Maintaining a consistent income at a rental property is the goal of all rental property owners. In order to profit and remain lucrative in the Houston real estate industry, you’ll need plenty of experience in setting rental rates and collecting rent. To do this lawfully, you must have knowledge of all rental property policies as well as a Texas real estate broker’s license.
When it comes to setting and collecting rent, there is a lot involved. You must stay organized and on top of the money coming in and out. You’ll need to keep record of everything and have a method you use that has been proven successful when handling money. Below, are some of the responsibilities you’ll have when it comes to setting and collecting rent as a property manager.
- Determining rental rates- You’ll need knowledge of the local real estate market. Drawing comparables is how rental rates are determined. You’ll need to compare your rental units to those in the area also for rent. Then, based on your research and the condition of your rental, come up with a monthly rate that is sufficient. As a rule of thumb, it shouldn’t take longer than a month to rent out a vacant unit.
- Perform rental rate evaluations- At least once a year; the monthly rate of vacant rentals should be reconsidered. After lease renewals and vacancies, determine if you should raise or alter the rate of the unit for lease.
- Collecting rent- Instead of processing checks every month, consider a better way to collect rent. Most property management professionals will use online management software that allows tenants to pay rent online. This eliminates excuses and late or missing rent payments
- Have a system for dealing with late and delinquent payments- You must enforce the lease and anything it says about late or missed rent payments. Letting a tenant get away with late payments will only encourage them to pay later and later. You must remain strict in rent collection. Rent should always be collected at the first of the month with a 3 to 5 day grace period set.
- Determine late fees- Set a rate for late fees and administer this late fee whenever necessary. Charging late fees for rent paid after the grace period is a great way to stop tenants from paying late.
- Handling evictions- Handling evictions right away is the best thing you can do. When you have a disorderly tenant, get the eviction process started as soon as possible. The longer you hang on to a tenant unwilling to pay, the more money you’re bound to lose out on. Handle vacancies with the same quickness. Get them clean and ready to show as soon as a tenant moves out.