The Successful Landlord

The ultimate goal of investing in rental property is turn a profit. To make sure that you achieve that goal it is essential that you follow several critical guidelines. 

First, always make sure that you check references. This can be a burdensome step that many landlords overlook if they feel as though they have a good instinct about the tenant when they meet with them. Not checking references; however, can lead to a number of problems. You can uncover a wealth of information about potential problems before you rent to a prospective tenant. 

Always make sure that you have everything in writing. This is to protect not only your rights but also the rights of your tenants as well. Everything from the code of conduct you expect tenants to abide by while renting your property to the rental application itself should be in writing. 

You will find that you have better success with your rental property if you take the time to ensure that it is both secure and clean. The grounds of the property should be free of clear and trimmed regularly. Not only will the property be more visually appealing but these actions will also assist you with property liability. You will also want to take additional security measures. Extra security may be able to lower your insurance premiums as well as provide an incentive to quality tenants to rent your property when they know it is secure. 

Click Here to watch video, for more on how to be a successful landlord

If you make the decision to hire a property manager, take the time to interview prospective candidates very carefully. Property managers can be quite helpful if you do not have the time to tend to all of the details yourself. The wrong property manager; however, can cause you tremendous problems. This means that you will need to hire a thoroughly responsible and professional individual to handle the job. 

Always make sure that you obtain adequate insurance. Not only should you have property insurance but you should also have liability insurance. One incident is all it takes to wipe out your investment. Check with your state to determine if any additional insurance coverage is required. 

Regardless of the condition the property was in when you purchased it, there will come a time when repairs are needed. This is part and parcel of owning rental property. If you take too long to make repairs, not only will your property suffer and repairs will ultimately cost more to take care of but you will also likely lose quality tenants as well. By making sure that you handle repairs promptly you will be able to maintain the life of your property as well as retain good tenants. 

Always make sure that you follow all applicable regulations in the renting of your investment property. If you violate those regulations you could find yourself facing a lawsuit that is costly in terms of time as well as money. The best course of action is to take the time to do your homework and consult an attorney experienced in real estate matters for guidance regarding regulations as well as ensuring that you have the proper forms. 

Finally, make sure that you do not violate the privacy of your tenants. Check with your state’s regulations to find out whether you must provide any type of notice to your tenant before you enter the dwelling.

Repairs On Rental Property

There are some decided differences between fixing up your own home and a property you plan to rent out. One of those differences is often your budget for repairs. If you want to make a profit on your investment property, repairs must be kept to a minimum. Since repairs are also a necessity to attracting and maintaining quality renters, it is also important to learn how to make repairs on a limited budget. The good news is that there are some repairs and improvements which can be made to your property without spending a lot of money.

First, make a point to go through the house and replace all of the older and outdated switch plates. New switch plates need not be an expensive investment. In fact, most switch plates can be replaced for just a couple of dollars each, at the most. You can easily replace all of the switch plates in a property for around $20. In some areas, you may wish to go ahead and ante up for switch plates which are slightly nicer, such as in the living room and foyer. You will pay a couple of dollars more for brass plates; however, even at around $5 each, that is still not much money to pay for an improvement that can really make your rental property stand out.

Doors are another area where you can make a big difference in your rental property without spending a ton of money. Doors are one of the first things that a prospective renter will notice so it can really be a worthy investment to make when you are trying to attract good renters. While you are changing out the doors, be sure to also consider changing out the handles as well. Older door handles can really make a place look drab. For just a few dollars, you can easily replace those old handles with brass finished models. ‘S’ handles are popular for bedroom doors and bathroom doors and only run a few dollars more.

Another area where you might wish to focus some attention is the entryway or foyer. Keep in mind that once prospective renters step through the front door this is the first area they are going to see, so you want to make sure you make a good first impression. Tiling it can be a great way to do that. For a small foyer area measuring around 8x8 you can easily tile it for about $100.

Kitchens are one of the most important areas for most people when they view a property for rent, especially women. While it may not be practical to replace all of the cabinets, it can certainly help to paint them. Consider repainting them using a semi gloss white paint and do not forget to replace the knobs when you are finished. Even less expensive plastic knobs can breathe new life into older kitchen cabinets.

Rental Property Maintenance Checklist

Ideally, the best time to begin thinking about your repair and maintenance budget is before you actually purchase the property. One of the biggest problems for many rental property investors can be failing to plan for maintenance issues in their budgets. The simple fact is that regardless of how well maintained your property might be, things can and will break from time to time so the best course of action is to plan ahead and budget for it so you do not struggle later on. By planning ahead and budgeting for maintenance and repair issues you can make sure you are prepared when these items inevitably arrive and will not be financially surprised. 

First, you need to consider those repairs that can be foreseen relatively easy if you are observant. For example, take into consideration the age of the roof. Generally, by studying the condition of the roof you can usually determine when you will need to replace it, more or less. The same is true of the home’s main systems including the air conditioning system. By taking into consideration the natural lifespan of many of these items you can typically predict when you will need to come up with the funds for these replacement costs. 

Click here to watch video on rental property maintenance

When considering the potential repair and maintenance costs you may run into as you shop for property, it is important to take several factors into consideration. Property type should be one of the first factors you consider because the type of the property can affect repair costs later on. For example, if you purchase a brick property you certainly will not have to worry about painting it in a few years. 

The size of the property should also be taken into consideration. Smaller properties are typically easier and less expensive to maintain than larger properties. Larger properties are more expensive to maintain because it simply costs more money for repair and maintenance issues such as replacing the roof, repainting the exterior and exterior, etc. 

Surprisingly, the location of the property can also play a role in how much you need to budget for repairs as well. Take into consideration the distance of the property from your location. If the property is located more than 30 miles from where you are located, you are going to spend more money traveling to the property and that can add up quickly. 

Finally, consider how you plan to manage the property. Do you plan to handle most of the maintenance work on your own or will you hire help? Hiring outside help can be more expensive overall however, you must also consider the amount of time you have available for making repairs and your own skill and experience level. It is also important to remember that there will typically be some problems which will come up completely unexpected and unscheduled. You will need to make sure that you budget for these items as well so that they do not hit you too deeply in the pocketbook. 

Generally, it is a good idea to plan an annual budget of between 2% and 4% of the value of the property for repairs which may come up unexpectedly. For example, if you have a $100,000 property you would need to plan to spend between $2,000 and $2,500.

Coping with Loud Tenants

It is not uncommon for many renters to either play music quite loud or play an instrument. In the event that you own a multi dwelling property this can be even more of an important issue as other tenants in the building may not appreciate being disturbed by loud music. How you handle these issues is quite important because it involves a fine balance of maintaining happy renters and yet ensuring that neighbors surrounding your property are not disturbed. 

If you fail to handle the issue properly they may decide to rent elsewhere leaving you with vacancies and that can be expensive. Furthermore, your property may gain a bad reputation, making it difficult to rent to future tenants as well. When you are facing this type of problem there are actually several different ways that you can handle the issue.

First, it is imperative that you make sure you have discussed your property rules with tenants before they actually move in. This type of action can help to prevent problems before they even begin. 

Sometimes, checking on a property early in the morning or late at night is not feasible especially if you live a good distance away. In this case, consider asking your neighbors to advise you if your tenants disturb them with loud music or noise. Remember that it is always best for neighbors in the area to advise you about the problem so that you will have an opportunity to correct it before they contact the city or the police with their complaints. This will also assure neighbors that you are concerned about the neighborhood and maintaining a peaceful atmosphere for everyone. 

Once you have contacted your tenant verbally regarding the matter, make sure you follow-up with a reminder in writing. This should help your tenant to understand the severity of the situation and will also provide you with the documentation you need in the event the behavior continues and you must consider evicting them because of it. 

Ideally, the best way to handle this type of situation is to prevent it before it ever begins. Explain to your tenants when they move in that you regard the issue as serious and that you will check up on the property from time to time. If you decide to rent to students, this is especially important. By making sure that you have established a cordial relationship with your tenants early on they will be far more likely to respect your rules and understand where the line is drawn so they will not cross it. 

Ensure that you have included terms within your lease stating when exactly music may be played. You should also include in your lease statements indicating specific times when music may not be played so loudly that it can be heard outside the individual unit. For example, you might state that music may not be played before 8am and after 10pm. You should also make sure that these terms include not only music but also actual musical instruments as well as televisions. 

Properly managing a rental property means not only providing a pleasant living environment for your tenants but also ensuring that your rental property does not disturb others in the neighborhood.

Dealing With Problem Tenants

Having the right tenants in your property can truly make a huge difference in your ability to succeed in owning investment rental property. While problem renters can definitely exhibit some warning signs, there are some problem renters who are quite adept at getting past landlords. As a result, it is important to understand that you simply cannot always rely on your first impression of a prospective tenant in order to determine whether they will be responsible and reliable.

Here are some tips you can use in order to avoid tenants which could prove to be difficult.

First, always have prospective tenants complete a rental application. The application should be in writing and should provide you with the information you need to make a decision regarding renting the property. Along those lines however, you need to make sure that you always follow laws. Discriminating against prospective renters is against the law and could land you in quite a bit of trouble. You are not allowed to deny someone the ability to rent your property based on religion, race, etc. By following the law, you can make sure that you do not violate any discrimination laws.

Always make sure that you obtain proof of identity. This includes seeing a photo identification from any prospective tenants that you interview. On the rental application you have prospective tenants complete, make sure they write down their driver license information. Make a copy of the photo ID and be certain that you attach it to the rental application. Many landlords make the mistake of not performing a background check. This is a mistake that you cannot afford to make if you want to ensure that you avoid potentially troublesome tenants. Performing a background check gives you the opportunity to determine if there are any previous problems. For example, running a background check can let you know if a prospective tenant has a history of destroying property or skipping out on the rent.

Along with a background check, you should also perform a credit check. You will need to obtain the applicant’s permission in order to do this; however, you can do this on the rental application. You will also need to obtain the applicant’s Social Security number on the application to run a credit check.

References are also essential. Make sure that you obtain the name of the applicant’s previous landlord so you can follow up. This is because not all landlords make a report to the authorities when there is a problem, so by checking with the landlord directly you have a better chance of determining if there were any problems. Also ask for character references. Make sure that you take the time to actually check with those references. If the applicant did not give you a valid reference this is a good way to find out about it and weed out the applicant.

Finally, make sure that you include information regarding a code of conduct with each application or lease. The code of conduct should state what is expected of the tenant and have the prospective tenant sign and date the document. By making sure that these expectations are clearly outlined in the beginning, you can help to avoid a number of problems.