By Julie Kershner
Let's Start With The Basics
Numerous articles have been written on the growing trend of individuals purchasing second homes, not only for recreational use, but also for investment purposes. Recognizing that most vacation property owners do not have the time, resources or desire to manage a property, let alone handle rentals, a Property Management Company may become an essential player in your investment strategy. You may also want the property to start generating cash right away, but you want to be careful to do everything right.
Get 3 recommendations of reputable Property Managers from your local Realtor and interview the prospects using the following checklist:
- Does the Management Company co-mingle funds from different owners?
- Does the Management Company prepare an annual budget on your property?
- Does the Management Company have a good understanding of the Condo By-laws?
- Does the Management Company provide online access to your account?
- Do you have the option to pay fees online or by automatic transfer?
- Does the Management Company provide 24/7 emergency services? Does the Management Company attend HOA/Condo meetings?
- Do you get courteous responses from management company employees?
- Does the Management Company schedule routine maintenance checks?
- Do you receive reasonable and fast response to phone calls and e-mails?
Check Your Property. If you’re unable to make unannounced visits, ask a trusted friend, or your local Realtor to check your unit to insure the property manager is maintaining it, and, more importantly, isn’t renting your unit and pocketing the money.
Pay Your Real Estate taxes. If you are renting your vacation property in Mexico, it is your responsibility to pay income taxes to Mexico. You must first obtain an RFC number, which is similar to a Social Security number in the U.S. A benefit to having an RFC# is the ability to obtain facturas for home improvements—which may be deductible when the property is sold.
Check Local Zoning Regulations. Check the local zoning regulations and development Covenants, Codes and Restrictions to determine the legality of renting the property.
Location, Location, Location. his is especially true in vacation rentals, with beachfront, or at least a great view and amenities, such as a pool being, almost a requirement.