Owning rental property can be stressful. That call in the middle of the night saying the water heater burst can make you crazy! And dealing with a tenant who has excuses every month for not paying the rent creates anxiety when you know your mortgage is coming up.
Minimize the stress!
Whether you own rental property and are a savvy investor or an accidental landlord, here are a few tips to make landlording a little easier. and help you protect your asset.
1) Partner with reliable professionals.
When managing your own rental property, you will regularly need advice and help from several key professionals. You'll need consultation from a good attorney who knows landlord-tenant law and advice from your CPA about deductions and other tax related issues. You may need a good real estate professional to help advertise your property for rent. And very importantly, you will need a core group of honest, responsive contractors to take care of problems and emergencies in a timely manner. Not only will these folks take care of your property and keep your tenant happy, they will also keep you out of trouble.
2) Treat your rental property like a business.
Having a rental property isn't a side hustle. It's serious and you should treat it that way. Keep up with state laws that affect you and your tenant. If you don't, you are seriously increasing your liability. Manage your finances regularly so you are prepared for tax time. Know how much security deposit you can legally charge and how long you have to return that deposit and what damages you can realistically deduct for. Don't put your money at risk or your livelihood- it takes a lot of time to keep up with everything so just do it!
3) Take care of your property.
Don't be a slumlord! If something needs to be fixed, fix it as long as it's legit. Every landlord needs to keep a decent reserve for emergencies, repairs and expenses at each tenant turnover. Every few years, plan to have the home painted and replace carpeting. The better you present the home to potential tenants, the faster it will get rented, the more money you will likely get and the better they will take care of it. That's worth it!
4) Find a great tenant and develop an excellent screening process.
"Fish where the fish are" as they say... You need to advertise early (about 45 days before the current lease ends) and be smart about where you place those ads. Everything is online and that's where the renters are looking. Find the right websites and advertise there. Places like Zillow, Trulia, Craigslist and others will let you advertise you property and expose it to thousands of potential renters.
Once you get an application though, do a thorough screening. These tenants are going to live in your home and the last thing you want to do is chase them down each month for the rent or even have to evict them. Make sure they are qualified. Running an applicant's credit is not enough. There is more to the picture than just credit. At our property management firm, we run criminal checks, eviction checks, verify employment and past tenancy.
5) Have a strong lease.
You have more at stake with your rental property than your tenant. While you want to have a fair lease, you also need to make sure you are protected. Take a look at multiple leases and see what makes sense. Your local real estate board generally has a good lease you can review as well. Find one you are most comfortable with make any relevant modifications you want but have it reviewed by an attorney to make sure what you have would be enforceable in court.
Have a question related to your rental property? Reach out to us any time - we're happy to help!
