If you have savings that are ready to be invested in a new business or you have received some great money and you are thinking about what to do next, a big dilemma is in front of you. We always try to invest money in a business that will be profitable without much effort. And, of course, it will cross your mind that you need to buy an apartment or business space that you will rent. This really sounds great: buy a property, rent it and have a secure monthly income. For more details check mynd.co and find out more services they offered.
At first glance, everything really looks so straightforward. However, anyone who has experience with renting an apartment knows that things are not that simple. Precisely because of the various complications that can occur, a good part of the owners of rental space decide on an agency that will mediate in all this. Especially if they have several objects to be rented. This is how the agency deals with additional issues and problems of tenants, and you pay a percentage in return. However, that percentage is not at all naive, and if your apartment is too small, and consequently a lower rent, very often this kind of business does not pay off.
The idea is that they can save that percentage, and that renting is not a demanding job, a certain owner decides to rent the property on his own. Of course, this job depends primarily on the property itself that is being rented, but also on the luck factor of what kind of tenant you will find. We were in a dilemma whether it is better to do this job alone or hire an agency, so we bring you the 3 pros and cons of DIY rental property management
Pros of DIY rental property management:
1. All the control is only in your hands
If you decide to work independently, you will have complete control over the hiring process itself. What does that mean? In the first place, you will have the opportunity to choose and set payment deadlines. After that, you are the only one who decides when the space will need renovation and how often maintenance will be done. You are the only one who has access to money and you decide how much you will spend on maintenance or advertising or even savings.
2. You don’t give a percentage to anyone
The agencies that would run this business for you will charge you a minimum of 10% of the total rental price. If you do decide to do this job yourself, then it is clear to you that this 10% or more remains on your desk. If you take into account how much money it is for the whole year, it will be clear to you that it is not a small amount and that you could leave that money and invest it in the maintenance and improvement of your space.
3. Invaluable experience
No one was born a scientist. On the other hand, regardless of whether you have managerial knowledge or experience, if you have not done this job before, many surprises await you. You still have a lot to learn. Everyone thinks that this process is simple and does not require a lot of knowledge. But you will be surprised. So, if you are embarking on this story, be prepared to learn and be patient. You will certainly make several mistakes at the beginning, but this is not something that cannot be corrected, so learn slowly.
Cons of DIY rental property management:
1. This job takes more time than you think
The moment you decide to do the renting yourself, it certainly goes through your head that you need one day when the rent is taken and maybe another day or two when the light bulb breaks or something like that. There would be too little work to be said. However, things are a little different. You will need to be available to your tenants a good portion of the time. You will be surprised how often they will have certain requirements, especially when it comes to facility maintenance. Another big problem that can take you a lot of time is the race for rent. Not every tenant is in order when it comes to payment, even if the contract defines the dates. Be prepared to chase after your rent, which will take a lot of time and energy.
2. Lack of experience in selecting clients
People who rent space on their own mostly give it to the first interested person without much calculation. This can be a very big risk because they do not have defined criteria based on which they will make a selection. Unlike them, serious agency houses have a list of interested clients, but also a list of criteria according to which they will choose the safest tenant. That list includes, among other things, his employment history, credit results, history and the like. This can save you a lot of trouble that you are not even aware of if you do not have previous experience with publishing. But don’t let that discourage you, you could always learn more about this process.
3. You will need to study hard legal regulations
When you set out on this independent story, it may not even occur to you that you will have to deal with legal regulations and rules on your own. You have obligations such as drawing up a lease agreement. This contract must be precise, following the latest legal regulations. You will have to make up for everything you miss in that contract. If you are not specific, you will not have time to collect possible damages and complications.
Now that you have the advantages and fewer DIY rentals in front of your eyes, it is a serious homework task. Arrange everything in your head and think well. Be honest with yourself and openly consider whether you are really the person who can do all this. To make your job easier, there are many publishing software, but they require learning and upgrading again, and they are not too cheap. If you think you can do everything, get stuck and we wish you all the best. If, however, you think you do not have enough time for all this or shooting, leave everything in the hands of professionals, and if you have to give up a certain percentage.