Administration And Risk Management Basics For Landlords

There are four major areas of responsibilities that every landlord should know about. These are: marketing and financial, tenant and occupancy, facility, and administration and risk management. Covering all these major areas of responsibility would take a while for first-time landlords to do. So, for this piece, we will look into the administration and risk management part of a landlord's job description.

As the term suggests, this part revolves around the record-keeping functions of the landlord. Remember that if these records are carefully managed, the end result as far as its effect on the business would be very positive. You should first start with learning what records you need to keep and why they are very important.

The marketing and financial side of the business involves records of spending and income. What data should be kept with regards to marketing and financial area? Advertising invoices for example should be recorded for future reference. The same can be said of tax records, repair costs, property manager fees (if you chose to hire a rental property manager), and the likes.

Tenant and occupancy, another area of responsibility of a landlord also need records to be kept. You need to keep records of tenant applications, the lease agreement, lease policy, and similar documents. One situation where you would be required to produce these documents is if you are being investigated for not following the Fair Housing Act. If you can produce your records to prove that you apply your policy fairly and equally, you can easily beat the case.

The third area of responsibility, facility, also spews out its fair share of documents you need to file and organize. Receipts from contractors should be recorded. Repair records and warranty should also be carefully tracked.

Risk management on the other hand would have you dealing with balancing the risk and reward in any endeavor related to the operation of the property. For example, in building a pool or hot tub within the property, the landlord as well as the property manager should not only look at the possible rewards of having such an amenity.

By learning what tasks are involved in this major area of responsibility, you can learn how to track how well or how bad your business is going. You can also determine the areas you are spending too much money on and could then create a solution to reduce your expenditure on that front. All in all, this is one part of your responsibilities as a landlord that you should be very well-versed at.

How Important Is It To Find The Right Property Management?

If you happen to own a property, whether it's for commercial or personal reasons, it is important that you manage it well. With the current economic crisis and thought market conditions, it's important that your property is well cared for. A property is an investment for life, and financially and economically you can't afford to lose it under any circumstances. It's understandable that you may not have time to look after the property yourself, so there is always the option of finding an expert property management company that will take care of your property for you.

Property management doesn't just focus on managing our property but it also acts as a regular extra earning mechanism. Your chosen property managing routine should include 3 important steps such as:

- Marketing the property
- Everyday functioning and maintenance
- Keeping tabs on proceedings.

Properties are usually rented or leased out to suitable customers or if you're ready the management company can even help you sell your home. To ensure that your property is visible to potential customers it's important that there is a successful marketing plan in place. This marketing plan should attract good quality tenants. It's also important that that you choose a company that attracts customers through a good quality service. The property should also be well maintained, so it looks attractive to potential tenants who may be interested in the property.

The day to day functioning of your property should be something that your property manager should take care of. It's their job to collect rent, hire maintenance service providers. They should also that they chose service providers are low cost and reliable to prevent any harm to the property.

Your management company should report to you about your property because this is of great importance to you, you should be fully aware of the status of your property at all times. Don't hesitate to ask for an evaluation from your property manager on a regular basis, because this evaluation reflects the work that has been done so far and then you can begin to work out the next level approach for the property. You should also receive a yearly plan/advice on what you can do to improve your property.

Finding a reliable property management can be time consuming but you should choose a company that is suitable for your profit, so have a look online for best property manager that will suit you today!

Advertising Ideas For Rental Property Owners

The world is an ever-changing place and it is important for businesses to keep pace with these changes. For instance, for rental property owners, they have to contend with the fact that vacancy rates are going up. This means there are fewer individuals or families willing to rent even if they just recently lost their home. Another thing that landlords have to keep abreast of is the increased usage of the internet.

Taking those two things into consideration, you can come up with a good plan to avoid having your rental property vacant for a long period. In this piece therefore, we are going to look at how to take advantage of the popularity of the internet to spread the word about your property.

First off, when talking about the internet, it is not out of the question that you think about having your own website. But does it make sense to invest in one? It would depend on how big your business is. If you have plenty of rental properties scattered across the country, then investing in a website is justifiable. But if you only have one property or a handful of units, then the cost of building a website would just be an unjustifiable drain in your financial resources.

Once you have answered the question whether you need a website or no, it's time to focus on reaching out to people. Even if you have a website, you cannot just expect people to stumble upon it. That's where the beauty of online social networking would come in.

On social networking sites, you can reach out to real people and there is a big chance that you will get immediate feedback from them. For example, you can find friends of your friends and ask them to check out your site if they are looking for a rental property or you can ask them if they can recommend your site to someone who might be looking for what you are offering.

Another way you can spread the word about your property is through online ads. There are different classified ads site, some are for free while some would require a small payment for the ad placement. You can post pictures of the vacant rental property and your contact information on these sites and it would cost you significantly less than taking out an ad on traditional media like newspapers, radio, and television.

Planning to Lease Your Mineral Rights? Here Are 6 Risky Issues You May Face

Mineral rights owners are often confused whether to sell or lease their ownership. Leasing seems to be pretty luring as it is assumed by many to be a steady income-generating option. But, in reality, leasing is not as simple and beneficial as it is perceived.

Below are 6 common potential risks when leasing mineral rights:

1. Unsteady Royalty Payments
A royalty payment is the compensation received by the mineral rights owner in return for giving the mining company the right to extract oil and gas from his property. Although there are different methods in calculating this payment, the most basic form would be an up-front lease bonus payment plus a royalty percentage of the value of production.

It is clear that royalty depends on the value of the production. If you are leasing the rights for the first time, the production will be substantial in the first few months. As the drilling goes on, the producing potential of the well decreases and will affect your royalty payments. Unless, you have a good producing well, leasing generally leaves you with an unsteady income. Also, there is a chance the leasing company does not intend to drill at all during the lease period leaving you with no income and tying your property up.

2. Risk of Depleting Assets
It is very difficult to predict the producing life of a well. Sometimes a newly drilled well which produces a substantial amount may suddenly stop producing and become depleted. Once it's depleted, your mineral rights become worthless. You neither receive royalties nor can you sell rights to other companies.

3. Negative Impact on Property's Value
One of the biggest drawbacks of leasing is not knowing the right terms and clauses to include in a lease. This can potentially greatly decrease your income on a property. If you sign a lease but leave in negative or operator friendly lease language you can impact the overall property value. Also in many cases, it's best not to lease to get the greatest value for your rights. In any case it's best to look into this before executing a lease. If you own severed mineral rights, many times the surface owner can be a big messy problem to deal with. Many clauses that deal with surface ownership should be taken very seriously and left to those that know it best.

4. Complicated Legal Procedures
Once two parties agree on the mineral rights lease, both parties have to sign an agreement which is generally prepared and drafted by the leasing company. All legal procedures and documentation with regard to leasing is complicated and can lead to disputes and disagreements during the extraction and production. If you disagree with any of the operations after the drilling commences, as per the agreement, you will be bound by the lease that was executed in in most cases cannot stop the operator from drilling.

5. Heavy Tax Burdens
While most income from a mineral rights sale is taxed at 15% (Capital Gains), the income from royalty and bonus payments from a lease payment is charged for ordinary income rates which can be very high! (Check with your tax professional). It is usually very beneficial to sell the mineral rights over leasing them due to the much lower potential tax rate of the income and sale.

6. Accounting Hassles
Receiving a royalty payment may seem exciting, but the accounting and records maintenance is a challenging task. One has to monitor the drilling process, payment process and pending payments. In addition and more importantly, in order to check the accuracy of the accounting, professional audits will be necessary.

The only way to avoid all of the above-mentioned hassles is to sell the mineral rights. By selling your mineral rights, you will receive a lump sum cash payment that you can put to use on other investments like real estate or payment of bills or payments that are due.