The Secret to 100% Occupancy
I've owned quite a few investment homes over the last decade. The number is somewhere around 500 even if some were only for a few days. A fear many people seem to have is how to prevent vacancy. They are searching for 100% occupancy with their real estate portfolio. A Return On Investor or ROI requires an "I". Many people have invested a few years ago with little to no money down when lending was easy. This was actually possible and still is possible but is definitely a rarity. I've seen the mistake though of poor upkeep which often doesn't entirely rest on the tenant that is in the property. Proper upkeep often requires the investor to improve the property over time. Example, I just spent $1000 on reseeding the yard of one of my homes. I bought this zero down when money was flowing freely. I'm investing in the home. Don't expect infinite returns from zero investment. Equate it to chasing rainbows (in the end frustrating). Location quality is often overlooked. Buying an investment home because it is in the cheapest area is a common mistake resulting in long term vacancy, theft and vandalism. Many times an investor buys the $20,000 house which is supposed to generate a rent of $700. That $20k you paid? Trust me, it won't be that simple. If these types of deals were automatic paydays, everyone would be doing it. Did you buy on a dead end street? I have. Good luck getting it rented quickly. How about in the bad school district? Boarded up neighborhood? What you didn't use Google Streetview to check out the street scene? Return on Effort is critical. Don't buy an investment property and just wait for the statement to come in at the end of the quarter showing all the profit. Even with a property management company, you still need to keep on top of your investment homes. Remember you've bought a structure, a building, a home. These things breakdown, management companies certainly aren't perfect, and sometimes people just flee in middle of the night. This means not only do you have to pay attention but you need to flex your communication skills with the management company, make sure they are actively marketing your home both online, and with adequate signage. In the end, it is your investment. You've bought and probably committed to a 15 - 30 year loan. Buying in the right area, investing dollars into your property will only get you so far. Investment property is and will be a team sport. Picture yourself as the coach who is managing all the players and you'll find your portfolio at 100% occupancy.
