The number of renters is on the rise in the Fort Worth area, indicating that new investors have come to own rental properties in recent years.
Chances are, you knew that real estate was a great investment, but you may not have known what rental property ownership would entail. Rental properties need a ton of repairs, and the cost might be higher than you expected.
Rental property management can make your life as a property owner a lot easier. However, while your property management company will take care of maintenance, they won't pay out of pocket for repairs.
Read on to learn how to cover the cost of rental property damage and how a property management company can help.
Paying for Maintenance: Funds and Deposits
Property owners are required to make sure that their properties are well-maintained and up to local codes. When you hire a property manager, you retain the responsibility of paying for repairs. To cover these costs, it's important to understand to have both reserve funds and security deposits to pull from.
When to Use Reserve Funds
The majority of these repairs are expected and routine, like replacing old flooring or upgrading plumbing and electrical systems over time. If scheduled or emergency maintenance was caused by expected wear and tear, you'll need to rely on reserve funds to cover the cost.
The best way to build up reserve funds is to set aside a certain percentage of your rental income. You may need to improve your accounting to determine how much you should set aside each month.
When to Use Security Deposits
It's standard practice to ask new tenants to pay a security deposit when they sign a lease. Security deposits cover undue costs like missed rent as well as damage that violates the lease or exceeds expected wear and tear. For example, if tenants break a new appliance by using it improperly, you can cover repair or replacement costs using their security deposit.
According to Texas law, you must itemize any damages and repair costs when pulling funds from a security deposit. Tenants can challenge your use of their security deposit, so your itemization and reasoning should be airtight.
How Rental Property Management Can Help
No, property management companies don't pay for repairs. However, they take care of every other step we've mentioned here. That includes:
- Responding to tenant maintenance requests
- Scheduling routine or emergency maintenance
- Managing funds and security deposits
- Itemizing all damages paid for with security deposits
If you're looking for a stress-free way to profit off of rental properties, hiring a property management company can help.
Hire Property Management in Fort Worth
As a new property investor, you may have a lot of questions about how to tackle property repairs, from scheduling services to covering costs. A rental property management company can help.
1st Choice Property Management has been in business in Fort Worth for 30 years. Our family-owned company was built on four generations of property management experience. Contact us to get the best property management in Fort Worth.
