Becoming a landlord is an exciting – but sometimes daunting – prospect. Apart from the fact that you are now in charge of a property and the people living in it, there are several other things to consider or pay attention to. Here are eight key things to avoid doing as a new landlord.
Failing To Get Proper Insurance
Landlord insurance is essential for any property owner. It will protect you in the event of a fire, burglary, or other types of damage. Make sure you have the right coverage in place before renting out your property. Additionally, if you’re using a property management company, they will likely have their insurance preferences in place.
Failing To Properly Vet Tenants
One of the most important things you can do as a landlord is vet your tenants properly. It means doing a thorough background check and asking for references. Although your primary concern is to fill your property, it’s not worth taking the risk by renting to someone who may cause damage or is hard to get along with.
Not Setting Ground Rules
Set some ground rules for your tenants early on. Doing so avoids any potential disputes down the road. You may want to consider including noise levels, guests, pets, and cleaning schedules. By setting expectations from the get-go, you’ll create a more positive living environment for everyone involved.
Not Doing Regular Inspections
It’s essential to carry out regular inspections of your property, both inside and out. The exercise enables you to catch any problems early on and address them before they become more significant issues.
It’s also a good idea to walk through your property with your tenants every so often, so they know what to expect and can alert you to any problems that may be developing. Make sure to regularly maintain the roof, gutters, and other exterior features of your property as well.
Not Setting Up a Payment Schedule
Remember to set up a payment schedule and stick to it. Doing so avoids potential disputes down the road. Decide on a date with your tenant when rent will be due each month and send out a reminder a few days before. You may also want to consider setting up a late payment penalty fee for those who don’t pay on time. To make the process more efficient and less stressful, avoid collecting checks and automate the entire process.
Not Being Organized
Organizing your office enables you to keep track of all critical documents, payments, and other information related to your property. Keep a file with all your essential paperwork and create a calendar to track important dates, such as when rent is due or any scheduled annual inspections. Having everything in order will help you stay on top of your responsibilities and avoid potential problems. To improve efficiency, invest in planning software to help you stay organized.
Not Being Responsive
As a landlord, it’s essential to be responsive to your tenants’ needs. If they have a question or complaint, address it as soon as possible. Being responsive creates a positive relationship with your tenants and avoids any potential conflicts.
Going Off Lease
When you have fantastic tenants, it’s tempting to go off-lease. After all, they are quiet, always pay rent on time and seemingly take care of the property. However, if you do this, you could be opening yourself up to all sorts of future problems. First, you are no longer protected by the state and federal laws that cover landlords and tenants.
Second, you’re implicitly telling your tenants that it’s OK to break the rules since they know you won’t evict them. Finally, if something goes wrong – they stop paying rent or start causing damage, for example – you’ll have a more challenging time evicting them.
It’s Possible To Run a Successful Venture
By following these tips, you’ll be well on your way to becoming a successful landlord. Avoiding these common mistakes will help you avoid any headaches down the road and ensure a smooth transition into property ownership. You’re assured of a profitable venture that’s less stressful well into the future.