Are you thinking of renting over your home or investing in a rental property? While it is true that being a landlord is not for everyone, investing in rental property can be a smart way to grow your wealth.
During her guest appearance on WCNC-NBC’s Charlotte Today, Nancy Braun, owner of Carolina Property Management, shared some of the key things every first-time real estate investor and landlord should know about property management.
Nancy highlights the importance of doing everything in an orderly and systematic way in order to avoid problems later on. Most of the time, budding investors and landlords have little idea about what should be done in order to protect their investment. This is where a property manager comes in. Hiring a property manager can lighten the load and bring in more results.
When it comes to money matters, it is typical for new landlords not to make some money right from the beginning because of initial expenses. Nancy assures that it’s okay even if you just breakeven the first year. If you have a mortgage, it will stay constant for the same amount every year for 30 years while the rent typically increases. So you hold the property and in 10 years, you will be making some good money.
Should landlords have hearts or should they treat rental property solely as a business? According to Nancy, it’s a combination. She mentioned that it is important to make the tenants happy so that they take care of the property and they stay. She also emphasized how crucial it is to spell everything out in writing. Make sure all details are written out so that there’s no confusion about the tenant’s expectations.
Working with a trusted property manager can help you maximize the profit from your investments as well as maintain and increase the value of your properties. When you work with Nancy Braun and Carolina Property Management, you will actually make more money in the long term. This is because you have professionals who will assist you in getting better tenants that stay longer and you will have less damage and repairs to deal with. As a result, your rental property remains in excellent shape.
If you want more information, you can get a FREE copy of Nancy's special report, "5 Ways to Get Top Dollar on Your Rental Property." by visiting NancyHasTheTenants.com.Call Nancy Braun today at 704-488-3109 to know more about how they can help you take care of the many details of owning, renting, and managing properties.
Eugene Robinson: Well if you ever thought about renting over your home or even investing in a rental property, there are some key things you need to know about managing the property.
Colleen Odegaard: Here to help is Nancy Braun with Carolina Property Management. Nancy good morning! Thanks for being here today!
Nancy Braun: Good morning!
Colleen Odegaard: Alright, when you get into the rental property business, you really need to start off strong.
Nancy Braun: Well, everything has to be done exactly, methodically and systematized, so you don't miss something. So, many people get into the business sort of, by accident. They might just decide not to sell their home, they might keep it and they might get a tenant, and think it's all fine.
But there are so many things that they need to do to be precautionary and make sure they have expert records and systems in place. So, often now, come to someone that needs to sell their home and they're traumatized 'cause their last tenant trashed their house. And I'll be like, "Oh! Well, did you, you know, get to keep the security deposit? Did you do a move-in inspection? A move-out inspection?” And they kinda look at me like, you know, they're in headlights, "What? What should have I done?" So, a property manager's gonna really guide that and make sure that we've dot your I’s and cross your T’s.
Eugene Robinson: So as a landlord, can you expect to make some money right from the beginning?
Nancy Braun: Typically not. You might really land a great one initially but there are some initial expenses. You might have to do some cleanup or improvements to bring it up to par so it's rentable. And it's gonna cost some money to find a tenant. And it's okay even if you just breakeven the first year. The magic of it is if you have a mortgage, your mortgage is gonna stay constant for the same amount every month for 30 years. Whereas rent typically has been going up, so on an average it's been going up about 5% on a year. So you hold the property and in 10 years, you're really making some good money.
Colleen Odegaard: That's good. Okay.
Nancy Braun: And maybe less, of course.
Colleen Odegaard: Sure. Nancy let me ask you this. Should landlords have hearts or do they treat this solely as a business?
Nancy Braun: And it's a combination. It sure is, it sure is. It's a human thing so, you know we meet our new tenants at the property. We do our move-in inspection and we create a beautiful basket for them when they get there. So we just moved in a new tenant to one of our properties and he had a dog so we had dog treats in there and water and paper towels and things that they'll need when they first get to a place. Of course, they're human so we want to have them be happy. And our job as a property manager, we're really representing the owner. We don't represent the tenant, but we want the tenant to be happy so they take care of the property and they stay. So it's really important that you do handle it as they're all individuals and they all have specific needs and wants.
Eugene Robinson: How important is it to spell everything out in writing?
Nancy Braun: Oh gosh. Everything has to be. And photographs. And videos. So now we take into consideration videos and photographs and everything in writing. So initially, we'll walk through the property with the tenant, explain what the expectations are, what they should do as far as changing out the filters every month as far as making sure that the house is maintained, the landscaping, how to set the thermostat, we've had problems with that,
how to even use the disposal. And then, they can take care of the property and we have all the documents, you know when they first sign their lease. We're gonna even include the move-out inspection so that they know what is expected of them when they do move out. So, everything in writing.
Colleen Odegaard: Yes, so many details and you take care of all of that. If a tenant breaks the lease, what should a landlord do?
Nancy Braun: Well, in writing. Once again, communicate in writing and say, your nonpayment of rent, your late on rent or you've breached the lease because you're parking on the lawn. Whatever it is, get it in writing because that's what the courts are gonna wanna see.
Eugene Robinson: Well sample, my mom fell in this problem. How do you assure that the people are taking care of the place?
Nancy Braun: Well that's all involved in the, before you take on the tenant. You have to really critique the tenant. Do the credit check. Do the background check. We do landlord verifications so we're calling their past landlords and asking, "How many times has that tenant been late on their rental payment? Did they get their full security back? If not, why?", and "Would you rent to this tenant again?" So it's really checking their background, their credit history but also seeing their income verification. Do they really make what they're saying they're gonna make? So if a past landlord is happy with that tenant, they're gonna let us know. And then we're gonna able to judge whether they're gonna take care of the property 'cause you know, your mother went through that. A really traumatic situation and you lost a lot of money or she did. So all of that is in the prep but it's also in the management. After our tenant moves in, within 30 days we're gonna go inspect the property and make sure that they're living up to the lease agreement.
Colleen Odegaard: Any other reasons that someone should hire a property manager?
Nancy Braun: Well, you're gonna make more money. Most people think you're gonna do it yourself and you're gonna save money but in reality, I'm gonna get a tenant and they're quicker so you're gonna have rental income much faster and I'm gonna get a more qualified tenant most likely because I'm going through all these criteria. So, and it's the stress of it. Wasn't it horrible for your mother?
Eugene Robinson: Yeah! I was so stressful for her!
Nancy Braun: Yeah! And for you!
Eugene Robinson: Yes, and me.
Nancy Braun: So, it takes away that stress and now it's just an income-revenue generator and you're using a professional just like you would use a professional to clean your clothes or a professional to clean your teeth. You go to those that know what they're doing, and then it gets done correctly.
Colleen Odegaard: Well if you want more information, you can get a free copy of Nancy's special report, "5 Ways to Get Top Dollar on Your Rental Property." You can find it at NancyHasTheTenants.com. NancyHasTheTenants.com. And you can call Nancy directly at 704-488-3109. Again 704-488-3109. Nancy Braun, thank you very much.
Nancy Braun: Thank you.