Investing in property is a smart move right now. Demand for rental housing is high and the property market is on the rise once again. But whilst it might seem like easy money to buy a few properties, do them up and then let them out to tenants, it isn’t quite as easy as it first appears and if you don’t run your business properly, you could end up losing money. This article is intended to give you an oversight of what you need to run a successful property investment business, so read on for some helpful tips.
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Maintain Proper Business Accounts
You can’t run a business if you don’t keep your accounts in order. When you only have one property to manage, you might get away with recording income and expenditure on a spreadsheet, but if you have a larger portfolio, it is sensible to maintain a full set of books.
You have two choices at this point: do your own bookkeeping or outsource it to an accountant. Many small property investors do their own bookkeeping and leave the end of year accounting and tax returns to their accountant, but whatever you do, just make sure you do something!
Keep Your Paperwork Organised
Organisation is very important. If you don’t keep track of invoices and receipts, it will be very difficult to monitor cash flow and there is a real danger that you might forget to pay a bill. You will also need all of your receipts at the end of the tax year in order to offset revenue expenditure against income. A lack of organisation in this department could lead to a bigger tax bill.
Find the Right Tenants
Finding the right tenants is crucial, irrespective of whether you own condos in Montreal or apartments in Miami. Good tenants pay their rent on time and don’t trash the place, so make sure you run credit checks and conduct interviews before you hand over a tenancy agreement to a new tenant. If you don’t you could end up with a tenant from hell who refuses to move out when asked.
Have a Good Marketing Strategy
In order to find the right tenants, you need a good marketing strategy. Advertise locally if you want to attract local people, but also make use of modern advertising techniques such as social media and websites such as Craig’s List. If you don’t want the hassle of managing your properties, it might be worth utilising the services of a lettings agent. However, the cost will eat into your profit margin, so bear this in mind.
Invest in Landlord Software
Landlord software is the smart choice for property investors who prefer to adopt a ‘hands-on’ approach. There are plenty of bespoke landlord software packages out there for investors to choose from, many of which are very reasonably priced.
Investing in property is not just for experienced professionals. Anyone can give it a go and as long as you are organised and willing to learn, you, too, can have a successful property investment business.