Education and news for smart DIY landlords!
Landlording comes with a ton of risks, as with any business. To make the most out of your landlording experience, you need to protect yourself from many things. These are rental income loss, problem tenants, lawsuits, and property damage. Minimize the risks of running a rental property business by following these tips.
Landlords need tenants to make money. But while having no tenants is a cause for worry, having bad tenants can be traumatic. Late payments, accumulating utility costs, and evictions. The list goes on. The best way to prevent bad tenants right from the start is to screen them properly. Create criteria first. Verify their identity and income sources.
Read More: 6 Traits That Make a Good Tenant
More and more landlords are opening their rental apartments to renters with pets. The majority of renters happen to be millennials and most millennials are pet owners. If you decide to welcome pets, you can reduce risk by charging a refundable pet deposit. State in the pet policy that the deposit will be returned if nothing gets damaged in the unit.
When it comes to getting repairs done, choose someone who is qualified for the job. Whether you need a roofing contractor or painting contractor, check his license board. This certifies that the person has knowledge of the best practices and that the service is worth paying for. Start by asking around. References help! Read reviews and compare estimates. Here's a helpful guide on finding and hiring maintenance workers.
A friend of mine who happens to be a new landlord opened up about one of her tenants saying that an insurance isn't necessary. Even if your tenant doesn't have a lot of belongings, renters insurance still provides liability protection in case someone else (a friend or family member) gets injured in the unit.
Do you keep all your important rental documents in one safe place? Important files include but are not limited to the following:
Categorize your records especially if you run several rental units. In a previous post, I discussed 3 basic record keeping systems.
Sometimes all it takes to encourage tenants to respect your rules and care for your rental is to treat them right. If a tenant has an issue, be sure to attend to it. If you need to enter the unit to show it to a future tenant or conduct some maintenance, be courteous enough to let your tenant know in advance. Unless, of course, it's an emergency.
No matter how you try to avoid it, at some point you will have to deal with unexpected expenses. Start saving up for emergency situations in your rental units. Set aside money to prepare for a major setup like storms or careless tenants. Make sure that your emergency fund is realistic. If you have multiple properties, they'll require more funds.
Want to be a successful landlord?
I offer you the opportunity to take a complete DIY landlording course: Landlord Prep: Video E-Course and How-To Tutorials. Everything you need to know to become not just a landlord, but a successful landlord, is here.