As we put our plans into action to grow our real estate portfolio, we are thinking long term. Yes, we are actively pursuing great deals: good properties, in good areas, with strong economic fundamentals. And yes, we love the math that ensures positive cashflow on Day 1, mortgage paydown, and optimizing the likelihood of appreciation. We even force appreciation with some properties by doing strategic renovations and/or adding a legal secondary suite.
But what happens between getting the deal—and cashing out in 5, 10, 20 years? Today’s focus is on the property management that makes the difference between a good ROI and a great ROI over the long term.
Did you know, multiple tenant satisfaction surveys and studies have shown that the number 1 reason tenants choose not to renew their lease is the quality and timing of maintenance service?
Our maintenance plan begins before tenants move in. We do a walk-through of the property with the tenant(s). This is known as the move-in inspection—but it’s also our perfect opportunity to educate the tenant about how various appliances work, where the water shutoff valves are located, and when we expect the tenant to call, text or e-mail with a maintenance request or emergency. We give them various ways to contact us, and post a contact list on the inside of a kitchen cupboard. We explain the maintenance that we do (typically larger items) and what we expect the tenants to do (typically snow shoveling and minor yardwork).
Each year we learn something new to add to our checklist. Last Christmas, one of our tenants turned his furnace off to conserve energy and save money—it made perfect sense to him. Unfortunately, the outdoor temperatures dipped below -20 celsius! Luckily we were driving by the property for an unrelated errand and we noticed the frost on the upstairs window! We were able to quickly take action before any pipes froze! Now we include a short “don’t turn your furnace off if you’re away for winter holidays” speech as one of the items on our checklist.
We also offer biannual walk throughs with the tenant. We have noticed that many tenants will avoid “bothering” the landlord, or will be concerned that we’ll “blame” them when something breaks. But if we physically come into the unit to change furnace filters, check smoke/CO detectors and inspect the exterior—we find that tenants will to be more open about any little things that might not be working correctly. One tenant was in her unit for 3 months before she admitted she couldn’t figure out the dimmer switch—it was just different than what she was used to. A 20 second demo—and she was good to go and much happier with her lighting! Now truthfully, our biannual visits aren’t completely altruistic. We are also looking around to see if there has been any damage, or if there are signs of extra people living in the property. If it is a non-smoking property, we are also monitoring that situation closely. Typically we prefer our tenants to move in and stay for a long time—but when necessary, we want to act quickly to remove a tenant that isn’t respectful of the neighbours or property.
There are so many reasons to have a solid maintenance plan for your investment properties! Preventive maintenance can minimize breakdowns, and decrease expensive emergency repairs. Routine maintenance visits strengthen the communication between tenants and landlords. Good maintenance records also help with any tenant disputes. We could go on ….
Providing great service to our customers and a good quality property is our best tool to attract and retain high quality tenants that pay top market rents. And we all know what that means: optimizing return on investment!
