The first and most important reason why you have bought a piece of rental property is because you want to make some money out of it. The money comes to you in the form of rent and apart from a list of expenses and payments, what you are left with is your return on investment – the profit. It may seem easy to simply hike the rent and make more profit, but the real estate market does not work like that. Then there is property maintenance, and they are the third most important outflow apart from the monthly mortgage payment and taxes. The real cost of property maintenance can compound if you are not careful with the spending, here are three ways you will lose money on it:
Mandatory property maintenance
There is a property maintenance code that mandates certain type of checks and maintenance procedures that have to be carried out on all property. These codes vary between States, but have to be done professionally. They are not very expensive, and more of a precaution, but cannot be skipped.
Maintenance requests from the tenants
Sometimes, when the tenants request some kind of building maintenance, it may have to come from your pocket, this is because it may be as part of the standing structure and not because of the misuse by the tenants.
An advantage of good property maintenance is the fact that it will add value and fetch a higher price for the home, important updates like the piping and electricals are also imperative.
It will do you good to know that not every thing has to be done at once, also major remodeling and updating can put major dents in your budget, at the same time, if there is no property maintenance work done on the home, the value may drop and tenants may not take it, so moderation is key.