At Muldoon Associates, we work with investors who own properties outside of their own geographical area. A lot of investors are interested in owning property in Colorado Springs, and not all of them are close to us. Some of them are even outside of the country.
Not only do we have a large portfolio of properties that are owned by out-of-state investors, we also rent out homes owned by people who once lived here but don’t live here currently. Not everyone sells their home when they move away. Sometimes, keeping the asset and renting it out makes more financial sense. We also work with those owners, to keep their properties occupied, well-maintained, and earning money.
Investing in a home outside of your own geographical market is easier than ever, thanks to technology and the growth of expert property management in local areas like Colorado Springs.
It’s easy, but it’s not completely without risk. How can you protect your out-of-state home?
There are many ways to ensure it’s safe and profitable. Everything starts with local property management. If you cannot be physically in Colorado Springs yourself, make sure you have a good property management partner who can handle the day-to-day logistics on the ground.
Let’s take a look at what’s required to protect your property when you’re so far away from it.
Protecting Your Colorado Springs Home from Vacancy
Vacancies are always problematic, especially when they are long, expensive, or unexpected.
You want to keep your property occupied with good tenants, and it can be frustrating to have your rental home left unoccupied for long stretches of time. Without the consistent rental income you expect, your entire financial picture is disrupted.
This is especially nerve-wracking for out-of-state investors. The vacancy period can seem even more threatening because you cannot be there physically to show the property, market it aggressively, or drum up interest among your own local network.
This is why your Colorado Springs property management partner is so critical. You won’t have to worry about long vacancies. If there is a period of time where the stretch between tenants is longer than you’d like, at least you have someone who can check on the home and its condition.
There’s less to worry about when you have a management professional who excels at:
- Pricing your rental property competitively to attract good tenants quickly.
- Marketing rental homes with professional photos and excellent listings that are widely syndicated to all the most popular rental sites.
- Responsive tenant showings that allow for pre-screening.
- Online application processes and fast, efficient tenant screening.
Long vacancies are expensive and best avoided. You want to focus on fast rental periods and long-term tenant retention plans. As an out-of-state owner, choose a managing partner with a low vacancy rate and a high retention rate.
Protecting Your Colorado Springs Property from Bad Tenants
When we think about bad tenants, we generally think about tenants who pay rent late (or not at all), who damage your property, and who violate the lease agreement without really caring.
You’ll also have the potential for difficult tenants, such as those who don’t communicate or create extra noise or complain endlessly about every minor thing. But as an owner who lives out of the state, you’ll really be concerned with three potential problem areas. Here’s what they are and how to protect yourself from such situations:
- Late Rent
You might be wondering how you can collect late rent from hundreds or thousands of miles from your rental home.
Your property manager should have a consistent rent collection process in place that ensures payments are made on time every month.
The rent you receive from that property manager should also be timely. Everything can easily be done electronically, and that’s really going to help when you’re out of state. Paper checks in the mail are unreasonable; you’ll need online access to your rental payments.
If you have a tenant in place who continues to pay late or leaves rent unpaid, make sure there’s a plan in place for collection and if necessary – eviction.
No one wants to rush into an eviction. But you want to know you have a plan in place in case eviction does become necessary. Your Colorado Springs property manager will understand all the local laws and the required steps as notices are served and court papers are filed.
- Lease Violations
What if your tenant is actively breaking the lease? You’re not there to enforce that lease agreement, so it may be hard for you to even know you have a situation on your hands.
Unless you’re working with a property manager. In that case, there will be inspections and ongoing communication, and a systematic effort at lease enforcement.
A lot of non-local landlords become concerned that their tenants will leave before the lease ends. Broken leases are expensive and frustrating. You’ll want to be sure a security deposit is collected.
- Property Damage
What if your tenant damages your home?
You will have to cover the cost of general wear and tear in your rental property after one tenant moves out and before another tenant moves in. When there’s damage to your property, however, your tenants can be held accountable.
But you’re not there to inspect the damage or gather quotes and estimates from vendors. You cannot go to the property and see the problems for yourself. Property damage often feels worse than it is when you’re not actually there.
Protect your out-of-state investment property with a management team that’s excellent with documentation and able to work with tenants to avoid excessive property damage.
Avoid Deferred Maintenance with Inspections and Vendor Relationships
You’ll need a reliable maintenance plan in place when you’re protecting the condition and value of your out-of-state property. Look for vendors who can handle these things for you and deliver preventative services. You’ll need to put together a preferred network of professionals, including:
- General contractors
- HVAC technicians
- Pest control
It’s not always easy to find good vendors. With a Colorado Springs property management partner, you’ll have a team already in place. Most management companies either have their own professionals in-house or have long-standing relationships with licensed and insured vendors who often provide the best and most competitive prices.
Partner with Professional Colorado Springs Property Managers
It’s really difficult to rent out your Colorado Springs home from afar. You need a professional Colorado Springs property management company.
Local experts will do an excellent job of protecting your property and keep you informed about what’s going on and why.
Your property manager will respond to emergency and routine maintenance, make sure rent is collected on time, and provide you with real-time information on how your property is performing. We know the market. We know the laws. We’re ready to provide an outstanding experience for you and your tenants.
Professional management will provide a lot of peace of mind. You won’t have to worry about vacancies or tenant placement. You’ll have experienced professionals who can provide maintenance, lease enforcement, and general guidance on the protection and promotion of your investment.
If you’re leaving behind a home that you might return to someday, talk to your property managers about what worries you. Maybe you don’t think tenants will be able to take care of your lawn the way you want them to. Perhaps you’re worried they’ll damage the floors that you love.
If you’re thinking about investing in a property but you don’t live here, talk to your management company before you buy. You’ll get an idea of how much rent you can expect and whether repairs will be needed to get the property rent-ready.
Communication and Out-of-State Investors
If you want to protect your rental property when you live out of the area, you absolutely must communicate frequently and transparently with your property managers. Make sure they have your updated contact information. Discuss expectations about communication and how frequently you want to hear from them.
Look for a company that provides an online portal for you to send messages, check statements, and access reports and other documentation. You’ll feel more connected to your property, and you won’t have to worry about what’s happening in your absence. And, if your property managers are communicating responsively and proactively with you, you’ll know they’re just as available to your tenants.
Property Management Technology and Colorado Springs Owners
You’ll need the best technology.
The online portals we keep talking about will allow for rent to be paid online, maintenance requests tracked and documented, and information easily and immediately shared.
You will want to make sure you can receive electronic rental payments through direct deposit. You’ll also want to make sure you can look at accounting statements and run reports online. Find out how you’ll be informed when a repair is needed, and how those invoices are paid.
With technology, you can track income and expenses, communicate with your property managers, and stay up to date on lease renewals, marketing strategies, and lease negotiations. It’s critical that you have access to good technology when you’re investing in properties from another state or another country. Communication will be important, and you don’t want to feel even further away from your investments.
We would love to talk more about our plan for protecting your Colorado Springs investment property, even if you don’t live here in Colorado Springs. Please contact us at Muldoon Associates.