Author: Joe Lavid of Property Management Inc. of SW Florida
I have a client "venting" his frustrations about the expense of upgrading his newly purchased duplex - a "foreclosure” that he rehabbing to get ready for tenants.
Does he have the right to vent?
The duplex purchased was for $55,000, and to get it ready for tenants he will need to spend about $3,500. The property 2 years ago sold for $240,000, overpriced maybe - but the revenue he will be receiving on the 2 units will be in excess $1300 a month.
People, who invest in these types of properties (foreclosures), do so in hopes of making good returns from them. Trying to set aside funds and budgeting is very important when dealing with a investment property. These costs include the cost of repairs, taxes, and advertising. The repair costs and taxes depend upon the age of the building and a proper provision for them has to be kept while determining the return from the realty.
Does he need a property manager? Well he resides in Europe, so definitely! For others, well the thought of dealing with tenants, preparing leases, taxes, maintenance, credit screening, annual reports, and eviction to name a few would be something to consider when taking a investment property.
Learn more about Property Management
I have a client "venting" his frustrations about the expense of upgrading his newly purchased duplex - a "foreclosure” that he rehabbing to get ready for tenants.
Does he have the right to vent?
The duplex purchased was for $55,000, and to get it ready for tenants he will need to spend about $3,500. The property 2 years ago sold for $240,000, overpriced maybe - but the revenue he will be receiving on the 2 units will be in excess $1300 a month.
People, who invest in these types of properties (foreclosures), do so in hopes of making good returns from them. Trying to set aside funds and budgeting is very important when dealing with a investment property. These costs include the cost of repairs, taxes, and advertising. The repair costs and taxes depend upon the age of the building and a proper provision for them has to be kept while determining the return from the realty.
Does he need a property manager? Well he resides in Europe, so definitely! For others, well the thought of dealing with tenants, preparing leases, taxes, maintenance, credit screening, annual reports, and eviction to name a few would be something to consider when taking a investment property.
Learn more about Property Management
1 comment:
When I hear story like this, I think of the investor who's too cheap to invest a little time and money in their properties and only thinks of them as cash cows. I guarantee you, this mentality will not make you rich but put you on the neighborhoods "slum landlord hit list". Take care of your properties and they will take care of you. Joe, I hope you told your client to find another property manager.
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