Spring has sprung here in Memphis, TN. It came a little early this year after a very mild winter. I’m sure a lot of people now have spring fever and want to get outdoors or to the beach for spring break. For me however spring break has another meaning, spring means repairs, a lot of them.
It seems that whenever the seasons change, things start to break. In the spring with the March winds and April showers it is missing shingles and roof leaks. With the rising temps, people start up their air conditioners and some will need recharging while others may not work at all. All of the landscaping and trees turn green again and need cutting, pruning and trimming. In short, it seems every seasonal change, with spring being one of the most drastic, brings a clump of repairs.
It is uncanny. As soon as the temperature changes, the phone calls start coming in. “My AC is out.” “There is a leak in the kitchen ceiling.” So far this spring I have replaced a condenser, a fan motor, recharged several AC units, fixed three roofs with two more to go and removed two trees that blew over. And it is not even April yet! So what does a smarter landlord do about all of this?
- First, just know it is coming and accept it. Things break and spring is a deluge. In the winter it is the heat and frozen pipes. This is just the way it is.
- Second, save up some funds. In a previous post I have stressed the importance of budgeting 10% of gross rents for repairs and putting away a little bit more each month for major expenses in reserves. Trust me, spring break it going to make you (and your tenants) glad you did. Understand that you will not have 10% worth of repairs every month. Some months may have no repairs, but averaged out over the year 10% is a good number. My repairs for all of 2011 totaled 10.14% of gross income. Almost right on the money.
- Third, have some skilled contractors on your team that you can call to fix the problem quickly. You will need a roofer, a plumber, a good HVAC person and a landscaper/tree person. By having these people on your team you can handle repair problems quickly and thus cut down on an even bigger expense, tenant turnover because you did not fix stuff in a timely manner. Where do you find these team members? Your local reia is a great place to start.
- Fourth, take the opportunity to be proactive and do a little “spring cleaning.” Now is a perfect time to inspect your properties, both inside and out, for damages and other problems. Contact your tenants and let them know that you will be conducting an inspection. Then, check their HVAC units and change the filters (tenants never do it), check their smoke detector batteries, check the plumbing for leaks and check around the outside for other general repairs such as fallen limbs, rotten wood, etc.
A smarter landlord has to be proactive and routinely check on their properties. I would recommend that you conduct an inspection at least twice a year. Perhaps once in the spring to check their AC, clean the condensers, etc., and once in the fall to check their heat. Always look at the plumbing under sinks, around toilets, etc. I can’t tell you how many leaks I have found that had obviously been going on for months and the tenant says “Oh yeah, I was going to call you about that.”
So there you have it: spring break, accept it, prepare for it and be proactive.
Until next time work smarter not harder.
