What Every New Landlord Should Truly Know
If you find yourself in possession of some extra and unused property, you might consider renting it out and becoming a landlord. You can make some serious income this way, but you must be aware of some considerations which could either harm or help your burgeoning new career. The life of a landlord is one of business trust, taking care of variables and sometimes engaging in difficult relationships with tenants gone awry.
We’re here to offer the new landlord business and property owner to capitalize on their assets, and to gift them foresight in their new career. Landlords must know what they’re getting themselves into. With the right attitude, the right funding and the right knowledge, your career as a landlord is sure to be successful, and to expand to a wonderful point.
Without further ado:
Proximity
Preferably, it’s worthwhile living new the property you are earning income from. This allows you to attend any issues, both maintenance and otherwise without having to spend an entire day simply making your way to the property. It also allows you to be more reactive and potentially spend less on solutions. For example, if the fuse is switched in a select flat’s electricity circuit, hiring someone to come and fix the issue could be costly with all the added callout charges. If you’re able to, simply attending the property and switching or replacing the fuse could work just as well. Make sure you have a degree of competence in these fields before you mess around with them however, as it’s never worth injuring yourself in an effort to make money.
Use A Letting Agent
It can almost be a no-brainer to use a letting agent to rent your property. Some landlords prefer to set up their own limited company and operate from that itself, but often this means taking care of all of the issues a tenant might face, and this is not always a practical solution. Letting agents often offer a range of services, for an agreeable fee and chunk out of the monthly rental instalments. For example, they might find it easier to enter security deposits in security schemes, which is a legal must in some countries.
They can also serve as a centralized hub to take care of all contact with your tenants. They might have better grounding to apply for lawsuits regarding tenants who fail to pay. They also have secure accounts which allow for safe storage of your tenant’s payments. They can draught contracts up at a moments notice, and market your property to a wider range of tenants.
Possibly their best use is the ability to vet certain tenants. Looking into the credit history of an application, as well as their proven income allows you to make wise and sensible decisions. For example, an tenant might be able to show you bank statements which seem reasonable and suitable for your apartment. However, vetting the application might help you find out they left their previous rental property completely damaged and with a two months rental arrears. If you’re in an environment with a competitive housing market, this could be one of the most important checks you can make, saving you plenty of headaches further on. Never be afraid to turn people down. After all, you are running a business and not a charity.
Know All Responsibilities Of Both Sides
It’s important to know where your duties as a landlord lie. It’s also heavily important to know what a tenant should expect to do. This will help you draw up contracts, time the rental payments and set them appropriately, as well as what forms of notice to give when interfering with their living space or the contract. We’d recommend checking out this wonderful resource if you’re looking for comprehensive clarity on this subject: www.propertyguru.com.my/resources/to-rent-guide/renting-a-property-deposits-recurring-costs-tenancy-agreements-and-responsibilities. Here you can find what to expect, how to behave around certain money matters and legal advice when renting property.
Some Tenants Will Be Just Terrible
The curse of landlords is a tenant which flips and acts out of character. You can vet a tenant all you like, but until you can read someone’s mind (who wants that anyway?), you’ll have a really difficult job completely and totally trusting the character of a tenant. Over your years of acting as a landlord, you will see some worrying habits from your tenants.
It’s not uncommon for landlords to find their property damaged during parties which have gone out of hand, or a tenant acting as if they own the property, getting work done and redecorating the whole aesthetics of the rooms, despite only having three months left on their contract.
It might even be wise to expect a few dates in court at one point or another. This is why you must keep everything above board, and keep note of the entire business deal from start to finish. You must back yourself up with your legitimacy from all aspects of the business dealing, keeping contracts, photographs of the properties, letting agent vetting reports, any property changes and lack of arrears. Any police reports or noise complaints you receive must also be documented. We recommend keeping a file on everyone you rent to, and filling out this file with relative paper or digital information to update your knowledge and approach to dealing with each one.
Some Tenants Will Be Fantastic
While terrible tenants make the vocal majority because they kick up such a fuss, most people are great tenants and simply want to live in peace within the property. This is why it’s important to forget approaching your clients with constant suspicion, despite the issues we have written in the last few paragraphs.
Most tenants will pay their rent on time, be happy to see you, and welcome you if you need to visit the flat. They will be quiet, respectful, and keep the place clean. These tenants are worth their weight in gold, meaning it could be worth attending to the big maintenance tasks quickly and helping them feel comfortable with the solution in order to retain them. There are worse things than a wasted and underappreciated rental space, but must better than than someone who’ll destroy it. Still, having it filled by someone you genuinely respect and like can make your life as a landlord a million, billion, trillion times easier.
Enforce
Sometimes you have to enforce the rules with a firm word. If someone is late on rent regularly, you can’t be afraid to address this issue as soon as you’ve noticed it.Even if the rent was day or two past deadline, they are breaching contract if they didn’t speak to you to warn you about this. Never be afraid to ask questions of your tenants if you’re worried. Never be afraid to draft eviction notices if a tenant fails to pay regularly. To be a competent landlord, you should be a respected landlord. This sometimes means enforcing the terms of your contract. This is your business, after all.
Have Patience
Remember, being a landlord might mean it takes a while to start making profit, especially after upgrading apartments. If you’ve priced them reasonably, they’ll slowly begin paying for themselves. It might take a timeline which requires patience, but it will happen. Landlords are often seen as meddling people without morals, but for the most part if you leave them alone and pay, they will leave you alone. Be one of this number, and you’ll foster positive relationships with all you rent to.
WIth these tips, your life as a landlord is sure to be enjoyable, and most importantly, profitable.
Featured image source: Pexels
