How to Avoid These Seven Cash Killers for Investment Properties Waterville ME

1. Holding out for a “home run” deal

If your home is worth $1,295 in the current market, you can waste months chasing $1,395. How many mortgage payments are you willing to make trying to get a “home run”? Home runs can backfire on you too. Tenants have a knack for finding out they could have had the home next door $100 less every month. When your tenant knows they are in a great rental home at a fair price, it shows in the way they care for the home and how long they stay.

2. Waiting to get repairs done

“I will paint the house if it doesn’t rent in a couple of weeks”. Sound good? This is a really bad idea! You should always be thinking of the tenant your home will attract.  If your home isn’t in optimal shape to attract the very best tenants in your specific market area, you will only get tenants who don’t care what their home looks like. You may get the home rented without the cost of the repair, but it may not be the tenant you want in your home for the next 12 months. If you end up doing the work in a couple of weeks… all you did is extend your vacancy and waste more money!

3. Ineffective marketing

A simple line ad in the paper may be the quick end to your vacancy. Be careful though - most consumers depend on the internet and our best applicants now come through online ads. You have to track your efforts to see what media produces the best (not always the most) calls per dollar spent. A “free” ad can cost you days or months of vacancies if it keeps you from finding the best tenants.

Whether you choose paper or online ads, you must have a well-written ad to get the phone to ring. You also have to be priced right, and have the home available to rent. If you aren’t getting any calls, it is usually about price. If you are too high, most people won’t even take a look. If you are getting plenty of lookers but no takers, check the home out to figure out what is turning people away.

When you hire an experienced property manager, you are buying into their proven systems for marketing and leasing your home, which eliminates the guesswork. If you decide to “save money” and lease the home yourself, be ready to commit serious time to your education and expect the process to take longer.

4. Using an inexperienced agent

There are many reasons to use a leasing agent, but if your agent isn’t experienced, there isn’t much benefit at all. In any major markets, there are literally thousands of real estate agents who want a commission, but very few with enough property management and leasing experience to make them a good choice. Be prepared to do your own ads, applications, and tenant screening if you plan to lease your home yourself, or through the help of an inex...

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