If you’re like most people, the thought of earning thousands of dollars in passive monthly income is enough to get your heart rate pumping. But is it even realistic? And are there practical ways to generate passive income and live the life you want? The answer is yes, but you have to be strategic about which sources of income you choose and how you approach them.
Owning cash flowing investment real estate properties is one of the best options. And if you leverage the right technology and tools, you can do so remotely – meaning you won’t ever have to step foot on your property to unclog a toilet, collect a rent check, or settle a tenant dispute.
Try These 6 Remote Management Tips
Whether you own a single property or multiple, it’s possible to manage rental properties remotely and enjoy passive income generation that compounds month after month after month. Here are a few suggestions:
- Hire a Property Management Service
Let’s be clear about one thing: If you want to be a hands-off landlord, the best thing you can do is hire a professional property management service. While it’ll cost you a percentage of your monthly rental income, a property manager will handle all of those small yet time-consuming tasks that must be done. This includes finding and screening tenants, overseeing lease agreements, collecting rent checks, scheduling repairs, and even handling accounting.
And while we’d highly recommend hiring a property management service, we recognize that it’s not the only option. If you want to go another route, we’re going to provide you with some other helpful tips.
- Use Cloud Accounting Software
Accounting plays a significant role in successfully managing profitable rental properties. With cloud accounting software, you’re able to input income and expenses from any device on any network. This increased flexibility ensures you’re able to manage the financial side of your investments at all times.
- Create a Tenant Portal
A tenant portal is an online system that gives each tenant a dedicated account through which they can pay rent, file repair requests, ask questions, or access a copy of their lease agreement. It’s highly recommended that you use a tenant portal to keep things organized – especially if you have multiple properties in your portfolio.
Even if you don’t create a dedicated tenant portal, you should set up digital payments. This makes things easy on yourself and eliminates much of the friction that frustrates the average landlord.
As real estate professional Alex Haslam writes, “Collecting payments on time can be one of the toughest aspects of remotely managing a property. At the same time, getting paid promptly every month is essential. A digital payment strategy simplifies the process for both you and your tenants.”
Digital payments can be made through a dedicated platform or via direct deposit. Figure out a system that works for you and your tenants and be clear about it when signing lease agreements.
- Use E-Signatures for Everything
Speaking of signing lease agreements, all documentation should be handled electronically with e-signatures. Not only are e-signatures considered legally binding in almost every jurisdiction, but they allow you to speed up paperwork processes and keep all of your files in a safe and easily accessible place. (We recommend storing them in a cloud folder, like Google Drive.)
- Install Smart Technology
Want to have total control over your rentals without having to drive to the properties? Smart home technology is the answer.
Smart home technology has increased in quality and simultaneously plummeted in price as demand has increased and manufacturers have reached economies of scale. This means you can get your hands on things like smart door locks and thermostats without overspending.
- Build a Team of Local Professionals
There are times when someone will have to visit the property to handle a maintenance or repair task. If it’s not you, you’ll need a qualified professional to go in your place. We recommend having a team of local professionals and tradesmen on speed dial to handle any request you may have.
Take Control of Your Financial Future
Why let someone else control your financial future? By investing in rental properties, you can begin generating passive income at scale. And if you leverage the tips outlined in this article, you’ll never have to worry about your investments eating up your schedule or preventing you from living the life you want to live. We call this winning!