5 Tips for self-managing your rental property
Having been in property management for 8 years now, I’ve learned a few things when it comes to managing tenants.
In my experience, a number of HMO landlords tend to use a property management company, which makes complete sense! If you have ONE HMO, you could be managing the same amount of tenants as 5 single let properties. If you only have one-two single lets, it’s also a good idea to self-manage initially to understand the process, it gives you a clear outline of what you want from your property management company when you outsource (i.e 24/7 maintenance management.)
If your first property is a HMO, I would strongly advise handing over the management to a third party. (and NO I’m not just saying that because!) My reason for that is: there is a lot of compliance surrounding HMO’s, and it’s great to have a management company who’s brains you can pick to ensure your property is meeting all legal requirements for the local council.
1) Have a clear route for communication
One thing I learned when I first started out in property, was being ‘too available’ to tenants. They could (and would!) contact me on facebook, Whatsapp, twitter, instagram, email, phone, text etc… It was almost too easy for them to contact me – I was getting texts at 11pm that wasn’t really anything to do with their tenancy.
Have one-two methods of communication, and stick to it – set expectations AND if you can, set an auto responder! Here at Amplo, we use Business Whatsapp and have an auto responder that says we will get back to you within 24 hours. We also have an auto responder on our emails that points tenants in the direction of applying for a room, reporting maintenance, and other FAQ’s.
2) Reference your tenants…properly!
I cannot stress enough, reference your tenants!!
Here at Amplo, we speak with the tenant first, on whatever platform we found them on (spareroom, open rent, etc…) then conduct a phone call, and /or video call to discuss why they want to move, when they’re looking to move, and carry out other pre-qualifying questions, before arranging a viewing, and meeting them.
After the viewing, we send out a questionnaire that asks how they found the viewing, and if they would like to apply.
Our application form (as standard) then asks for;
- Photo ID
- 3 months bank statements
- 3 months payslips / proof of income
- Employee reference (or character reference from their contact at the local council if they are in receipt of benefits)
- Landlord reference (or character reference from a member of their household if living at home)
- A guarantor (if required)
- Finally, we carry out a soft credit check on either the individual or their guarantor
3) Be clever with rental rates
Do your research – throw in two weeks free rent if tenants apply by the X’th of the month, Netflix subscription, a ‘new home’ hamper etc… and do your research when it comes to how much other landlords / agents are charging in the area for deposits and rent rates.
It’s a good time to question – are you ready to become a landlord? Regardless of how responsible your tenants might initially seem, they could end up destroying your home or bringing down its overall property value. And you’ll need to be prepared to have a flexible schedule so your tenants can reach you if a toilet clogs or a pipe bursts.
Turning your home into an investment property could be a financially risky move as well. You might have to spend money to fix up the property before you can rent it out. While there are many tax breaks available to landlords, it’s best to plan on paying for expenses such as property taxes, maintenance costs and homeowners insurance. Plus, you’ll be on the hook for paying the mortgage as well if your tenant suddenly moves out and it takes time to find a replacement.
4) Carry out regular inspections
If you’re a landlord that self-manages your property or uses a let-only service from a letting agent, you should be conducting regular checks of your rental property. Property inspections are a useful way to evaluate the state of your property and how well it’s being looked after by tenants.
Rather than waiting until a tenant reports damage or a maintenance issue, it is recommended that you carry out repairs before issues mount up and damage worsens. It is a good idea to carry out bi-monthly / quarterly inspections if you have new tenancies, biannually for longer term tenancies. Set regular reminders so that you don’t forget!
You must notify the tenant in writing if you intend to visit the property, and provide at least 24 hours’ notice before doing so. While it is at your discretion how many inspections you carry out, be aware that carrying them out in excess could well be an annoyance to tenants.
5) Have communal cleaners
Being a good landlord of a House in Multiple Occupation (HMO) brings an additional set of responsibilities, which means that for renters of HMOs there is extra protection. This protection has been put into place as a result of previous situations where HMO landlords have been found to be failing at providing safe environments for their tenants to live in.
These are like little inspectors for your property! (Especially in HMO’s!) We’ve had some great reports back from our cleaners, some even include “are you sure you want us to keep coming? It’s been spotless every time we come!” Your cleaners can help build a relationship with your tenants, an opening for them to find out information about the property, get a feel for the tenants and what they’re up to!