I heard while growing up: "Compra barato, compra cada rato."

Translated from Spanish, this wisdom literally means: "Buy cheap, buy often."

Good property managers are worth their fee, plus some! They have a difficult job, one that is filled with constant stress. Imagine, they have to hear it from the tenants AND the owners. Tenants want new appliances, new carpet, they don't want their rent to increase and owners hate to spend money. They want income to surpass expenses and they want their rents to keep up and surpass the rate of inflation.

Great property managers are worth every penny they charge. Great property managers need to be treated with respect and should be admired and rewarded.

2. Communicate Effectively and Often
Many times, investors are hesitant to purchase long distance because they have an issue with trust. The gift of trust (it's truly a blessing to be able to let go) is a quality that may be earned through effective communication. Don't be afraid of asking questions.

Don't be afraid to call and check up on things. It's perfectly acceptable and recommended to call up every so often and check on how things are going. Just remember to be courteous enough not to call the first few days of every month as this time is usually the period where everyone is being worn thin.

I also like to get to know the staff, often the bookkeeper, assistant or receptionist can give you a quick update without even having to check in with your property manager.

An out-of-state property manager is a trusted advisor who has a fiduciary duty to serve you, just like your attorney, your financial planner, or your accountant. You therefore must feel comfortable enough to trust their judgement. If you don't have this level of confidence that I'm speaking of, perhaps you have not found the right property manager for you.

3. Have a Team or Network in Place
Make it a point to meet people when you visit your targeted investment location, initially and thereafter. When I know that one of my buildings needs some work, I schedule it when I visit so that I can meet my handymen in person. I also like to get numerous bids and meet as many locals as possible.

I enjoy socializing when I visit my targeted investment areas, I'm not one to stay holed up in my hotel room and order room service. The more people you meet, the better handle you can have on your property. If you can, I encourage people to try to attend a local real estate investing club to meet other investors. Other local investors make wonderful acquaintances as they understand the challenges and benefits of landlording

I like to be able to know a few independent people who can visit my properties within short notice and email me photographs when needed. Great people to have in your network are: Local Realtors or Brokers, inspectors, appraisers, insurance agents, and loan officers who live in the area. Local service professionals are excellent team sources. An investor should become friendly with them. (Tip: Luckily, people in these fields are always courting investors because we bring in out-of-state $$$)

4. Audit Your Property Regularly
I feel it is important to visit your property as often as possible. Once a year is great, every six months is even better. Remember: It's a tax deductible vacation!

Perhaps your investment is not in a resort location, but the money you make out of it could very well fund your true fantasy get-a-way in the near future.

I know that people who work 9-to-5 jobs may not have the extra time to audit their property, that is why I think www.CashFlowCows.com is growing so rapidly because we take regular trips to visit our own investments as well as those of our clients.

5. Emphasize Curb Appeal
Make sure your properties are kept clean. If you are going to spend any money on your properties, a portion of it should be allocated to spruce up its curb appeal. This can really make a positive difference, not only in the value of the property, but it will also attract more desirable tenants.

Clean and tidy people gravitate towards well-kept properties. You will have a lot less deferred maintenance if you keep up the quality level of your buildings because it will automatically attract a different level of renter than a property that has trash spread about the yard or displays graffiti that has not been bothered to be painted over.

6. Take Action Now, Don't Wait for Tomorrow

It's important for those interested in owning real estate to realize that they themselves must take personal responsibility for their investments. In order for a person to thrive in life and in business, one must be ProActive. You can't wait around for things to happen to YOU, you must make things happen.

If you have a vacancy, don't just wait around for it to get rented, take action. I have actually found tenants for my out-of-state properties by using the great online tool called Craigslist. The real estate portal of http://www.craigslist.com/ offers great resources for investors. Many of my investor and real estate colleagues have also located outstanding deals on this website.

The fastest way to find a tenant is through word of mouth. If your tenants are happy, they will alert their friends or family members when a unit nearby becomes available. This is why it's important to have a well-kept property. I also recommend having someone post a "For Lease" sign as soon as you know a unit will become vacant.

Another ProActive way to assisting your manager in procuring a tenant is to place a text ad in the local paper. The world wide web has really revolutionized real estate investing. You can literally find local newspapers online in virtually any corner of the globe (http://www.newspapers.com/) and place an advertisement quickly online.

When it's more challenging to fill a vacancy quickly, I resort to "Specials". My manager in Arizona recommended a "1/2 Month's Rent Off Special", which worked very well.

I also like the "Low Move-In Deposit Special" or the "Pets OK Apartment Special. Here is my ProActive Property Management Formula:

Sign + Advertisement + Craig's List + Specials = 100% Occupancy

Having all of your units fully occupied is the name of the game in the landlording business.

7. Have a Back-Up Plan
The scientific theory of entropy states that the natural order of our universe is chaos. That everything left unattended will begin to fall apart. Whatever we focus our attention on will grow, whatever we neglect will begin to demise. This theory can be seen in our every day life.

If you don't pay attention to your finances, what happens? You begin to shop needlessly or overspend compulsively. If you don't pay attention to your apartment buildings what can happen? Tenants may not pay the rent or the building will have a lot of deferred maintenance, perhaps even worse can happen.

It's important to always have back-up property managers, even if you are currently happy with the team you have, just in case.

By utilizing these tips, an investor can feel more confident when they are ready to expand their real estate portfolio by investing outside the comfort of their own backyard.

Remember: Opportunities for real estate riches can be found around the nation; in fact, around the world...

Enjoy the journey of success in real estate, until next time.

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No part of this blog may be reproduced or transmitted in any form or by any means, electronic or mechanical without prior written permission except by a member of the media who wishes to quote brief passages for inclusion in a magazine, newspaper or broadcast. The advise in this blog is solely based on personal opinion. Always seek the advise of a trusted attorney, broker, financial planner, accountant or other professional before investing in real estate.