Owning investment property can be time consuming. So much so that it can encroach and even eclipse other aspects of life. It can, at times, feel like a huge time-suck, compromising family time, leisure time, as well as time to extend and grow wealth. It doesn't have to be that way. There are ways to own investment properties, manage them effectively, and maintain their profitability, while preserving time to have a gratifying life.
Dealing with Maintenance
Maintenance is arguably the most intrusive. This is due to the nature of maintenance, which is a twofold obligation. Preventative and ongoing maintenance can be scheduled and executed by an individual or outsourced. This requires either setting time aside to do the maintenance or time working with the provider to schedule maintenance, ensuring the maintenance has been completed correctly and in a timely manner, then tracking and processing the accounting; be it to yourself or a provider. But no matter how efficient your preventative maintenance plan and accounting procedures, the second maintenance obligation is unavoidable. Emergency maintenance can surface for any property at any time. A good preventative maintenance plan can mitigate some of this, but nothing can keep lightening from blowing out a breaker panel, or a hailstorm from damaging siding. The tragic flooding in Memphis, TN in 2010 illustrate this point in striking detail. Having a great property management team on your side to keep you informed of the condition of your property and alert you to any possible problems is another part of that preventative maintenance plan. The flooding did not effect a single investment property of Memphis Invest clients, but they were kept up to date and aware of the conditions daily and that updating meant a great deal to clients in far away locations.
Managing Tenants
Tenants offer another opportunity for your investment properties to encroach on the normal course of your life. Keeping property occupied is an obstacle course not for the faint of heart. Placing ads, showing the property, doing background checks on potential tenants, keeping rental agreements current to ever-changing laws, and intelligently handling deposits are some of the initial burdens. This doesn't even take into account inspections at the end of the rental terms, hiring a cleaning crew, and returning deposits in part or whole. The monthly obligations build up quietly and slice out bits of time in small increments. Collecting rent, applying late fees as necessary, and depositing checks are unavoidable necessities for investment properties. But that doesn't mean it has to be your time that is consumed in getting these things done. Still more unfortunate circumstances occasionally arise such as eviction, removal of possessions, or the untimely demise of an otherwise perfect tenant.
Time and Property Management
What has been described here is somewhat minimal in that it does little more than keep investment properties profitable. There are other opportunity costs in doing business as described above. For example, if your time is spent keeping existing properties profitable the opportunity cost is that there is no time to expand holdings, and therefore, no time to expand wealth. Additionally, this situation implies a physical limit as to how many investment properties that can be owned and maintained. The problems may seem exasperating, but the solution is simple: engage a real estate investing company such as Memphis Invest to relieve you of these obligations so you can better pursue your lifestyle goals such as building wealth and spending more time with family.
