Owning real estate in San Diego can help you establish financial security and build some long-term wealth. Your investment will appreciate over time, and you’ll also collect monthly rent, which will contribute to the costs of maintaining a rental property. It’s a smart financial move.
While there are a lot of benefits to renting out your San Diego property, there are a few challenges as well. Most experienced investors would tell you that there are always a few unexpected surprises along the real estate journey. If you’re investing for the first time, check out these tips. We have been working with new investors for years, and our experience can help you avoid the expensive and time-consuming mistakes that many first-time investors tend to make.
Pay Attention to Your Rental Value
New investors are often unsure about how to establish a reliable rental value for their property. It’s a good idea to consult a San Diego property management company before you invest. You’ll get a good idea about what rental values are in the area you’re targeting, and you can project what you’ll earn before you buy.
Maybe you have a vague idea about what you’d like your property to earn every month, based on your mortgage payment and other expenses. However, the rental price is really market-driven. It doesn’t matter how much cash flow you’re after or what you’ll need to make your mortgage and tax payments. Evaluate this local market thoroughly and check the prices for competing properties that are similar to yours.
A good property manager will have access to the data you need. Try to stay competitive; vacancy is more expensive than anything else in real estate. Never overprice your property.
Prioritize Preventative and Routine Maintenance
Maintenance is always going to cost money, and that can be difficult to accept. But, you don’t want to risk devaluing your property or allowing its condition to deteriorate. Deferred maintenance will also lead to frustrated tenants who are unlikely to renew their leases. When a tenant makes a maintenance request, respond to it right away, or at least let the tenants know when you’ll be able to take care of the problem.
Handling problems while they’re small will save you money and avoid headaches. In our years of professional residential management experience, we have never seen a maintenance issue become easier or cheaper with time.
Understand the California Rental Laws
The laws in California have become more complex for investors and owners. In 2020, a series of new rent control laws went into effect statewide, and with them regulations on just cause evictions. There are also new requirements when you’re screening tenants. For example, you cannot deny a Section 8 tenant who is qualified. That housing voucher must count towards income.
There are security deposit laws and habitability laws as well as fair housing and other federal, state, and local requirements that need your full compliance. Get to know them and follow all the changes in landlord and tenant law.
Work with a San Diego Property Manager
Unless you have the time, knowledge, and experience to manage an income-producing property on your own, hire a professional property manager. You need someone who knows the local market and understands the property management industry. Find a company that can accurately price the home, market it, and screen for highly qualified residents.
Look for a management company that has good relationships with local vendors and has a reputation for helping owners earn more and spend less on their investment.
Consider our team when you’re looking for great management. We have a deep knowledge of the local market, and we can help you have a more successful investment experience now and in the future. Contact us at San Diego Residential Property Management.