Property owners invest in real estate for profit. With effective property management, owners can earn a good return from one property or from a portfolio of properties. However, a certain property may have been acquired for an upgrade, to produce income later, or intended for future sale for a capital gain. Either way, the investment must be managed, considered, and watched at all times. If the owner and property manager are taking care of business, there may be ways to increase the income and the value.
Owners of portfolios of stocks and bonds meet with or call their stock broker often. It makes sense for real estate investors also to meet with their property manager quarterly or bi-annually. Exchanging ideas with the professionals who have the daily pulse of the real estate market can be profitable. At each meeting, the investor can plan on finding out the current market conditions that will have an effect on equities that are owned or that can be acquired.
The following are some questions and useful topics that can be discussed:
- Are there ways that the management of the properties be improved? Can any current expenses be decreased?
- How do our rent levels compare with the others in the immediate area?
- Have there been collection problems–are all rents current at this time?
- Is the current maintenance of the properties up to the best standards?
- Has the planning department approved any zoning variances in the areas of my properties? Would it enhance the value of any property in the portfolio to apply for a change in zoning?
- Have any new construction projects been started nearby? What are they and what effect might they have on my properties or rents in the area?
- Is the present use of the properties the highest and best use?
- Could improvements be made that would increase the income?
- Are we attracting the kind of tenants that should be in this type of property? Would anyone else be more desirable?
When each of the questions has been covered, both the property owner and property management team will have a much better picture of the property and what needs be accomplished. This gives a result for the owner that is seldom achieved by many investment real estate owners. At all times, there is a definite effort being made by a top property management team to improve the owner’s position.