For first time investors, the thought of being a landlord can be intimidating. There are so many factors and many unknowns. How do you choose the right tenant? How do you ensure they pay their rent on time? What do you do if they violate terms in the lease?
While these questions can be unnerving to a first-time landlord, there are a few helpful tips that industry professionals will suggest that will help you get through the process.
Before you jump into any business venture, you should always know the laws that govern the situation. When it comes to being a real estate property investor, you should always be familiar with the tenant-landlord laws. Every state is different and depending on where you invest, you may need to be familiar with laws that are different from where you reside.
Don’t be fooled by first impressions. When trying to decide on a tenant to reside within your property, make sure you are especially diligent. Compile interview questions before meeting with them. Ask for a full application and permission to check both credit and background. Having an application fee will also help weed out unsavory potentials. Make sure to actually check their references.
When it comes to rental payment collection, nobody wants to trek around the county knocking on doors and collecting checks. Having systems in place that allow tenants to pay their rent digitally is easier on both the landlord and tenant and is a check in the plus column when possible tenants are considering your property.
Having a digital form of contact for any maintenance requests is also a plus for both landlord and tenant in today’s technical world.
Treating the property like a business, rather than a home, will help you stay aggressive in doing what is best for your investment. This includes not renting to family and friends and keeping tenant-landlord relationships strictly professional, regardless of how long they reside in the house. While this may be a hard habit to get into initially, it is the best way to maintain a professional stance and make sound, unbiased judgements regarding the property.
If you are going to be conducting landlord services yourself—meaning you won’t be hiring a property manager—make sure to invest in property within close proximity to your own home. Being close will allow you to keep an eye on the property and be aware of any issues which may be arising. Living near your investment property will also be beneficial if any emergencies occur, as you won’t have to add travel expenses or time off work to the cost of correcting the problem.
If you are going to be hiring a property management company, proximity isn’t an issue. You can invest in property in any market.
Being a landlord for the first time can seem complicated, but with a little research and a strong will, you can settle into a groove quickly. As with anything in the real estate investment industry, if you don’t know how to handle a situation, there is a vast network of real estate professionals both locally and digitally that are willing to help mentor you through the situation. Following these tips, and the advice of any real estate professionals you have in your network, will help you to provide the best service to your tenant while protecting your asset at the same time.