Life as a landlord can look sweet and glamorous from the outside, but don’t be fooled! You’ll need to invest a lot of time and energy to keep your properties up to par, and to keep your renters happy. Plus, there’s insurance, legalities, savings, emergencies, politics, and awkward conversations to be had. However, the payoff is huge, even though the job isn’t for everyone.
Take some time to make sure you’re cut out for the role, and just keep reading.
You Will Still Work
In a perfect world, landlords would rarely ever interact with their tenants and collect rent in full, on time every single month—with minimal work. Wildly appealing? Yes. Realistic? Not really.
When there’s an overflowing toilet at 3 am, mold in the shower, or (heaven forbid) a hole gets punched in the wall, it will be your responsibility as the landlord to take care of it. You will be expected to handle any major renovations and repairs post haste. Much of this can be alleviated by hiring a property manager, but that’s another huge decision to think about separately after you’ve gotten a feel for the job.
Hopefully, you have an abundance of handyman skills at the ready to fix the minor things. However, you’ll still have to call in the pros for the big stuff. All these major repairs incur additional cost, which comes directly out of your rental income so max sure you have a stash of cash for anything that goes terribly wrong.
Get Clear on Expectations
It’s your place so you get to make the rules. When you’re drafting your lease, be as specific as possible and think about every variable. Pets, visitors, smoking, noise—all of it. Be sure to make your rental expectations crystal clear—it’s okay to be strict. In fact, it’s encouraged, and you’ll need to enforce the rules if the property is occupied. If you give your renters an inch, they will take a mile. This isn’t to say that your tenants will take advantage of you, but everyone has their own best interest at heart.
You have the power. Put it all in your lease or be forced to suffer the consequences later.
It’s a Business Relationship
New landlords often fall into the trap of being way too nice (ahem, forgiving) with their renters. From the very start, you’ve got to be extremely selective when deciding who you want to sign your lease. Additionally, you’ll find that the riskiest renters can give you the most charming, lovely impressions. Don’t be fooled. Give yourself peace of mind and utilize SmartMove resident screening when conducting background checks on potential tenants. From credit checks to criminal records to rental history, you can be confident that all the information is on the table when making your decision.
Even after you’ve signed the perfect tenants, you’ll have to work to maintain a graceful and professional relationship with them. Becoming a landlord is the same as opening a business, and you’ll be wise to treat it as such.
You Are the Boss
It’s so easy to make friends with your tenants, especially if you’ve recruited them wisely and end up with wonderful people in your rentals. But, even wonderful people have their flaws.
Be wary of becoming too buddy-buddy with your renters, as you are still in charge at the end of the day. You must be firm in your decisions, and you still must insist on timely rental payments and follow the rental agreement to the letter. Making “one-time” exceptions for your favorite renters is a slippery slope.
Scary advice aside, becoming a landlord is well worth the investment. In all reality, you will meet all sorts of interesting and cool people, you will learn a lot about yourself, you will gain confidence and management skills (even if you thought you had those already), and your financial returns will bloom more and more every month.
The initial startup phases of introducing renters into your life are guaranteed to come with growing pains. Just don’t be discouraged by them.
If you’ve done your research and have taken all the appropriate legal and financial steps, you’ll be a successful landlord before you can say “sign right here.”