Embarking on your journey as a new landlord can be a rewarding endeavor that offers financial stability and an opportunity to build wealth. But as with any new venture, becoming a landlord can be challenging. To shed light on this journey, Apartments.com has gathered advice from tenured landlords to provide you with valuable insights for navigating the rental world.
Key Tips for New Landlords
Don’t Skip Thorough Tenant Screening
Several tenured landlords highly recommended screening your tenants before they sign the lease. This includes credit, criminal, and eviction checks. Luckily, with Apartments.com, you can quickly screen your tenants when they apply for your property, and the screening consists of previous evictions, criminal history, and credit risks.
Create a Clear and Comprehensive Lease
Your lease agreement is the formal agreement between you and your tenants. As a landlord, your lease is your legal protection. According to one seasoned landlord, they recommended: “Be friendly and welcoming, and lay down your expectations ahead of time.” Welcome any potential tenants, but your lease is your expectations, so be sure you have a thorough one. If you decide to use Apartments.com Rental Tools, you can build a fully customizable, state-compliant, and legally binding lease that can be signed in minutes. If you would like, you can also add stipulations to the lease so you can customize it to your own rules or even upload your own lease. Remember, it’s best to speak with a real estate attorney before you make any changes or upload your own lease.
Responsive Communication Builds Positive Relationships
Open communication with your tenants can resolve any issues quickly, leading to you building a good relationship with them, and they will be more willing to renew their lease. You can communicate with your renters by giving them your email or phone number but be sure to answer them promptly. One tenured landlord said, “Stick to the [lease] and don’t become too friendly with tenants!” Stay professional with your tenants. Don’t become too friendly or you could run into challenges you could have avoided. Becoming unprofessional with your tenants may lead to them or even you breaking the lease, so be sure to talk to a lawyer before you do any favors for your tenants.
Overcoming Challenges
Prepare for the Unexpected
It’s easy to walk into your new venture with rose-colored glasses, especially when trying to build wealth. But remember anything can happen, from natural disasters and storms to property damage. Plus, it will take some time to profit from your rental home. One tenured landlord recommends that you “assume that everything will take longer and be more expensive than you planned initially, then assume profits will be lower.” Not only will this assumption help you be prepared for unexpected costs, but it will teach you patience when it comes to being a landlord.
Become Well-Versed in Local Laws
Research is one of the most critical steps to help you become a successful landlord. Another landlord said, “The most important advice I would give to someone becoming a landlord for the first time is to do your research. There are a lot of laws and regulations governing landlord-tenant relationships, and it is important to be familiar with them. You should also learn about the property management process, including how to screen tenants, collect rent, and handle repairs.” Learning your local and state laws will not only protect you but your property as well. If you have any questions about landlord-tenant laws, speak to a local real estate attorney.
Budget Wisely
Creating a budget is essential for tracking your expenses, such as inspections, pest control, insurance, mortgage payments, and routine maintenance. Another well-tenured landlord recommends “[that you] have a fair amount of cash available for unexpected repairs or maintenance.” Things happen, especially regular maintenance such as changing HVAC filters or clogged drains, so it’s best to prepare yourself so you can fix the issue for your tenants instead of having them wait and not retaining them.
Becoming a new landlord involves a learning curve, but you can set yourself up for success with the right advice and strategies. You can establish positive relationships with your tenants by prioritizing thorough tenant screening, clear lease agreements, and open communication. Furthermore, by preparing for emergencies, staying informed about local laws, and budgeting effectively, you can navigate any challenge you face.
