The projections for the coming months—and even the next year or two—are a fairly big question mark for most industries. While there are certain businesses that have thrived during the coronavirus pandemic, there are others that have been nearly destroyed—if they survive. The recession prompted by tens of millions of people losing their jobs won't just go away even with many states opening back up in a cautious way. Florida may soon be facing renewed closures as positive cases surge.
As a Winter Garden property management professional, we certainly have seen considerable changes in the way property owners operate their rentals during this time. From social distancing during maintenance to switching completely to online rental payment platforms, we're all taking steps to maintain our income and shore up potential losses.
However, even while rental payments have remained largely consistent—and people always need somewhere to live—property owners can still be affected by the fluctuations in the economy. Your tenants may or may not have found new jobs, and their circumstances could result in some shortages in cash flow.
You also depend on your rental income, so staying successful during a recession is critical for your business. How can you make it happen? Here are a few ways to tackle a recession and keep thriving through it!
Looking to Economize? Property Managers Have Been Doing This Forever!
If you've been devoting all of your time to handling the day-to-day work of your rental properties, one of the fastest ways to become a more efficient business is to work with Winter Garden property management! They benefit from economies of scale by handling the day-to-day work of many different landlords' properties, saving you money in many areas.
Rather than paying the expense of managing your own rental payment portal, you can have tenants pay through your property manager's online payment portal! It would create even bigger savings if you were taking trips to the bank to cash checks or meeting people in person to collect the rent, wasting your time. Plus, you gain the expertise and the skills of the property management company beyond simple rent collection services.
Professional property managers know how to market your properties—even during a downturn—and they know which places get them consistent applications from interested renters. You might spend more money and more time and still get fewer applications if you simply haven't been a landlord in Winter Garden as long as they have.
Finding repair and maintenance vendors on your own takes time—and will not give you much of a discount for a small number of repairs. Winter Garden property management companies can offer semi-consistent work due to the volume of properties they serve or have maintenance on-staff, so they benefit from economies of scale and pass those savings on to you!
As you can see, the way that property managers economize can give you some insight into how to run a tight ship during a recession. You'll see that great property managers don't skimp on the essentials, including clear communication with tenants and landlords. Instead, they find ways to avoid wasting time and energy; everyone wins, and your business gains stability—even during a recession.
Make Contingency Plans for Recession Cash Flow and Expenses
Of course, there still can be tough months as a landlord—especially if your tenants are in desperate times or there is an eviction ban while tenants aren't keeping up their end of their contracts. It's wise to figure out what you'll do in such contexts when a recession hinders your cash flow while your expenses continue to be sustained.
Here are some questions to ask yourself:
- Is there routine maintenance that can be delayed in order to cut some expenses?
- Can you work out a payment plan with any tenants whose rent is currently late?
- Are you looking ahead to make sure you won't have any kind of vacancy?
By making a contingency plan, you are less likely to encounter circumstances that will frustrate or undermine your progress as a business owner.
The Sooner You Get Started, the More Choices You Have!
When we're on our way out of a recession, it's tempting to shake off past experiences as a bad dream; something you won't have to think about again. However, one thing that is wise to remember is that you'll see more long-term success if you are proactive rather than reactive.
Knowing exactly how you'd handle the recession differently if you had new information (like you do now) is key! Try to plan your responses ahead of time and spring into action when difficult circumstances strike, communicating clearly with tenants and your property manager. Just reacting to crises along the way when they grow too big to ignore gives you far fewer options.
If you aren't sure how to proceed with your "business as usual," you don't have to go it alone! Download our Collecting Rent in a Crisis Handbook to gain further access to our insight at Verandah Properties!