Things To Do For Rental Properties
By Gary Hibbert
Earlier this week I was talking to one of our investors and realized they missed an important step to our Rent to Own formula. We’ve acquired a ton of information over the last few years by following the footprints of other successful investors. Things we’ve learned and do with our eyes closed is not always clear to the beginning investor.
Below are our top 10 things to do when investing in Real Estate.
1. Deposit all your Rent Cheques. One of the strategies we use to help free up our time is to have our tenant’s give us post dated cheques for the year and hand them into the Banks. For a small fee they will automatically deposit these cheques into your account without you having to remember each and every month.
2. Visit Your Property. When investing in Rent to Own properties the maintenance is usually kept to a minimal since your tenants are responsible for minor repairs. Your tenants move in knowing they’re going to own the home in a few years and are willing to maintain your home. With that being said, it’s still important as an investor to visit your property from time to time since you still own the home.
3. Set Expectations Up Front. Set the ground rules up early and be very clear with your delivery. It’s important that they know when rent needs to be paid and if it’s not, you will officially notify them by proceeding with the eviction process. It’s important to follow this process as things can spiral out of control very fast.
4. Send Yearly Statements. At the end of the year for all of our Rent to Own properties we send year statements of all the credits they earned for paying on time. If you have tenants that have had late payments and they see what they lost out on, it helps to re-enforce the importance of paying on time.
5. Insurance. There are many insurance plans for your property. Make sure that you get the right plan and enough insurance to cover your home by talking to your Insurance agent to get the right package for you. A well designed insurance package can protect you from losses caused from fire, storms, vandalism, and personal injury and discrimination lawsuit.
6. Give Them a Gift. I’m big on this one! For each of our tenants, we give them anywhere from $50 to $100 at Christmas. Now I know this may sound like a lot but, how much of your mortgage did they pay down this year for you? After you take this into consideration, you’ll see it’s not much at all. Now if you’re not big on Christmas give them a call on their birthday, it goes a long way.
7. Keep Your Receipts. So many people get into the habit of not keeping their receipts. Trust me, you need them. Especially if you’re investing in Real Estate, there are so many things you can write off.
8. Have a Good Accountant. If you’re investing into Real Estate, make sure you have a good accountant. I could go on and on this topic alone, so I’ll save it for another newsletter. Don’t do this on your own, let your accountant focus on accounting while you focus on investing.
9. Keep an Eye on Your Accounts. No matter how good your cash-flow may be, keep an eye on our accounts. Make sure the appropriate bank fees are coming out, the taxes are right, your home insurance is correct and your cheques aren’t bouncing.
10. Take Action. For any of you that have been following me for awhile, you know I’m big on this topic. It’s important to do your homework and have a good understanding of what you’re getting yourself into. Once you’ve done that, just do it! You will make mistakes along the way, that’s normal. It’s a part of the learning process. I’ve made my share of mistakes and I’ll make more along the way but I’ve grown so much from it.
Gary Hibbert is a Canadian Real Estate investor. He uses a very smart and proven Rent to Own technique that provides a win win scenario for both the investor and the tenant. His technique of buying beautiful homes in beautiful neighbourhoods has proven to be a great concept and a strategy he share with others investors. Visit Gary and his team at http://shcinvestor.ca