Homeowners often hear the advice that they should save 1-2% of the purchase price of their home per year for maintenance, with even higher amounts suggested when a home comes with unique challenges. Investment property owners, especially at the start, may see the chance to defer or avoid maintenance and repairs as a way to hit profitability quickly. However, deferred maintenance is one thing that Norfolk property management sees catching up with investors over time.
Instead of deferring or ignoring maintenance needs, the solution is to budget for repairs sustainably and build a network of trust so that you can get repairs done the right way the first time, with preventative maintenance as needed. In the long run, it will cost less in both money and the stress of major emergencies.
Big Breaks Cost Big Money: Don't Wait to Repair.
From HVAC to plumbing, electrical systems to roofs, an important truth rings true; you can do small amounts of maintenance frequently, keeping things in good shape, or you can deal with astronomical costs all at once when deferred maintenance results in a major failing. Roofs are a prominent place that people see this. Roofs that should last 30 years that receive no preventative maintenance after major weather events end up losing enough shingles and experiencing enough damage that the top looks bad after 15 years or less, requiring replacement.
Working with Norfolk property management can help you to learn what preventative maintenance calls are worth the money each year to make sure everything is functioning. A small repair to a furnace, for instance, can help you avoid putting so much pressure on the system that it breaks down entirely, requiring replacement at an early age. Please don't wait and assume the problem will fix itself; usually, the opposite is true.
Penny-Pinching on Repairs? Prepare to Lose More Than You Save
Perhaps you're willing to do the repairs, but you want to find the absolute lowest price to keep every month's cash flow statement looking good. If the cheapest repair professional is also doing an amazing job, that is one thing. But often, the person with the lowest bid is not bringing as much expertise to bear as you might like. Remember, it costs more to hire two people (one to do the job badly and one to redo it) than to hire one high-quality professional the first time.
Norfolk property management focuses on getting you connected to affordable but reliable professionals from their vendor network so that you don't have to hire a follow-up repair person. Yes, their prices are often highly competitive, but they aren't undercutting the competition and then doing a cut-rate job. Instead, they offer reasonable rates because a property manager can offer consistent work and benefit from a bulk rate as well as long-term negotiations for rates.
Begin Budgeting Immediately Through Sinking Funds for Maintenance
Paying for repairs, however, won't be cheap no matter what you do, so a great plan is to start sinking funds. These are predictable amounts of money you save each month for projected repairs needs at your property. Each maintenance-free month, the money accumulates, so you have an "emergency fund" of sorts saved up for your property investment. When a major repair does arrive, or multiple yearly maintenance calls happen in quick succession, you don't have to scramble for the cash to pay for it. Instead, by budgeting a consistent amount, you can make predictions about how your cash flow will look each month and be pleasantly surprised if you eventually have a full sinking fund.
What's great is that, by investing in preventative maintenance over time, you actually reduce your overall risk of costly repairs, which makes it easier to stop adding to your sinking fund for a while, boosting your profit margins long-term without endangering your cash flow early on in your work with a given building.
Property Managers Understand Maintenance Schedules and Budget Management
As Norfolk property management professionals, we understand what you're going through when you see a major bill coming in for a property. However, we've also seen what the more predictable timelines for repairs and replacements are, so we as property managers can share information that will help you budget and prepare for these expenses in advance.
We understand the challenges of maintaining your property and keeping your cash flow positive as well, so we want to help you create good habits that will protect you through planning. Maintenance is predictable in the long term and not in the short term, so let our excellent track record for understanding property repairs and maintenance help you make a schedule and prepare instead of feeling blindsided over time.