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Managing Your First Rental Property? Here's How to Guarantee Success

Getting into the rental property business is an exciting venture. Maybe you've been dreaming to become a landlord, and now it has finally come true. But like any business owner, you must be prepared for challenges. If you're not careful, you could get into legal trouble or lose tenants.

Here are helpful tips that will make your first investment a success. Keep reading.

1. Take time to find reliable tenants.

I cannot stress this enough. The kind of tenants you accept have a huge impact on your property. Vet them thoroughly. Don't rush the process — take time in reviewing their credit, rental history, and criminal background. Look out for red flags. 

2. Set the right rental price.

After paying all your rental property expenses, you hope to gain profit. That said, make sure that you price your rent right. Consider seasonality (time of the year). Is there an increase in the demand for rentals in your area? You also want to check other properties that are similar in size to yours. Get a realtor's opinion as well.

3. Learn the laws.

It's important for landlords to have knowledge on rental, federal, and local housing laws. Familiarize yourself with the Fair Housing Act before you start accepting new tenants. Being knowledgable protects you from being accused of discrimination. It ensures a good landlord and tenant relationship.

4. Touch base with your tenants.

Communication is key in just about any relationship. It shows tenants that you're staying on top of your game and that you want them to enjoy their stay. When there's a problem, it can be dealt with right away so it doesn't grow bigger.

5. Stick to the lease.

Your lease is your manual for handling every possible situation in your rental property. Whether the issue is about the rent payment or security deposit, you can always refer to the lease because your tenants have signed it. No matter what happens, you are simply following protocol. (Make sure that you use a lease that describes how you deal with every possible situation.)

6. Require tenants to have renters insurance.

Yes, landlords can require tenants to purchase their own insurance policy. Renters insurance protects a tenant's belongings in case they get damaged or stolen. This insurance will also keep landlords out of court. Because if tenants don't have it and they lose their belongings (due to theft), there's a chance that they'll file a claim against their landlords.

7. Reduce tenant turnover. 

Long-term tenants are valuable. Vacancies cost you both time and money. Although you cannot fully prevent tenant turnover, there are certain measures you can take that will make your best tenants stay. Strive to be a good landlord by staying on top of maintenance, responding to tenant requests promptly, and offering incentives for longer leases.  

As a new landlord, you're probably going to commit a few mistakes. But you can minimize them by educating yourself ahead of time. This enables you to create a solid rental property business plan. Get started today by checking out our landlording courses!

If you’re ready, make Landlord Prep your go-to resource for landlording education. Here, we offer a complete DIY landlording course to get you on the right track. Join our academy today. If you want, you can check out Flavia’s real estate investing webinar first!