Real estate investors see value in multifamily properties for a number of reasons. Perhaps the main benefit is that investors are able to generate rental income from multiple units. Investors also have less to worry about when one of the units becomes vacant – while the owner of a single resident home must scramble to secure a replacement tenant, investors of multifamily buildings can still collect rents from other tenants while they work to fill a vacancy.
However, there are some important considerations to make before investing in CRE’s multifamily sector. These deals entail more than just basic negotiations and contract signing — investors inevitably enter into the world of commercial property management.
Owners of large-scale multifamily properties may be inclined to hire a property management team. But if you invest in a building that houses 6-10 units, you may take it upon yourself to oversee management duties.
In order to provide additional value for property owners, our team at Investment Property Loans has compiled this list of property management tips that many successful multifamily investors employ. Be sure to follow these 4 tips to maximize profits and make the most out of your commercial investment.
1. Be Respectful of Privacy
In multifamily living situations, personal space is imperative. It’s important to have healthy interactions with tenants, but there is a fine line between ‘just enough’ and ‘too much’. Property managers need to find a balance that allows them to comfortably perform their duties without exasperating tenants.
Possible courses of action may include limiting your visiting hours or giving tenants ample notice before conducting building repairs or adjustments that may affect their day-to-day lives.
2. Consider Allowing Pets
Traditional “no pets allowed” policies may significantly limit the success you have when marketing your property to prospective tenants.
Instead of preventing renters from bringing pets into your building entirely, consider charging a higher rent price, a pet deposit, or even a pet rent fee. Not only can you increase profits, but you will likely attract more responsible tenants.
3. Take Complaints Seriously
When you commit to managing a property with multiple tenants, you must also commit to resolving their issues in a timely manner. Upon receiving a complaint, make sure you do all that you can to ensure that every affected party is accommodated.
Don’t ignore or downplay the importance of complaints. As a property owner, you need to let tenants know you take their living situation seriously and work to ensure their happiness.
Remember, your reputation is incredibly valuable as a property owner and can either attract or chase away potential tenants. Make sure you’re known as a responsible, caring, and fair manager.
4. Carefully Tend to the Property
The condition of a multifamily property directly corresponds to the tenants’ experience living there, so make the effort to keep all units clean and proficiently maintained.
It is important to remember that property maintenance extends beyond just the building itself – landscaping is a crucial component as well. Overgrown grass or dirty parking lots can create a negative impression in the minds of prospective tenants before they ever walk inside the building.
Contemporary multifamily tenants are looking for more than just a roof over their heads – they’re looking for a home that cultivates their lifestyle goals. Commit to creating an environment that makes this dream a reality.
If you’re ready to enter into the multifamily commercial sector and looking to take the first steps with financing options, reach out to one of our experts today.