Apartment investors purchase property with the goal of generating income. There are two sides to income generation for an investment property. First, the owner can take a share of the annual operating profit generated by the investment, and second, the owner may profit from increasing the market value of the property beyond inflation alone.
Increasing the income generation and market value of a rental property requires a certain level of know-how, an understanding of market values and excellent management skills.
Management and Income
Professional property management is key to increasing and maintaining investment profits. Property management services include rent collection, routine inspections, repairs and maintenance, leasing, budgeting, financial reporting and more. All of this requires “hands-on” experience in the field and the latest in property management technology to optimize convenience for tenants and streamline communications.
Investment Property Valuation
The valuation of a rental property is based directly on the cash return, therefore adding value means increasing cash flow.
When evaluating apartment properties, professional property managers can help in two ways:
First, using a property manager to assist in the evaluation of a property prior to purchase can put you in a position to move quickly before other buyers have a chance to evaluate the investment. Property managers can inspect a property to inform you of the current fair market rental rates and a property’s fair market value based upon the current property condition. They can also advise you of any refurbishments or maintenance items that can attract higher quality tenants, as well as any safety issues you may need to consider in relation to risk management.
Secondly, property managers can assist in the due diligence process by performing lease file audits, review financial reports, coordinate physical property inspection, assess deferred maintenance and determine if capital improvements are necessary, provide a local market survey and assess current property operations. A feasibility analysis can measure the ability to add value. There may be many other measures that must be taken into consideration, such as, applications for new zoning, design and construction planning and a plan for marketing. A skilled property manager can assist with all of these. Their day-to-day experience in the market makes them experts that can quickly and efficiently provide insight into investment properties.
Contact Caton Property Management to maximize your apartment investment property today!