There are a lot of benefits to becoming a landlord, especially if you own extra properties that you are looking to monetize. That said, there’s a lot of problems that can arise if you are new to the realty industry. If you’re thinking of becoming a landlord or if you’re new to the landlord game, these tips can help you avoid some of the headaches that come with the territory of managing rental properties.
Screen, screen, screen
You might think that listing “screen” three times is a little much, but it bears repeating: you must screen your tenants before ever signing a rental agreement. A full and proper background check includes credit scores, a job history, and any crimes a potential tenant may have committed. Do not take these results with a grain of salt, or you may end up in an unfortunate and uncomfortable situation when rent is due. This may sound like a lot of work, but with services like an online rental application available, you can quickly and efficiently find a great tenant and peace of mind.
Housing laws exist for a reason, and it’s important that you follow them. These regulations govern both tenant behavior and landlord behavior, so it’s vital that you understand the ins and outs of these rules. Not knowing about fair housing laws is no excuse not to follow them, and that could result in serious penalties for you and your new business. Do the work and read up on these laws so that you can avoid this major headache. Your wallet, and your tenants, will thank you for doing things above board and with all parties’ interests in mind.
Make tenants get renters’ insurance
While renters’ insurance is generally thought of as protection for the renter and not the landlord, there are benefits that a landlord gets by requiring their tenants to obtain insurance. While you’ll have property insurance as the owner of the apartment or home, it is possible that a renters’ negligence may ultimately cost more than your policy covers. In cases where flooding or fire is the fault of the tenant and not an act of God, having two policies to absorb the cost of damages and repairs is invaluable for new landlords who are still getting their feet wet.
Don’t wait on repairs
Many tenants know the pain of having to wait on a landlord to repair things in a timely manner, but few consider the negative effect that has on the landlord. As a new landlord, it is imperative that you maintain the quality of your rental properties. One way to ensure this is to get to any repair requests promptly and have them handled by professionals. While it may be tempting to fix a leaking sink yourself to save money in the present, in the long run having a professional manage the repair will save you repeat trips to the hardware store or more costly repairs down the line.
Don’t forget that you’re in this to make money
Rent needs to be a priority for you. Without tenants who will pay their rent in full and on time, you have no revenue source. You may be tempted as a new landlord to be lenient with tenants if they have a story about their hardship. It’s only human to empathize with others, and yet you must remain firm in these types of situations. You and your tenant entered into a legally binding contract that spells out terms such as when and how rent is due. Staying strong and losing a tenant, no matter how emotionally taxing it may be, will ultimately keep your business sustainable for others renting your property.
It is possible to have a fruitful career owning and renting your own properties, but it is not a decision to be made lightly. With the right information, hard work, and care, you and your tenants can have a long-lasting relationship that provides you with an excellent source of income. Keep the above tips in mind, and you’re bound to find success in your new endeavor.