So you’ve done it. You’ve purchased your first rental property. All of the experts tell you that real estate investing is a great way to build wealth. Not only for yourself, but for future generations! You feel good about it, and you should! You’ve taken the experts’ advice now and are on the way to the promised land.
As real estate investors we are constantly looking for how we may better maximize the return on our investment. At Frank Moore & Company, LLC we examined the various aspects involved managing rental property and have identified the vacancy rate as a leading indicator of an investment's performance. Vacancy, with its accompanying expenses, may be the single most critical event that compromises the annual return on a rental property. Keeping good tenants in place for longer periods of time will undoubtedly increase the performance of that investment! To serve our investment community we would like to share three key areas that affect your tenant retention.
We often think of our real estate and even our valuable personal property as assets, and of course we should. But let’s consider a refined definition of an asset, as taught by Robert Kiyosaki of Rich Dad Poor Dad fame. In his writings, he defines an asset as something that puts money in the owner’s pocket. This definition is especially pertinent in the world of real estate investing.
At our company we take a position that may challenge the philosophy of many management companies. Our tenant, our customer, is an asset. We look at each rental property as a small business and no business is truly successful without loyal and happy customers. When our tenants are valued, happy, well served, and long term customers, our Clients are also well served with the best possible performance of their property investment. Caring for our tenants and delivering top shelf service, an often neglected but vital task, is one of our top priorities. While we always put our Clients’ best interests first, we also believe that caring for our tenant must always be a priority for us.
Anyone who has been in the rental business for a season or two will recognize that even a routine vacancy/turnover can wreck the annual cash flow report. Just the lost time between tenants and the necessary turn around expenses can often mean thousands of dollars lost. To make the property ready to compete in the market place costs more than to maintain under a continuing residency. Even worse, bad tenants or poorly maintained properties can constitute an enormous turn around expense when the vacancy occurs. Our goal is to do everything in our power to retain each tenant, uninterrupted for as long as possible. We even incentivize our managers to work toward long term tenancies through lease renewals and long term leases. We are determined to build the best possible relationships with our customers. It begins with efforts to attract and select responsible tenants. Our mission then is to offer a “hotel ready” home in the beginning and to provide follow up service as needed to deal with maintenance issues quickly and properly. These practices help us show our customers that they are valued and respected and also help us avoid the buildup of deferred maintenance issues in the property.
We consider it a win on all fronts to have happy customers and to run our business in a way that serves our Clients’ best interest. Properties are well maintained and customers are happy and hopefully remaining in a home they enjoy. They are pleased with us today and tend to spread the word, which benefits us and our clients now and also in the future.
The Online Portal experience with Frank Moore & Company gives our tenants unique access to their account. They can pay their rent online (free of charge), submit maintenance requests, and access key documents such as leases. Below you will find a helpful video that highlights all of the features offered by the Online Portal.
I am often asked why I am in the business of real estate...
- First of all, Real Estate is familiar. We all live in a home and the basic maintenance and operational issues are things we already know a great deal about. Educating ourselves about other alternative investments like stocks, bonds, life insurance, etc. can feel overwhelming, but building on our real estate knowledge is a simple next step.
There are several items that are considered when evaluating potential renters. We try our best to gather as much information as possible so that we may make the most accurate and fair evaluation of an applying tenant. Upon submitting an application, the following are examined to determine whether or not a person is qualified to rent one of our properties: