Generally, media company personnel start investing in residential apartment complexes to create a reliable income stream for the future. In the early years of ownership, concentrate on building a savings account to act as a safety net for any unforeseen repairs, which can be expensive when multiplied by 20 or 30 units. Start paying off that high-interest rate mortgage once you feel comfortable with the amount. Once the mortgage note is paid in full, that reliable income stream just became a residual income stream, meaning you don’t have to do much work and the money still comes in every month. And then you will realize that your patience has paid off.
Rental property investors often utilize the services of an unseasoned media firm personnel who does not fully understand rental properties, who do not fully understand the return on investment, and who does not fully comprehend what cap rates are. Most of the time, these investors turn to their friend ‘the realtor’ or use any realtor they are familiar with or are comfortable with to purchase these types of properties sad as that may sound.
The fact is most real estate agents are not savvy enough to understand rental properties, cap rates, return on cash, return on investment, leveraged investing, and the standard terms associated with investment properties. To compound this fact, most media company investors initially are equally inexperienced and lack the proper expertise to locate and purchase a high-performance investment property. One problem is that some investors are just so excited to get into a property they look beyond the truth and the numbers and want to gain control of the property.
The Property Management Profession is an Equalizer
After an investor has closed escrow, if the inexperience media agent hasn’t offered to ‘manage’ the property for them, many of them decide to manage the property themselves (only licensed real estate brokers can manage rental properties). When these unsuspecting owners are faced with the subtleties of Fair Housing laws, Equal Opportunity issues, civil rights issues, anti-discrimination issues, bad tenant screening issues, notice of default issues, eviction issues, and finally collection issues many times they turn to a professional property manager or property management company to help rescue their sinking ship.
If retrieved timely, a professional property manager can turn around an investment property and help make the media company investor’s decision pay dividends. With a competent property manager, the return on investment can be realized, and the media firm actually can have time to enjoy the investment, not dote on it or worry about it. The property management company will take care of the investment, the maintenance, the tenants, and all of the accompanying issues associated with the property. Apartment complexes are most commonly managed by larger property managing companies in Pretoria and media firms companies who, in turn, hire individual managers to operate each of the facilities on behalf of their clients (the actual owners). The fact is most real estate agents are not savvy enough to understand rental properties, cap rates, return on cash, return on investment, leveraged investing, and the standard terms associated with investment properties.