Renting your home may not be as easy as it sounds.
Whenever you buy a home, you are always told what a great investment it will be. Even if you decide not to live there, they say, you can always rent it out and make a little extra cash. What they don’t tell you however, is that renting your home out comes with a slew of potential complications.
You may wonder how good landlords turn into slumlords, but years of dealing with late rent, bad tenants, and damaged property can turn even the most well-intentioned home owner into a nightmare landlord. So, in the interest of optimism, here are a few tips on how to be a successful landlord.
Charge a fair price. The biggest pitfall you may face as a landlord is determining the right price. You don’t want to charge too much, because you will end up with unhappy tenants, but you don’t want to charge too little because the point is to turn a profit. Check out local policies and rules for your particular building, and do research on other listings in your area so you can determine a comparable price. Obviously if your home comes with brand new features or a renovated interior you can charge a bit more, but make sure your price is fair market value, or you may come to regret it later.
Treat your rental property like a business. Remove any and all emotional attachment to the place, and leave any emotions out of your communications with tenants as well. If you are respectful and professional about the space, hopefully they will be too.
Keep an open line of communication. The worst thing you can do as a landlord is to ignore your tenants or be completely unreachable. If you hire someone to manage your property, make sure they are giving you weekly or monthly updates on how things are going. If you are doing it yourself, make sure you are open and communicative with your tenants, especially regarding any maintenance issues.
Make sure you have the right insurance. Do research on the rental laws in your state, and get the maximum amount of insurance for your property. You will thank yourself later, if something ends up going wrong.
Make a list of vendors. If you are managing the building yourself, assemble a list of plumbers, electricians, and exterminators (getting recommendations from friends is always a good way to start). Also, make sure you have trusted backups in case your first choices aren’t available. If one of your vendors is a no-show more than once, or is often late, replace him as quickly as possible. The biggest source of problems between tenants and landlords often comes from the service workers they hire.
Set up online payments. I can’t stress enough how important it is to make it easy for your tenants to pay you. There are many ways to accept payments in this day and age, so you can find the right solution for you.
Keep records of everything. Keep all your leases, service contracts, and receipts in one place, readily available at a moments notice. If you have any communications with tenants, keep these as well. God forbid, if you ever get dragged to court you should have your ducks in a row.[ via ]