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Top Landlord Mistakes To Avoid

Top Landlords Mistakes

Owning real estate investment properties is a great way to make extra money, and some people are able to turn their properties into a lucrative fulltime business. However, those who are just starting out with real estate investing and who plan to become the landlord of the property run into problems quite often. The following are some of the top landlord mistakes you should avoid.

Mistake #1: Not Checking the Tenant’s Background Thoroughly

You need to know who is renting your property. You need to know more than their name and what they say they do for a living. Even though you might want to get a tenant into the unit as fast as possible, you have to take the time to do a full background check and credit check. Verify their former residences and their employment history. Just because someone has a deposit check that’s ready to go does not mean they will make a good tenant.

Mistake #2: Not Accounting for Vacant Properties

The goal is to have a tenant in your property and paying rent at all times. In a perfect world, this is how things would operate. However, the world in which we live is far from perfect, and that means that you need to consider what you will do if you have to spend a month, or several months, without a tenant in the unit. You need money available to cover the mortgage, and you need to find the time allotted to market the property and get another tenant to move into the house.

Mistake #3: Not Taking Care of the Property

It is very important that you consider the upkeep and maintenance of the property. You need to make sure that the unit or house is updated and that it is in good shape. When one tenant moves out, make sure you clean the carpet or replace it, paint the house, and take care of all of the other needed repairs before trying to bring in a new tenant.

Mistake #4: Not Getting a Contract

When it comes to real estate rentals, you can’t rely on a handshake and the word of the tenants, even if they are family or friends. You need to make sure that you have a solid contract so that everything is in writing. You don’t want anything to turn sour in the relationship with the tenant, but you need to have a contract in place just in case it does.

Mistake #5: Neglecting the Tenants

When the tenants have issues with the property, or anything that’s happening on the property, you need to attend to it immediately. If you ignore the tenants’ requests, they will no longer want to live in the home, or not take as much care of the property and you will be looking for new tenants before long.

Mistake #6: Not Charging the Right Amount of Rent

It is also important to make sure you are charging the right amount of rent. Look at the rental price of comparable homes in the area to get an idea of what you should charge. You do not want to charge a rent that’s too high because it will be impossible to keep tenants. If you charge too low, you will not have money for mortgage, repairs, and other necessities.

Finally, even though you might have the time and inclination to be the landlord of your properties, it could be much easier on you if you work with a property management company. These companies can help you to take care of all of the different aspects of the rental. They can market the property, help you find and screen good candidates to be tenants, take care of the contracts, collect the rent, and more. Their job is to make sure you have as few headaches as possible as a property owner.

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