Bryan M. Chavis has written a wonderful book about rental investing titled ““Buy it, Rent it, PROFIT”” I am taking the liberty of quoting from the chapter on maintenance here.
“The number one reason tenants renew leases is because of good maintenance. The number one reason they leave is poor maintenance responsiveness. Maintenance is also the number one area where you can lose control of your expenses on a property over the years.”
– Bryan M. Chavis
When you consider these factors and their impact on your property’s bottom line you understand the importance of good maintenance on your property.
The important issues regarding maintenance on a rental property are: 1. Identifying tenant repairs and 2. Preventative maintenance.
Identify Tenant Repairs:
I recently did a Proforma on a property that we had managed for about 6 years. During that period of time the total maintenance costs on the property were $3,592.25. Repairs offset by charges to the tenants were $2,235.07 leaving $1,357.18 in actual maintenance cost to owner. The key here was doing a good job of identifying repairs that should be charged to the tenant whether at move out or during the term of the lease. The $1,357.18 that came out of the owner’s pocket represents about 38% of the total maintenance costs over the six years.
“I see many landlords pay for repairs that are not their responsibility. If a tenant breaks something intentionally or through carelessness or negligence, many times you can charge the tenant for the repair.”
– Bryan M. Chavis
McMath Realty promotes the idea of occasional special inspections during the term of the lease. These inspections allow the owner of the property to be aware of items that may need attention due to wear and tear. Delayed maintenance on these issues can wind up costing the owner more money if the condition worsens due to lack of attention. These special inspections promote the good will of the tenant because it allows the tenant an opportunity to tell us about items we may not have been aware of.
McMath Realty has a sister company called RW Maintenance specifically for addressing quickly and effectively maintenance issues. Having this resource available allows us to respond as quickly as possible to maintenance issues. In addition it allows McMath Realty to have a defacto inspection on the property each time a maintenance person is on the property. McMath Realty is able to stand behind and warrant the work of RW Maintenance employees, whereas we have no control of outside vendors and contractors. Thus our maintenance system saves the owner unnecessary costs and increases the return on his or her investment.
Weldon McMath – McMath Realty Property Management