Surprises are rarely a positive thing in the world of single-family rentals. This is particularly true when the surprises are brought on by unforeseen fees or charges. For the novice real estate investor in North Charleston, those unpleasant surprises are practically guaranteed. Rental property investors might be better prepared when one or more surprises arise by learning about some of the most prevalent hidden expenses.
A good quality landlord liability insurance policy is a must for every single-family rental owner. This does not necessitate purchasing the most expensive coverage out there. The cost of insurance policy rates can vary greatly, as can the quality and standing of the provider. Because of this, it’s important to compare options before selecting a landlord insurance policy and to review your pricing each year for any adjustments. unless you thoroughly examine rates and insurance carriers, you may pay far more than necessary for landlord insurance.
The property’s utility costs could present a second unpleasant surprise. The energy costs of an energy-efficient home are comparatively modest. However, prospective investors can find that their new investment home has a high energy cost. There are numerous ways in which property owners can increase the energy efficiency of their rental property, regardless of the cause. You may gain a better understanding of the potential problems if you have the house checked for air leaks, outdated appliances, and other energy “vampires.” Energy expenditures can be significantly reduced by replacing leaky areas like lightbulbs, single-pane windows, and weatherstripping. Simple improvements and yearly maintenance can drastically lower the energy costs of your rental property.
Inadvertent Appliance Damage
A real estate investor or North Charleston property manager may also be surprised by the rapid depreciation of household appliances. The cost of updating key household appliances every few years might leave any investor feeling trapped. The problem isn’t simply that the tenants are mistreating the appliances; rather, it’s that they lack knowledge about how to operate and maintain them properly. Teaching your tenants how to use and maintain their appliances is one of the greatest methods to keep them operating longer and more effectively in your rental home. You may considerably increase the life of the appliances on your property by urging people to operate them properly and carry out a few simple maintenance tasks.
Investors in rental properties for the first time could decide to have their tenants do regular cleaning and maintenance to keep unpleasant pests to a minimum. Renters might still encounter pest issues, including termites, ants, rodents, and more, even in the cleanest properties. You may need to offer pest control services from time to time, as needed by local law, to keep your property habitable. You should not only have a trusted local pest control service provider on hand, but you should also plan ahead financially for such services. If not, you risk having negative monthly cash flows due to emergency termites or other treatments.
Erosion Prevention and Repair
Every new season during the first year of rental property ownership might come with its own surprises. Sometimes erosion problems are revealed in the spring when it is warm outside. In these situations, the expense of erosion control and maintenance may deter an investor and alarm the tenants. As the earth around a home’s foundation erodes, water can collect and cause damage. The easiest method to prevent any unforeseen preventative and repair costs is to make sure that your rental property has good drainage and has been thoroughly inspected for symptoms of soil erosion.
The best single-family property owners occasionally have to pay unanticipated legal costs. Conflicts can and do arise when working with tenants, which can be challenging. Although budgeting for future litigation may be sensible, preventing a lawsuit in the first place is an even better strategy. One of the best ways to start is by performing routine property maintenance and promptly responding to repair requests. In addition, keeping yourself out of court also entails making sure your facility complies with safety regulations, offering basic safety gear, and inspecting it for hidden hazards like mold, lead paint, or asbestos. Following your lease agreement and motivating your tenant to do the same is another smart method to avoid tenant disputes and save money on legal expenses.
You may be better equipped to reduce or avoid unexpected expenses that go with owning single-family rental properties, now that you know about them. Foreseeing property maintenance, tenant education, and cost comparisons, you can better avert a good deal of surprises in real estate investing.
Real Property Management Charleston is a veteran expert when it comes to property management, making us the greatest resource for new and inexperienced property investors. Contact us today to see what we can do for you and your property!
Originally published on January 17, 2020.
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.