You vetted the applicant, confirmed their income and prepared a lease. Now you are well on your way securing a reliable source of additional rental income. But, before you can begin building your equity and wealth, you need to seal the deal. Before executing the lease, you need to orchestrate a walk-through and inspection of the property.
San Diego is one of the easiest markets to find tenants and build wealth. It is an expensive market to break into, but once you acquire your first condo in Hillcrest, one bedroom in South Park, and complex in Chula Vista, you will be well on your way to building a durable portfolio of investment properties. No matter if you have a San Diego vacation rental in Mission Bay, or a residential property near Balboa Park, it’s important to ensure that you establish a smooth in and out process for your tenants.
WHY DO YOU NEED A WALKTHROUGH?
Walk-throughs and inspections are standard practices before an applicant signs onto a lease. The applicant (and you) need to catalog the state of your rental property before the move-in. The inspection protects both you and your new resident from liability. It protects you because the inspection sheet prevents the applicant from claiming that part of the property, damaged while they were living there, was pre-existing before the move-in. Similarly, it prevents you from arguing that pre-existing damage was caused after the new resident moved in.
Since you may own multiple properties in the San Diego area, you may not have time to walkthrough all of the properties you manage, which is where a San Diego property management company can help.
Walkthroughs and Inspections: The Elements
The walk-through and inspection are exactly how it sounds. You and the resident(s) walk through the property together. You go through each room, showing them amenities, fixtures, and, if applicable, pre-existing damage. It is up to the both of you to note damage to the property.
Each nick, crack, water spot, and everything that is damage should be noted on the inspection sheet. The inspection sheet divides up the reported damage by room and type. A copy of the sheet is kept by you and provided to the new resident. During the walk-through, it is recommended that you take pictures of everything that is recorded on the inspection sheet.
If you San Diego rental is located near the beach, it’s common to see more wear and tear on the exterior of your property than those that are more inland, like in the Downtown San Diego area as opposed to La Jolla. Understanding the regular deterioration of a property is important for keeping up regular maintenance for your tenants.
Typically, the walk-through and inspection occur concurrently with the lease signing. Once you and the tenant agree that everything is properly recorded and the tenant is satisfied with the quality of the property – you both sign the lease.
HOW A SAN DIEGO RENTAL COMPANY CAN HELP
A San Diego rental management company can assist you by instituting standard procedures that ensure walk-throughs, inspections, and other aspects of renting are properly executed, nothing overlooked. The walk-through and inspection are the last time you and the tenant can confirm that everything is in place, i.e. the lease, the terms, and the property.
A San Diego rental management company, like Property Advantage, imposes standard procedures which insulate you from liability and from making unwise business decisions. For instance, Property Advantage utilizes the following philosophy: “When the property is clean, you send the message that you expect the property to be clean when they move out.”
A substantial part of your rental expenses and time is spent addressing the unpleasant and costly problems associated with tenants who abuse your property. It is far cheaper and efficient for you to create the expectation that your residents care for your property as if it were their own. It’s important to be thorough in your lease what the tenant’s security deposit will be used for, in the event that damages do occur, and you need to repair them.
Minimizing Costs, Maximizing Profit
Property Advantage is chiefly concerned with minimizing the unexpected and high costs for your real estate vacation rental or residential property. To that end, Property Advantage follows proven policies to govern the transition of residential or vacation properties under their care from one tenant to the next.
It’s important to set these expectations with your tenants up front so that there’s no gray areas as to the state of the property upon move-out date.
Property Advantage uses the same standards for all policies and holds all vendors to the same expectation. Property Advantage always utilizes the same procedures for every vendor and every unit, unless otherwise specified.
First, Property Advantage always uses a professional cleaning service for both in and outside of the unit.
Property Advantage also requires that each cleaning service submits an invoice detailing what was cleaned and how to support any debits against the tenant’s security deposit.
Property owners can debit the security deposit for unit repairs, cleaning, and maintenance when the tenant moves out. However, in order to debit the deposit, the property owner must provide the tenant with an invoice listing the expenses that were deducted.
Second, Property Advantage hires the same cleaning services because these companies are reliable and affordable.
Third, Property Advantage conducts the walk-through and inspection to document the condition of the property and again when the tenant vacates the property.
Leasing and managing investment properties can be expensive, time-consuming, and stressful. If you’re looking for help managing your vacation or residential rental properties, Property Advantage can help you.