Investment Property Management
Investment property management can have three aspects to it. First, people may think of this as being a management company that manages the day to day issues that arise with running a block of flats or an estate. Or second, where an investor or potential investor requires some help deciding which properties and which types of properties to buy (see section on portfolio management). Or lastly, where you actually manage the property that you hold personally.
Investment property management to my mind relates to the third point
and this is the topic of this section. Now this is not to be confused with portfolio property management (discussed elsewhere) but this section really realtes to what to do with properties once you've bought them and it really relates to record keeping.
The goal is: buy the property and get it rented (either through an agent or directly), receive the rent, pay the mortgage, and hope that the tenant stays, and that nothing goes wrong. Great.
But What happens if things do go wrong? It is the record keeping that should keep you out of trouble. My advice is to keep a file of everything that relates to each property individually rather than filing all generic documents together.
If for example, you have 5 properties, make a file for each individual property and keep whatever relates IN ALL MATTERS to that property rather than say keep all the leases in one file and all the statements of rental income in another. The reason that this is suggested, is that every property is individual and will have a different set of 'rules' compared even if you bought the property next door in the same block. There will be different tenants for a start; perhaps you'd sell one earlier that the others and have different tax treatment on them or there's an insurance claim and so on.
Having resolved the filing method, the next is to record your letting income and expenditure and be prepared for the tax man. IPF does not advise on tax matters but does advise you to take advice from a properly qualified professional. You will save time and therefore money by filing your affairs neatly so that these can be provided easily for either your adviser or the taxman directly. There are software systems that can do this for you but what counts, is actually doing the filing!
Little things like keeping a spare set of keys, keeping a phone directory of the number of the letting agent and where possible an out of hours number too! are essential so that you can provide a great service to your tenant so that they will stay longer and treat you and your asset with respect. The little emergencies like where to find an emergency plumber, glazier, cleaner, inventory taker, electrician, white goods supplier and locksmith are invaluable. These all need to apply to the area where your properties are.
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