San Francisco currently has the most expensive rental market in the country. When managed properly, rental property here can bring in a highly lucrative income for investors.
Managing a rental, however, has more than its share of challenges, especially for first-time landlords. That’s why some opt to outsource the job to a reliable San Francisco leasing agent or property manager.
Electing to hire a management firm does involve incurring fees, however, so weigh the pros and cons carefully before going this route. As a landlord, your responsibilities will include:
Handling Tenant Turnover
Property ownership can be an attractive business where investors are able to select and keep long-term tenants. Tenants that are happy are unlikely to turn over quickly, which ensures landlords of a steady and reliable income.
Providing tenants with valuable service, such as being quick to respond to requests and complaints, helps ensure that they stay. Making an effort to place other good tenants as neighbors is also a good way to encourage long-term residents.
A rigorous screening process can help weed out potentially difficult tenants. Look for desirable tenant characteristics like a good income, steady employment, high credit scores, and an excellent past rental history. Also be sure to ask for references.
Stay up to date on the city’s and the state’s landlord-tenant laws and ensure that all legal terms are included in the lease contract. Set contract start and end dates. Also, set due dates on rent, and be clear on grace periods and late fees. Unpaid rent can lead to eviction, one of the more gnarly things a property owner may have to deal with.
Maintenance and Upkeep
Maintenance is one of the primary concerns that property owners need to deal with. Upkeep is important as it can affect the living standards of tenants.
Landlords are legally responsible for maintaining health and safety standards on their property, including where and how to dispose of tenants’ garbage. Common areas should always be in good repair.
Pests and plumbing problems can become a nightmare if not dealt with quickly and tenants have the right to demand essentials like hot water and operating toilets, so property owners and managers need to have immediate access to a range of tradespeople. Building solid relationships with tradespeople who can quickly and cost effectively attend to any problems that crop up can be invaluable.
Landlords need to maintain more than the physical property itself. They also need to keep updated financial records and electronic files for all their recordkeeping. They need to invest in the appropriate technology and support systems to properly manage their financial obligations.
The property owner needs to understand the revenues generated and expenses incurred in running the rental property. To identify deductibles and reduce taxable income, it is often a good idea to hire an accountant who specializes in investment property tax law.
Need help with your San Francisco rental? Talk to a professional San Francisco property management expert. For questions on managing a property for lease in SF, let Ray Amouzandeh assist you. Call 415.494.7009 or send an email to SFHomez(at)gmail(dotted)com for more information.