The Real Reasons Your Rental Is Losing Money
November 16, 2017
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to how frequently people are choosing to lease or rent properties rather than own them. As a result, the amount of property investors is growing right alongside with the increase in renters. Surprisingly, these investors are not seeing the kind of kickback from their properties that they have initially expected or been lead to believe they should see. While you might think that landlords and property owners have strong portfolios in today’s real estate market, we’re learning more and more that isn’t the norm.
Possible Reasons for Rental Investment Loss
There are many reasons for this kind of decline, and many real estate investors might argue that it comes down to something as simple as a poor choice of location or renters not keeping up with their monthly bills. Others suggest that acting as a landlord in addition to being the primary investor is too challenging of a task to juggle. Generally speaking; however, the big reason that rental property investments seem to be failing because the investor didn’t do their due diligence in hiring a reputable management company with a success record for their type of property, or, they outright didn’t bother to hire one at all.
Misconceptions Abound
While it’s important to understand the factors involved in a successful property – as we mentioned above, poor location or irresponsible tenants – the more significant issue at hand is failing to manage the property correctly and analyze its potential within the marketplace. The property itself cannot be at fault for these factors, but rather the responsibility falls on the shoulders of its manager or management team.
Property management cannot be an afterthought, and unfortunately, far too many investors treat it as one. While an investor might think that they can handle all the nuts and bolts of property management because they have a DIY attitude and some skills to back it up, they fail to understand the intricacies of this kind of maintenance. It’s not as easy as they think it is from the outset. They often also bank on the idea that they won’t have to interact too much with their tenants because everything is in well enough shape when they offer it for lease, but any landlord knows that could not be further from the truth.
Keys to Being a Successful Real Estate Investor
Understanding the importance and the value of having a property management company on your side to not only bounce questions and ideas off of but also to learn from is arguably the most relevant key in becoming a successful real estate investor. Great tenants and great management companies go hand-in-hand and result in a very happy, profitable investor because the success of your investment depends wholly on this relationship.
If you find yourself thinking that maybe you’ve got your head a little too far underwater and you’re struggling to keep up with the maintenance and general upkeep of your property, it might be time to start considering your property management team options. With so many different companies competing to join your team and offering endless services to help your investment be a successful one, it would only be foolish to skip this step. The right fit for you is out there; you just have to go get it.