Rental Property Management – It Will Make Or Break Your Rental Property Investment Business

Don’t get freaked out about the term “rental property management”, it sounds threatening but all it really means is:

A game plan to keep your rentals headache free, cash flow animal .

Does that sound a little better than rental property management?

You better believe it does and guess what. Managing rental apartments is simply a matter of having the proper mind set and doing some planning in advance.

I don’t care if your talking about one two family property, a six unit property or twenty rental properties, having a game plan for managing your rental units is key!

Before I go any further, you should know that I always manage my own rental units. The most I ever had was I believe 42 units comprised of 2-6 unit buildings. I would never have an outside property management company manage my properties. It costs too much, they do a lousy job in my experience and its easy to get ripped off. I knew a roofer who had a gig set up, where he would give a kick back to the guy in charge of getting bids for a property management company!

Learning whats involved ahead of time for managing rental houses will save you a lot of time and aggravation.

Your rental property management plan has to cover:

  • Who is going to do the basic maintenance repairs,i.e. clogged sink or toilet, broken facet, doorknob ,window, electrical plug not working, etc. Are you going to do any basic maintenance? If not, you’ll want to find handymen that won’t break the bank. How do you find these guys?
  • Will you be able to financially handle more severe problem, such as roof leaking, need to replace a hot water tank, need new furnace, vacancies…
  • How to screen tenants. After all, they are the source of your profit center.
  • How to manage your tenants so that their personal/financial problems are not your concern.
  • When someone moves out or you evict someone, who is going to prep the apartment for the next tenant.
  • Speaking of evictions, do you know how to do one? How much does it cost? How long does it take?
  • How to adapt the proper mindset for successfully owning rental property.

You have to have a property management plan that works for you. This is key. You see, some people are white collar, some are blue collar, some are hands on, some can’t and don’t want to know how to turn a screw driver, every bodies situation is different. Understanding this and having a system to manage your property will keep your rental property a cash flow animal.

Let me rephrase that. Having a property management plan that works for you will keep investing in rental property headache free and running like a well oiled machine.

Having your rental units be a cash flow machine is a primarily a function of buying the rental property at the right price. However, even having bought a multifamily house at the right price, you can end your rental property being a cash flow animal without a good property management plan.

Remember, a good rental property plan will

  • Help you find good paying tenants who won’t do much more harm to your apartment than normal wear and tear.
  • Allow you to charge top rent because your apartment warrants it.
  • Make sure things get fixed quickly and cost effectively when needed.
  • Keep your tenants happy, so you don’t have frequent vacancies due to poor property management.
  • Make owning rental property stress free.

Understanding what a rental management plan should entail and implementing it will make your rental property business enjoyable and successful.

Things to Consider With Commercial Building Developments

One popular renewable energy technology used in commercial heating systems is a geothermal heat pump. The purpose of this technological advancement is to heat and chill water and space. This requires space for vertical or horizontal wells or shafts, which is a cooling requirement for the summer. A benefit of this type of technology is that no components are mounted on the roof.

Another popular technology is bio-energy fuels that come from fuel cells. This also includes gas engines, turbines, steam engines, or internal combustion engines. They can provide for electricity, space and water heating and cooling, and bio-diesel fuel. It requires organic material made up of wastes from farms, wood, food processing, crops, and waste water treatment facilities. This also helps the environment because it decreases pollution from waste and controls gas emissions.

Renewable energy technology can be extremely beneficial in commercial building developments. They can help to minimize building operation costs and reduce the reliance on fossil fuels. These technologies also help to decrease pollution and reduce greenhouse gasses. This can also help state and local economies, because it will create the jobs needed to install these technologies.

It is also essential to consider to the structure and design of a complex with commercial building developments. The objective, when designing an environmentally friendly building, is to reduce the total environmental impact that comes with all areas of the building and construction project. Green materials can also be used to increase efficiency. Some popular choices, due to how rapidly they renew themselves, include bamboo, straw, and lumber from wooded areas that are in sustainably managed areas. Other materials can include recycled metal and stone, clay, and dimension stone. Once the building is constructed, it is vital that the operations and maintenance of the facility be optimized in order to ensure that it continues to be sustainable. Personnel in charge of operations and maintenance should be involved in the planning and development of the project, as well. These staff members will also need to ensure that green practices like air quality tests and recycling also take place.

Many commercial building developers criticize the idea of building environmentally friendly structures because of the high-price tag associated with them. Modern technologies do cost more than others, but they also yield more over the life of the building. The issue to consider is the upfront cost associated with green techno lies versus the life cost. The savings associated with investing in green technologies and appliances will also decrease the energy of the buildings. Higher worker productivity can also be measured when buildings go green, so these savings should also be factored in to cost estimates, as well.

Tax Credits for Commercial Building Design

Did you know that you might be eligible for $1.80 per square foot tax deduction if you improve energy efficiency while designing your new commercial building? To qualify, building owners should make investments which will help bring down energy costs by over 50%. Taxpayers including commercial developers, homebuilders and anyone trying to improve commercial buildings are likely to benefit from these legislations.

Tax Incentives for Going Green

The Energy Efficient Commercial Building Tax Deduction is applicable until 31 December 2013. Section 179D (Commercial developers, real estate investors and architects) offers a depreciation deduction of anywhere between 30 cents to $ 1.80 per square feet for improvements which qualify in commercial buildings post 1 January 2006. Categories include heating, ventilation, air-conditioning and lighting systems. You need a licensed professional engineer to certify that a detailed energy analysis (as per IRS requirement) was conducted. It also requires a statement of how the calculations were performed for the various equipments or material used. Taxpayers who have made improvements to 50,000 square feet or more of their property, are LEED certified or even Energy Star buildings in utility rebate programs are ideal candidates to avail these credits.

As the move towards sustainable and environmentally friendly building design gains momentum, there are a number of credits and deductions in store for builders. The Section 48 (Energy Credits) helps those who invest in solar energy. It provides 30% tax credit and is applicable to all property placed in service post 31 December 2005 and before 1 January 2017. Professionals can help you with comprehensive information on state and federal policies. And while you choose to reduce the tax you owe, you can help save the environment also.