We all have a problem. Whether you’re a property manager or a self-manager we all have a problem collecting rents. I’m here to tell you there’s an easier way. Most landlords and property management companies like to manage properties that are class A,B,C in that order. Well my experience has taught me a few things about managing the type of property that no-one talks about. That’s the Class D property. The Class D property is sort of a no-mans land. They’re typically the most profitable from a cash flow perspective but they also take the most active management. Therefore a lot of property management companies simply won’t manage them. As a parent I simply take some of the same principles my parenting has taught me and apply those in my property management.
I’ll tell you a story about a client of ours. They were having just an impossible time managing a property in the Orlo-vista area. They were ready to sell the property and get out of the Orlando Landlord business altogether (we’ve all been there!). I had a discussion with him and suggested we try giving the tenant something! He replied: Whatt!! Give them something? They owe me and you want me to go into more debt.
This is precisely what I wanted him to do. Here’s what happened. He promised the tenant a free TV if the tenant paid their rent on time for 6 months straight. This might seem like a lot to offer. But we all know that Class D properties cash flow well. Second, we know ALL tenants love rewards. The landlord immediately started worrying about everything that might happen 12 months down the line. Questions such as whether he would need to do this every six months, etc. I told the landlord, STOP!, let’s get the rents paid and then we’ll worry about the rest. He obliged and wouldn’t you know it? The tenant paid all rents for 6 months straight.
I encourage you to try this. If you’re a current customer of mine and I manage a Class D property for you, I’m opening up a new offer to you. Let’s offer your tenant a free TV. You have nothing to lose. Contact me for more info.
Also, if you’re a self manager and you’re reading this feel free to take this tip. It’ll work every-time.
Happy Managing and Happy Holidays!
-Rick
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