As a landlord, you’re in the game of generating cash on your cash. In other words, you’re in the ROI business. But are you really doing everything you can to set yourself up for maximum returns? This a question that you need to analyze through a critical lens.
You might consider yourself a fairly savvy person when it comes to finances and investing. (After all, you’re wise enough to invest in an income producing property.) But it’s entirely possible that you’re bleeding money in areas where you could be doing better.
1) Overpaying for Insurance
Insurance is another area where landlords often waste money. And because these payments are usually “out of sight, out of mind,” it’s easy to forget about them. But if you’re willing to take the time to shop around, you could save hundreds of dollars every year.
When shopping for insurance, make sure you’re comparing apples to apples. You need adequate coverage with the right terms. (Proper insurance coverage should, at a bare minimum, account for property insurance and liability insurance.)
2) Paying Utility Bills
If you’re paying all of the utility bills at your rental properties, you might want to reconsider. When you cover the electric, gas, and water bills, you’re basically giving tenants free rein to use as much of it as they want. After all, they don’t have to foot the bill!
While every market has its own standard practices, consider what would happen if you required tenants to pay the bills in their names. Or, at the very least, what would happen if you mandated tenants pay 50 percent of all utilities? You’d probably see smarter usage.
3) Failing to Work With an Accountant
We’re living in a day and age where you can do your own taxes with a few clicks and swipes on an app. But think twice before doing your taxes on your own. Though an accountant will cost you money, they more than make up for it in the value they return.
A CPA has a thorough understanding of tax law and can easily find tax deductions that you were never aware of. They can also make sure you aren’t breaking any laws or rules (which could cost you thousands of dollars in the future).
4) Doing Everything on Your Own
It’s easy to fall into the DIY trap where you attempt to do everything yourself. Whether it’s a leaky toilet, a lawn that needs to be mowed, rent that needs to be collected, or an eviction, your decision to absorb all responsibilities isn’t saving you – it’s costing you.
Yes, you might be able to save a few bucks on any one of these tasks, but that’s only one side of the coin. You also have to consider what you’re costing yourself in (a) time, and (b) lack of expertise. Hiring a property management service may generate a higher ROI.
If you are looking to hire a Property Management company to manage your property then consider hiring ACCL Property Management. For free consultation, please email us at firstname.lastname@example.org or call us at 905-432-8961