There’s probably one thing you dread more than any other as a property investor.
Vacancies.
Because the minute your property is empty your money stops coming in.
And when your property is empty you still have to pay:
Standing charges for utilities such as electricity and water
Property taxes
Your insurance premium
Your property management company to advertise for, screen and place a new tenant
On top of that, you will probably have to spend money sprucing-up your property to attract new tenants.
And it will certainly need a deep clean before they move in.
The truth is vacancies can cost you a lot of money.
But there is something even worse waiting for you – if you’re not careful.
You see, I’m always getting emails from people who are having trouble with their rental properties.
Take Mike in the UK for example, who wrote…
“In December I banked a grand total of US$ 750 from 5 properties, so not very happy to say the least.”
Or Riaz from Bahrain…
“I bought the house and at that time there was a tenant paying US$ 925 a month. Within 2 months the tenant went into default. I had to pay eviction charges and to find a new tenant. The only new tenant the management company can find will pay US$ 550 a month, which is much less.”
Or Simon in France…
“I bought a property from another agency. I’ve been waiting 5 months and no rent yet! Fingers crossed I will have some soon.”
You really shouldn’t have to keep your fingers crossed for rental income.
With a true turn-key property (managed by the right people) your rent should flow in every month without fail.
And you should get paid from the day you take ownership.
No ifs. No buts.
Yes, you will have some vacant periods.
But these should be short and rare as long as you buy the right house in the right area.
Why do I get so many people writing to me about their problems?
Because there are lots of people selling rental properties who promise the Earth.
But once you’ve paid your money they really don’t care what happens.
In many cases they will promise you a huge yield on a cheap house.
But instead of putting money in your pocket every month.
It will end up costing you money to own it.
When you buy a property from us you won’t wait 5 or 6 months to start getting your rent.
You get your rental income straight away.
What’s more, the properties under our management in Detroit had an average vacancy rate under 3% over the past 5 years.
And tenants stay for 3 years on average.
But I know what you’re thinking…
How can you be sure you’re not going to be left in the lurch like Mike, Riaz and Simon?
So let me tell you a few of the things we do to minimise your vacancies.
1. Thorough tenant screening = lower vacancies
The first thing we do when we buy a property is evict the current tenant.
You probably think that sounds crazy.
Or maybe even a little bit harsh.
After all, if there’s a tenant already surely it makes sense to hang on to them?
The problem is we don’t know their history.
And we are not prepared to risk passing bad tenants on to you.
So it’s out with the old and in with the new.
For your investment to be a success you need tenants who pay their rent on time and take care of your property.
If they don’t it can cost you a lot of money.
That’s why proper tenant screening is so important.
But you’d be surprised how many companies don’t bother to do it.
There are simple checks your management company can do online.
These include making sure your tenant has:
No criminal record
A decent credit rating
No previous evictions
Which is all very useful.
But it doesn’t tell you what a tenant is really like.
To find out you need to interview them face-to-face.
It doesn’t matter if your tenants are Section 8 or working professionals.
For us, proper screening is essential.
But we don’t invite them to our offices.
We visit them in their own home.
So we can see if they are looking after it.
We ask their current landlord if he has had any problems with payments or damage.
And only when we are completely satisfied does the tenant get offered a lease.
2. Charge the right rent
It is vital you set your rent at a competitive level.
In fact, it’s the only way you will keep the same tenants for a long time.
Because if you don’t they’ll probably look for something cheaper.
So we make it our business to know the market rent for every property we manage.
But this doesn’t mean you will get a lower rent than you expect.
In fact, the rent we quote you is the minimum you will receive.
And with Section 8 properties we can often get you a rent way above the market level.
3. Keep your tenants happy
Once you have a good tenant it’s important you keep them happy.
And the best way to do that is to make sure you carry-out urgent repairs quickly.
You see, problems with tenants usually start because your management company doesn’t fix stuff fast enough.
So they often withhold their rent and eventually leave.
It happened to Lesley in Hong Kong who wrote…
“I‘m having trouble with my rental company they don’t do anything they say. They did not inform me my tenant was not paying her rent even when I asked why rents were not going in to my bank. Now I find out she’s still waiting for repairs they should have done months ago.”
How do we make sure your repairs get done fast?
Your tenants have an emergency maintenance number.
They can call it 24 hours a day, 7 days a week, 365 days a year.
And they don’t just get a recorded message like most management companies.
There is always someone available for them day and night.
Their call is logged and an engineer will fix the problem within 24 hours.
This keeps your tenants happy.
And they won’t forget the good service they received.
So when the time comes to renew their lease they are more likely to stay.
4. Keep your property in good condition
It’s also vital you keep your property in good condition.
That’s why we do a full inspection of your property every 3 months.
It also helps to keep your tenants on their toes.
After all, they’re more likely to look after your property if they know someone is coming to check.
If a repair needs doing we use our own contractors.
They’ll be familiar with your property as they work on all our renovations.
So if you have a problem they can fix it fast.
It also means you get the work done at cost price.
And don’t forget you get a free 12 month home warranty on every property you buy.
Sadly vacancies are a fact of life for property investors.
But with good tenants and the right management you can keep them to a minimum.
So if you’d like a full list of investment properties in Detroit – just reply to me.
Let’s have a quick look at a few that are available right now.
This one is on Penrod Avenue in Grandmont…
It’s a 5 minute walk to Dossin Elementary School.
The house has 3 bedrooms, 1 bathroom, a living room and a separate kitchen.
There’s also a 600 sq. ft. basement and a 4,356 sq. ft. garden.
Your tenants are a husband and wife with 2 children aged 5 and 8.
Their rent is US$ 750 per month.
This property is on sale for US$ 43,000.
Your yield is 16.74% net.
That’s US$ 7,200 in your hand every year.
Want to know more?
Simply reply to me.
This place is on Ashton Avenue in North Rosedale Park…
It’s a 5 minute walk to Wayne County Community College and Eastern University.
The house has 3 bedrooms, 1 bathroom, a living room, a kitchen, a 672 sq. ft. basement and a 5,227 sq. ft. garden.
Your tenants are a family with 2 children aged 7 and 11.
Their monthly rent is US$ 800.
This property is on offer for US$ 47,260.
Your net yield is 16.38%.
That’s US$ 7,740 in your bank account every year.
Want full details?
Just reply to me.
This last one is on Williams Street in Dearborn Heights…
It’s a 5 minute drive to the University of Michigan Dearborn Campus and Henry Ford College.
The house has 3 bedrooms, 1 bathroom, a living room and a kitchen.
There’s also a 600 sq. ft. basement and a 5,610 sq. ft. garden.
Your tenant is a lecturer at the University of Michigan.
His rent is US$ 750 per month.
This property is on sale for US$ 43,904.
Your net return is 16.40% – after all expenses.
That’s US$ 7,200 in your pocket every year.
If you’d like to know more – simply reply to me.
Remember all our USA investment properties are:
Fully renovated – average cost of works US$ 20,000
Already tenanted with pre-screened tenants – you get paid from day one
Professionally managed – your rent is paid on time into your own bank account
Plus, with our Detroit properties you get all this free:
Free Title Insurance – value US$ 499
Free 1 year Property Insurance – value US$ 495
Free 12 month Home Warranty – value US$ 700
Total value = US$ 1,694.
And unlike many of our competitors we don’t charge you a finder’s fee.
In fact, we don’t charge you any fees at all.
If you’d like full details of what’s on offer in Detroit – just reply to me.
Best,
Rebecca