Rental properties are great investments, especially in today’s housing market. But in order to become successful as a landlord, you will need to make your tenants happy. Managing rental property is as much about the people as it is about making sure that the building is properly maintained, but there are many more aspects to being a successful landlord. Here are some tips that will set you apart from the “average” landlord, and help make your business easier to run and more profitable.
Tips for Landlords
1. Check references. Don’t rely solely on first impressions or instinct when meeting a new tenant. People who seem great at first impression can become a nightmare in the future, so checking them thoroughly before signing a contract is important if you want to avoid any future headaches. Besides the credit history and background check, always ask tenants for references as well as a list of previous residences and follow up on them.
2. Keep records. In order to succeed as a rental property owner, you must know how to manage your property. Managing a rental property is a lot more difficult than managing a single-family home, so handling your finances in an organized way is the only way to make it in this business.
3. Have a policy. In order to protect your interests and the interests of your tenants, you will need a written agreement that includes the terms and conditions of tenancy. Make sure that this agreement includes many details, such as rules about pets and smoking in the rented unit.
4. Stick to your policy. Being organized is not only more beneficial to you and your business, but it also makes a good impression on tenants. Having a written policy makes your life and your tenants’ life a lot easier because you won’t have to explain yourself each time a tenant asks you why something is not allowed. If you have a written policy, you can just refer people who have questions to the document.
5. Provide quality. If your rental property offers quality, then quality tenants will be attracted. You don’t have to go overboard and invest significant money in remodeling, but providing above average quality will set a standard for the type of tenants that you want to attract.
6. Hire help if you need it. Doing everything by yourself can save you money, but it can also turn into a full-time job. Your involvement in the daily operations depends on how handy you are with repairs, how much time you have, and how close to the rental property you live. If you feel that being a landlord is taking too much of your time, you can always hire a property manager that can take care of the daily issues. This will cut into your profits, but it can also save you time and aggravation.
7. Do regular maintenance. Catching a problem with your rental property early on can save you quite a bit of money. Problems with the roof or the water heater can quickly escalate and cost you thousands to repair. Keep a log of all the appliances and fixtures, the times when they were changed, and when they need to be replaced. This way, you can shop around for better prices and take advantage of sales.
8. Have an emergency fund. Unexpected vacancies or repairs can happen at any time, so it is recommended to have some emergency cash on hand. When things break on your rental property, it is your duty to repair them as soon as possible, and not being able to may attract some trouble with your tenants.
9. Know the local rental laws. Many landlords get into trouble because they haven’t familiarized themselves with the local law. One of the biggest reasons that landlords are sued by their tenants is the security deposit. If you don’t follow the local law, you might end up having to return a tenant’s security deposit even if the tenant has damaged your unit.
10. Set contact hours. Let all your tenants know when you are available, so you won’t end up having to make repairs at night or during holidays. You can also set up a voicemail, so when a tenant calls outside of office hours, he or she can leave a message. However, it is recommended that you allow potential tenants to call at any time when you try to rent out a unit.
Taking care of your responsibilities with the unit and tenants as quickly as efficiently as possible is beneficial to everyone. Being a successful real estate investor and landlord boils down to being a good business person and keeping your tenants happy. By having the right attitude and knowledge, you can quickly turn being a landlord into a very profitable business.