The beginning of January is traditionally the time when people are planning their year and making their “New Year Resolutions.” While it is true that many people forget their resolutions as the year progresses, all property owners could benefit by sitting down and making a list of resolutions that would ensure the success of their investment then work to keep them. Here are ten good resolutions for landlords that can benefit their investment portfolio.
Review property insurance yearly
This is one resolution that should head the list every year and now is the perfect time to take on this task. While it is important to keep insurance current, you need to keep up with the many changes that affect it. No one wants to find out the coverage has expired or that it is inadequate.
Organize investment tax information
There is no better resolution than organizing your tax information in the beginning of the year and then maintaining records for each continuing year. Begin preparing investment records for your tax person as soon as possible.
Review Your ROI
Take the time to review your return on investment (ROI). If you know what your income and expenses are producing, it can help you plan several other resolutions listed in this article, such as a maintenance plan or possibly buying a new investment.
Develop a maintenance plan
It is unrealistic to think that investment property will not need repairs. There should be two approaches – one of preventative maintenance and that of long-term replacement. Preventative maintenance may prevent costly and unnecessary major repairs. Plan your yearly budget for minor repairs. Developing a plan for major replacement will help you budget for when they are necessary or possibly prepare for that unexpected emergency.
Review your investment portfolio
Perhaps this is the year to review selling your property and investing in another. It could also be the perfect time to buy another property if the market indicates prices are right. Be sure to consult us on the current rental market before you invest. Explore doing a 1031 exchange with a professional who knows the program.
Analyze the current tenancy
Make a call to your property manager and discuss the current tenancy periodically. It may be that a lease renewal is pending, and you may need to entice a tenant to remain in the property. It could also be time to give a tenant a notice. It is better to know what is happening in your property than have an unwelcome surprise.
Develop an emergency/disaster plan
As the last several years have shown, emergencies and disasters happen regularly. Think about what could happen to your property. Fire or flooding can happen in any property and it pays to have the right insurance and an emergency fund. If the property is in an area prone for certain problems, such as earthquake, tornadoes, and hurricanes, be realistic and be prepared.
Know and follow fair housing
If there is ever a resolution all property owners should review and keep at all times, this is it. Following Fair Housing pays off and avoids or reduces costly litigation.
Comply with lead-based paint legislation
Any property built before January 1, 1978, is subject to the laws concerning lead-based paint. You must disclose to tenants before they move in that there is a possibility of lead-based paint. Then, if repairs that relate to lead-based paint are necessary while a tenant is living in the property, you must use a qualified licensed contractor and once again, notify the tenant properly. Again, complying with this mandated legislation can mean avoiding an unnecessary lawsuit.
Never ignore mold problems
Mold has become one of the worst legal nightmares for investors. Do not ignore any mold problem. If your property manager contacts you on this issue, make a resolution to act quickly on removing any mold problem.
Does this seem like too many resolutions to keep? You have already accomplished many of them by employing professional Property Management services. We are here to help you and keep you informed on what is happening on your property and what legislation affects your investment. Have a Happy New Year and call us anytime you need assistance.