Landlords are always looking to save themselves money when the opportunity presents itself. When it comes to repairs and maintenance many owners who live relatively close by try to take care of any maintenance on their own as a way to cut down costs. Here at the top 3 reasons a landlord should not do this:
Time is money
Unless you are retired or have time on your hands, it is difficult for most landlords to break away from their already busy lives to take care of repairs. Not only do you have to manage your already hectic life, but now you have to run out to the property to look at what the tenant is complaining about, determine what you need to do in order to fix it, run to the hardware store and back hoping that you have the right part or don’t run into a lot of traffic. In addition, the tenant usually wants the problem to be fixed right away and do not like having to wait a couple days while the landlord try’s to fit the repair into their schedule. Taking time out of your busy day may not be worth all the extra effort you have to put in just to save some money. After all, the material costs will be about the same, the only thing you are truly saving is the labor and chances are for most owners, if they are taking care of the work themselves, it is something that can be fixed rather quickly so the labor costs would not be that much.
Homes that are empty are usually easier for someone to fit into their work schedule since they do not have to conform to the tenant’s schedule. In general, however homes that are vacant will usually require a small list of repairs which can add up fairly quickly. Something that may take a repairman and cleaning crew 2 to 3 days to complete may take you a week and a half to two weeks. This is mainly because contractors and maids are fast at what they do because they have to be in order to maintain competitive with their price and profitable at the same time. Some homes areas on Oahu with a low rent amount average about $40 a day while other areas may be closer to $175. It's important to consider the amount of time it will take you to complete the repairs versus hiring someone else to do it for you.
You get what you pay for in most cases. Skimping on quality can have a negative impact on the overall feel and presentation of the home. People know what cheap and poor workmanship looks like. Good quality tenants are not looking to rent something that looks like it was put together over night. Granted, low rent roll areas don’t require high quality amenities such as granite counters or travertine tile, but good tenants are looking for a home that is well maintained with amenities that match the rent value. The goal is client retention. The longer the tenant stays in the property, the more profitable it becomes. Placing an emphasis on quality can help establish a longer relationship with the tenant as they feel the home is properly maintained in addition you do not run into repeat problems as frequently which can stress both you and the tenant out.
Whenever someone chooses to do something themselves over hiring a professional there is always an added level of risk. With repairs, if a landlord does something incorrectly, they assume full liability for it. For instance, the landlord installs a new wash machine in the home and everything seems to be working properly. Then the tenant goes to use it for the first time and like a lot of people, they turn it on and then run to the grocery store only to come home to 100 gallons of water on the floor because the drain line popped out. While the tenant does have renters insurance, if the homeowner was the one completing the repair, it is very likely that the tenants insurance company will go after the landlord or subrogate it through the landlords insurance. Other risks could include the tenant injuring themselves on the homeowner’s tools or equipment, using chemicals or other items which the tenant may be allergic to, etc. It is important to minimize your risk as a property owner and one way to do this is to hire someone to take care of the repairs for you as it adds an extra layer of insurance.
When should landlords take care of the repairs themselves
First and foremost, you should only take on repairs that you are familiar with and comfortable that you can handle it. If it is something you are not skilled at, you are better off leaving it to the professionals no matter how simple it may seem. Owners who are also contractors or repairman often times can complete most of the repairs themselves which can help cut down their expenses tremendously, but it is always good to check with your insurance provided to make sure your protected in case something were to happen.
November 11, 2013