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Landlord Video Tip – Saving Time With Future Ads

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Rental Ad Time Saver

Inevitably you end up with a vacancy and suddenly you have to fill that vacant property again. Now you’ve got to try and find all those old pictures, remember what you wrote about in your last ad and then compile it all together again so you can start filling up your space.

Does this sound familiar? If you have multiple properties the problem compounds as you try to keep them all straight. Fortunately I have a solution for you, actually a couple solutions.

In the following video, I’ll go through how to save your time later by taking some action and being pro-active now. then after you’ve watched the video, I have an additional tip to help you out below.

As always, I love to hear any feedback you have and I also appreciate it if you can like and share the video and the post with other landlords you know. So here’s today’s video,

Was that helpful? Is it something you can implement today to help your landlord business in the future?

I talked about the creation of folders on computer as well and this is one of the best tips I can recommend to you. We have folders for each of our properties, folders for our rental forms and folders for almost every stage and type of form we use.

A quick review shows folders for each company, for rental forms, for purchase forms, for our shared accommodation properties and even for faxes/notices.  All logically broken out so we can find them quickly. Well logically to us at least.

Anyway, as per the video, when we write up our ads, we store copies of them in the appropriate folder and also the images we use for our ads. We don’t just limit it to a couple images, but keep adding as tenants and the look of the property changes so we have a range of pictures we can use.

So again I ask, have you already done something like this, or is it something you can start? My plan for the next few months is to try and add one new either video tip or post for you per week. Looking forward to any feedback you may have!

Landlord Video Tips – Set Your Rents Higher to Avoid Headaches

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Tired of getting stuck with problem tenants? Want to make sure you have more quality applicants for your vacant rental rather than trying to weed through quantity?

In today’s video tip I explain a tip that has helped us get better quality tenants who not only take better care of our properties for us, but also tend to stay longer. Two qualities than can definitely make your life as a landlord easier.

 

As always, i love to hear any feedback ou may have, so leave a comment and don’t forget to share these tips with other landlords you may know. And if you have questions, send them in and I’ll see if I can answer them in a video for you!

Out With The Old, In With The New

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Tenant Turnaround Time

One and a half hours. That was the shortest turnaround time I had between one tenant moving out and another moving into the same property. What was your shortest time?

The Secret is Preparation

It hasn’t always worked out this well for me and typically the turnaround is a day, but there is no reason it shouldn’t be a few hours or less every time. After all, the longer you are vacant, the more money is out of your pocket.

The secret to making this all work though is preparation. So, what do you need to prepare? Well obviously, you need all of your paperwork, leases, exit and entrance walk through forms and deposits paid in advance, but the catch that most landlords worry about, is the condition of the property when tenant #1 leaves.

This is where preparing well in advance pays off and is just part of another strategic system that landlords should have in their arsenal. The question for you at this point is, are you ok with sacrificing an hour now, to prepare some paperwork you can use over and over and over in the future and that allows you to turn tenants over quicker than you thought possible?

One Special Tactic

It all comes down to one extra tactic once your tenant provides notice. This tactic is simply a matter of mailing, or dropping off in person, a copy of the original lease, the walk through and one new form with the tenant, shortly after you have their notice.

The original lease points out their obligations, the walk through reiterates the condition of the property when they moved in and the new form is your ticket to happiness.

This extra form is the one you should prepare immediately and includes a list of expectations for the tenants departure. It reminds the tenant of their responsibilities by pointing to any pertinent clauses you have in your lease. Clauses such as the tenants being responsible to steam clean the carpets if you have them.

It goes over your charges for any cleanup or garbage removal you may require to complete after they move out and details costs they will incur if you have to replace any light bulbs, screens or any other minor items. It also explains that they can get their full security deposit back quite quickly if no extra work is required for cleanup on your part.

If there is significant work to get the property back to original condition this can affect the timeline of them receiving their security deposit and they need to be aware. So break this down in your form as well.

By the rules, you have to return any remaining security deposit back within ten days of them moving out, but if you require work to be done, you can also withhold approximate costs if you have a quote to get this completed and it’s always good to get high quotes, just in case!

The majority of the time though, this lights a fire under the tenants. So, as long as you check the property out a couple weeks prior to the move out, you should have a great idea how quickly the new tenants can move in!

Understanding Costs

You can charge your time out at the equivalent rate for other cleaning companies. So if you do the cleanup yourself, call a few cleaning companies in your area to determine a per hour cost for cleaning and use this in your form.

Also, when talking about costs to replace bulbs, it’s not just the cost of the bulb, but your time. So replacing a bulb isn’t $1, because that’s what it sells for at the store. It’s $5 because you had to buy it, and use your time to replace it. Explaining this and showing the tenant how it’s in their best interest could help you get your turnaround time even lower than mine!

Want To Fill Your Properties Faster?

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Then What’s Your Price Point?

fill your properties faster - advertising for tenants the smart wayWant to fill your properties faster when they’re vacant? Then take a page from Walmart.

Have you ever shopped at Walmart? I think I know the answer, but humour me.

Everywhere you look, items are priced at $19.97, $39.99, $89.97 or even $99.99. They are never priced at $20, $40, $90 or $100 and there is a reason for it.

It’s the same reason you should never advertise your unit for $1,000, $800 or $1,500. Psychologically people think of $995, $797 and $1,499 as lower numbers. Rational thought jumps out of the window and people feel it is less, even if the difference is just a few pennies or even five dollars.

This can be extremely powerful when you are trying to rent out a property, so humour me again and never rent your property out for an even dollar amount!

Bonus Tip

Here’s a quick bonus tip to help ensure your properties get found more often. If you advertise on any of the online rental sites (and I highly recommend you start if you aren’t already doing this) make sure you understand their search functions on the site.

Often the systems allow renters to search by price and you always want to be just under any cut off points. If they break the increments down by $50 it might be tougher to stand out, but if they break them into larger increments, you can make sure your rental fits in the right spot!

If the cut off points are $750, $1,000, $1,250 and increase by $250 from there, you want to fit just under those cut off points. Think $749, $999 and even $1,249. Don’t be afraid to experiment and even try $747, 997 and $1,247. Experiments have shown the number 7 included in a price actually sells better than 9!

Do You Really Understand Cashflow?

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Determining Actual Rental Cashflow

rental cashflowT to succeed and really profit as a landlord, one of the basic areas you need to understand is the cashflow your property generates and how to then budget it for future expenses or issues.

Without planning ahead like this, rookie landlords often get caught in rough situations where there simply isn’t enough money to deal with a big problem.

Here’s how a new landlord typically sees it:

Basic Monthly Cashflow

Monthly Income
Rent Upper Unit: $1,100
Rent Lower Unit: $800
Total Rent: $1,900

Monthly Expenses
Mortgage: $1,200
Taxes: $175
Insurance: $50
Total Expenses: $1,425

Total Cashflow (Income – Expenses)
$475

This is pretty typical and the $475 then goes directly into the landlords hands as profit. However, this doesn’t help you long term. Especially if you plan to expand or avoid future expenses.

To avoid falling into a trap, I’d suggest you should change your projections a bit and make it look like this (of course use your own numbers!):

Monthly Expenses
Mortgage: $1,200
Taxes: $175
Insurance: $50
Vacancy Reserve (current vacancy rate % x 2, so 10% of monthly income) $190
Repair Reserve (approximately 5-7% of monthly income) $95 (I used 5%)
Revised Total Expenses: $1,710

Actual Cashflow: $190
But Why?

So you don’t end up like the US government and have to borrow money to pay your expenses! Lack of long term planning and understanding future costs and expenses is wreaking havocs on governments and individuals throughout the world. You can do better than that.

Plan Now For The Future of  Your Property

If you plan in advance and understand you will have vacancies and also understand you will need to do repairs and that you can create reserves so money doesn’t have to come out of your pocket later, you will learn to sleep much better at night. That’s what the second example shows.

The real trick is to take those reserves you are budgeting for and move them into a separate reserve account so you don’t accidentally spend them. Once you start thinking like this you will no longer feel like you are blindsided or trapped when vacancies or repairs start coming up and it will change how you look at your properties.

Remember, Properties are not short term ATM’s, but rather long term investments.

Advanced Landlord Tip

If you have steady tenants for an extended period, this reserve can build up, so we like to put a cap of around $5,000 on a property. Once the reserves break that dollar amount, it all becomes pure cash flow again like the first example. Or……

If you are buying a new rental property, we start with a $5,000 reserve fund that we use as our cushion. That provides us with the higher cash flow right from the start. Then if we do have vacancies or repairs, we draw money out of the reserve and then revert back to the lower cash flow amount until the reserve is topped up again.

Can you see how this takes the stress out of owning property? Once you start implementing a system like this and get used to it, the pressure of having to take the first available tenant just to fill the property evaporates. It affords you more time to choose the proper tenants and doesn’t affect you directly where it hurts, in your bank account!

Is this something you are already doing? If it is great I would love to hear how it’s working for you, if it’s not, when will you be starting?