Becoming a landlord may seem daunting and overwhelming at first; it’s a business, real estate, customer service, and handiwork. But boy oh boy, if you can hit a stride, the fruit is so sweet! We’ve compiled a handful of priceless tips to make sure you avoid the common pitfalls and take advantage of the easy advantages along the way.
After purchasing and renovating your property, this is the next most important step. If you don’t have a smart marketing plan to attract the best renters, you’re already limiting your potential. There’s got to be a method to your marketing madness. You might think splashing up your ad on every website far and wide will get you the best pool of applicants, but you’d be wrong. How and where you advertise your property says a lot about the kind of landlord you are, the quality of the rental, and the professionalism of your brand.
Eyes on the Prize
Once you start to get to know your tenants, the sob stories and excuses start pouring in, and it gets more and more difficult to enforce your policies. You need your rent checks coming in on time, every time. This is your source of income after all. You’ve got to stay on top of communication with tenants so that if payments grow later and later (or start to disappear altogether), you can either get to the heart of the issue or begin eviction procedures. If payments disappear and your tenants ghost you, that’s your loss.
Do Your Homework
The preemptive research you do now could save you countless headaches down the road. Be picky and be firm about your tenant’s credit scores, and always ask for previous rental references. Find a reliable and thorough credit background check, and love it hard. It never hurts to run criminal background checks, too, as well as a few healthy google searches just for good measure. Obviously, you also need to educate yourself on the fair housing laws. Petty discrimination is a pretty big no-no. But for bad credit, bad references, or bad criminal history, you are absolutely within your right to reject an applicant (and you probably should).
Property Managers are Godsends
Depending on your personal bandwidth and how many rentals you have, hiring a property manager can be a great move. A manager can handle basic maintenance, complaints, and almost all communication with your tenants. All you have to do is make decisions and collect rent (and pay your new manager’s salary). Crunch the numbers to find out just how much time the extra help would save, you might be pleasantly surprised.
Furry Friend Pros and Cons
Of course, you want to be the pet-friendly place because everyone so many Americans are pet owners. But let’s be practical. But what kind of screening process will you establish for allowing pets onto your properties? Photos? Testimonies? Meeting them in person? Do you only accept the cute fluffy ones? What about when you accept one small cat, and then suddenly a few months later, they’ve got a whole zoo in there? Think long and hard about whether it’s truly, worth the hassle. Especially cats, and especially if the place is carpeted. Need I say more?
Choose Home Improvements Wisely
Field tenant’s complaints and suggestions with caution, and patience. Resist making costly and/or timely renovations just for the sake of it. Unless something is broken or sub-par, you should have a crystal-clear justification for any rental maintenance. Try to prioritize renovations that will increase rent, especially in between tenants. You should also keep in mind what sort of neighborhood your rental is located in, and what the “standard” features seem to be in the area. You only have to be slightly better than your competition to justify a higher rent; don’t overdo it.
Much of being a landlord has to do with making smart choices from the get-go, in addition to sticking to your guns on a day-to-day basis. As long as you have a strong and informed foundation, you’ll be golden. Get out there and collect some rent, patch some drywall, and investigate that mysterious barking from your no-pets-allowed property. You’ve got this.