You might have found and purchased an investment rental property in a neighboring city that originally seems great—low property cost, high rent, great tenants, and only minor maintenance needed. The drive is only about 45 minutes each way, and you only plan to visit about once a month. Everything looks great, so what could possibly go wrong?
To begin with, tenants are not forever. Certainly, the usual tenant for a single-family residence will last a year and a half. People buy their own homes and move for job opportunities, and other life events can lead to tenant turnover. When your tenant leaves, you must get the property cleaned and prepared for the following tenants. You can hire experts to do this work, but at the very least, you have to drive to your rental property to evaluate what needs to be done and then do a return trip to ensure that your vendors did the work as expected. If your vendors have missed some small things, this could require additional trips on your part.
Once your property is ready, you will have to advertise it. Did you remember to take pictures when you examined your vendors’ work? If not, then you need to make another trip. Moreover, for every showing, you will need to make a trip. On average, it takes 7 to 15 showings to find a good and qualified applicant. You can try to schedule multiple showings for the same day(s). However, what may work for your schedule does not work for applicants’ schedule, and so you should plan several trips.
Once you have found a solid tenant, you need to make an extra trip for the move-in process. However, tenants usually have several follow-up requests soon after moving in, whether it is a question on how to operate the dishwasher or minute maintenance requests, so you will need to plan a handful of trips in the first few weeks after move-in.
Okay, you now have a great new tenant who pays the rent on time. Everything goes well for a few months, but then the toilet overflows. Your tenant has to be at work and is unable to meet the plumber, so there is another trip for you. No problems for a few more weeks, but then your tenant gets into an altercation with a neighbor over the weekend. There goes your Sunday. Everything is smooth for the next few weeks, then a fuse blows. Your tenant can’t find the fuse box, and the heat is off in the middle of the winter…and you get a call at 3 AM.
Although that 45-minute drive seemed easy when you first purchased the property, it’s now a drain on not only your time but your wallet as the cost of gas and wear and tear on your vehicle quickly add up. How much is your time worth? That 45-minute drive each way for all the many aspects that you will need to take care of will add up.
Buying a property in a neighboring city can be a great investment with the low purchase price, high rent, and solid tenants that you had originally anticipated. However, the time and cost of day-to-day responsibilities can turn that dream investment into a nightmare.
The professionals at Real Property Management TradeWinds can help. We will show your investment property to prospective tenants, screen applicants, handle the move-in, deal with tenant emergencies and 3 AM phone calls, and attend to maintenance issues. Furthermore, we continually attend training in tenant-landlord laws, like fair housing and evictions, and are licensed and insured to successfully manage your property in compliance with regulations and statutes.
Have you calculated the real cost of your investment rental property? To see how much time you spend and how your time commitment compares to that of other landlords, contact us online or call us at 727-400-4722 for further information.
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