If you've opted for the rental income strategy, there are many considerations that should be made to make the most of your investment and time. You may have another job or be too busy looking for your next property and not have the time to run over to see why the water heater conked out. Another option is to live in one of the units to keep an eye on your investment while the other tenants pay your expenses. That's a very nice deal.
Managing property is a 24/7 business. You never know when something will need tending. So, to fit this real estate investment comfortably into your current lifestyle, consider the following points:
Assess Your Time and Schedule for Maintenance Duties
Do you have time to run over to fix something? Do you even want to? If you're busy with work, family, or other life activities, you may not have the time to spend on your investment.
This is, primarily, a lifestyle consideration, not a cost consideration. Real estate investing doesn't require you to make major changes in your lifestyle to be extremely profitable. So, if you're making lots in rental income but you aren't spending enough quality time with your family, adjustments may be required.
Hiring a Management Company
Many investors employ a management company's services because it eliminates a lot of the headaches associated with ownership of income-producing property. In fact, it eliminates most of them.
A management company handles the middle-of-the-night phone calls. The company collects rents, interviews new tenants, provides maintenance services - in effect, becoming the landlord. Tenants don't even know you exist, and they certainly don't have your telephone number for complaint calls. Tenants deal with your management people, who, in turn, serve as intermediaries between you and the people renting from you.
Of course, there are costs associated with using a property management service, as you might expect. Typically, a management company will charge one month's rental income per year to oversee your property. So, if your building is kicking out $3200 a month, expect the management company to charge you something in that neighborhood for a year of services. Of course, you'll also have to pay for the lawn mowing service and the snowplow guy.