What would a poorly imagined day in the life of a landlord be like? Probably a chest-thumper raking is in by kicking their feet up on a desk, just waiting for their regular, monthly rent payment. Outsiders might also wrongfully link land lording to easy cash.
Sorry to hurt your expectations, but it’s not that way. Becoming a successful landlord means becoming a businessperson, and land lording is a job that requires the best of your part-time efforts, at the very least. Still there? Keep on reading to get the basics on how to be a landlord.
Understand the nitty-gritty of landlording
In simple terms, a landlord is someone who works in real estate and owns a property that can be rented by other people (tenants). There’s money involved, sometimes a lot when in sync with a prosperous career, yet not before settling several matters.
A successful landlord is cordial, yet assertive when they need to be–otherwise, they might compromise their efforts and lose money without intending to. Think of a landlord/tenant liaison as a relationship: if you’re not bold when things get out of hand (e.g. a tenant with multiple late payments), then people will walk all over you. However, personality alone won’t be enough.
You’ll need a solid lease agreement to protect your integrity and your job. Leases are very customizable and should follow your restrictions, so be forward with it. Indispensable clauses include a tenant’s responsibility to pay full rent on time and whether pets are allowed.
Invest in a convenient rental property, and inspect it regularly
A convenient rental property is often a profitable rental property, but there’s a fine line between convenience and profitability in this case.
Ideally, you’d buy a rental property near your home for expediency reasons–you never know when tenant complaints may arise. Plus, you should be nearby if you’re going to inspect the property often and spend less with commuting. The earlier you spot any damage to the property, the less you’ll pay in repairs and possible rent reduction due to poor maintenance. Negligence could also be a reason for termination of the agreement, so keep the place in check.
Keep in mind that the average rent price around the neighborhood directly affects how much money you’ll make, so do your research on the most profitable areas.
Be careful about who you let in
This isn’t supposed to sound menacing, but unfortunately, not all potential tenants are warm and fuzzy. Lucky for you, you’re alive at a time when you can pull their records and view pertinent information first hand without meeting them face-to-face.
Rule number one: screen your tenants. Skip this step, and you might end up with a troublemaker who’ll jeopardize your profits and peace of mind. There’s no reason not to do it. The process is quick and uncomplicated with the help of software from companies like Turbo Tenant, which collect people’s specifics in one integrated, easy-to-use channel. It makes your life easier by sparing you from the trap that does not know who you’re dealing with.
With tenant screening, you can gather the most important details from those who are interested in renting your property. They include not only essential info like full names, contact numbers, and monthly income, but documentation of past evictions and any criminal history.
Regardless of your need to rent the place ASAP, the urgency isn’t worth the risk of losing more money than you’re earning with unpaid rent or severe damage, so keep an eye out. Building this business is quite an achievement; therefore you should only open the doors to people who will keep it thriving.