From massive investment firms to average Joes trying to make a bit of extra money, there are millions of individuals and institutions trying to generate revenue and value from renting other properties.
As a landlord, you can hypothetically make money passively, effectively utilizing an existing property to collect rent and benefit from ongoing appreciation.
Unfortunately, the “passive” nature of investing in rental property is a bit overstated. In fact, many landlords find themselves quickly buried with work, such as finding new tenants for unoccupied properties or addressing complaints and concerns.
What are the best ways to increase your productivity and save time as a landlord?
The Passive Problem
There’s a big problem with labeling rental property management as a passive income source: it’s not totally passive. As a landlord, you’re required to spend time searching for properties, managing purchases, marketing and advertising your units, screening tenants, approving tenants, handling maintenance and repairs, dealing with complaints and requests, collecting payments, and even managing evictions. Even in a hypothetically “ideal” property, you can spend hours every week on these (and other) responsibilities.
The All-in-One Solution
If you’re looking for a shortcut, there is an all-in-one solution that can help you navigate this problem: hiring a property management company. If you hire a local team of property managers, you can have them handle nearly all the responsibilities associated with being a landlord, all for a small, fixed percentage of the gross monthly rent you generate.
For example, a Houston property management company might be able to step in on your behalf, taking care of everything from initial unit marketing to rent collection and maintenance scheduling. They may even be able to provide you with strategic advice for new property acquisitions or high-level management decisions.
The downside of this approach is that it’s going to eat into your profitability – but probably not by as much as you think. Paying a small management fee could help you save dozens, or even hundreds of hours a year. If you have a full-time job or other projects to take care of, this is likely the ideal path forward for you.
Little Ways to Save Time as a Landlord
If you choose not to hire a property management firm, or if there are some responsibilities you want to retain control of, these are some strategies that can help you save time as a landlord:
1. Buy properties in better condition. One of the most important things you can do is buy properties that are already in better condition. As a landlord, one of your biggest sources of time loss is going to be dealing with repairs and emergencies; you’ll be required to field requests, evaluate those requests, find contractors, schedule repairs, and follow up on everything. But if your property is in better condition, you’ll have fewer requests to deal with. Buying properties in better condition usually means you’ll have to pay more; these properties tend to be newer and better cared for, and that comes with a price. Still, these properties tend to retain their value more consistently and save you hours of time, so it’s probably worth the extra cost.
2. Fix and tenant-proof whatever you can. Before you even market your property to a new tenant, take the time to fix and tenant-proof whatever you can within the unit. Anticipate what your tenants are going to dislike or complain about and take care of it proactively, so you don’t have to deal with painful back-and-forth communication. Additionally, it’s a good idea to make upgrades or replacements that reduce the amount of potential damage that your tenants can do; even something simple, like investing in more durable cabinets, can save you time-consuming issues in the future.
3. Screen your tenants thoroughly. Some landlords are tempted to speed through tenant screening in an effort to save time, but this is counterproductive. It’s much more valuable to screen your tenants thoroughly. This is going to cost you more time upfront, but it’s going to save you time in the long run; with better tenants, you’ll spend less time chasing down rent payments, you’ll have fewer issues to deal with, and you’ll likely have lower tenant turnover.
4. Automate rent payments and reminders. You should already know how valuable automation is. Automation allows you to completely eliminate some manual effort, replacing it with an automated algorithm that does it on your behalf. In addition to saving you time, automation also improves consistency, potentially reducing the prevalence of certain issues in the future. You should automate everything that you can within the realm of rental property management, including rent payments and reminders for tenants. The more you automate, the better – and there are many software platforms that can help you do this.
5. Standardize paint colors, light fixtures, and similar features. If you manage multiple units, it’s a good idea to standardize paint colors, light fixtures, and other things that you use in those units. That way, whenever you have a light bulb outage, paint blemishes to touch up, or fixtures to replace, you can turn to the same bank of products to do the work.
6. Landscape strategically. Consider your landscaping carefully, as you’ll likely spend many hours on landscaping no matter what. The more space you pave over with walking paths and patios, the less you’ll have to mow in the future. And if you use native plant species, you’ll have to spend less effort maintaining and making adjustments to the environment. Avoid plant species that require frequent trimming or modification.
7. Streamline communication. Communication can cost you a lot of time if you aren’t careful, so streamline it to the extent you can. Make sure tenants have a clear, easy to use system for getting in touch with you, such as creating a ticket in a shared portal or even just texting you directly. The more consistent your processes are, the less time you’re likely to waste in this area.
8. Respond to concerns quickly. Next, respond to any tenant concerns and questions as quickly as possible. If there’s a serious issue with the unit, taking care of it quickly is likely to mitigate any further complications. If the concern is mild, you can address it immediately and cross it off your to-do list. And even if it takes time to address this issue, you can make your tenant happier by acknowledging their request and letting them know the next steps.
9. Build a reliable network of contacts. This is another strategy that requires an upfront investment of time, but it’s more than worth it: build a reliable network of contractors and handymen you can rely on in a pinch. This way, whenever something goes wrong with your property, you’ll have multiple people you can call to address it. With a big enough network, this will help you save both time and money.
10. Inspect annually (at least). At least annually, you should spend some time at the property, inspecting it for damage and identifying any maintenance or repair concerns. Even if you have to hire someone to conduct the inspection on your behalf, you won’t spend much money; inspections are only a few hundred dollars for most types of properties, and if you find a good inspector, you’ll see incredible value from the effort. If and when you find issues, take care of them proactively so you don’t eventually have to deal with a time-consuming emergency.
11. Get your paperwork organized. Being a landlord involves a lot of paperwork. You’re responsible for tracking rent payments, expenses, and various issues associated with your property, so it’s important to stay organized with your paperwork. There are many systems of organization worth considering; what’s important is that you use one consistently.
12. Know how to delegate. You’re not going to be able to do everything yourself. That’s why the most productive landlords are ones who have mastered the art of delegation. You may not want to hire a fully dedicated property management firm to work on your behalf, but you should have managers and assistants ready to help you when necessary.
13. Compartmentalize your day. Break your day up into chunks so you can focus productively and accomplish your most important objectives in order. For example, you might have an hour of your day dedicated to catching up on emails and voicemail messages, and another hour of your day dedicated to “heads-down” work with no interruptions or external communication.
Whether you choose to hire a property management company to hire everything on your behalf or you take advantage of the many time-saving strategies we’ve already listed, this guide should help you save time and get more done in your rental property management.
Being a landlord isn’t for everybody, but for productive people who can stay focused and organized, it’s an excellent opportunity to make extra money.
