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June 4th, 2012 by Eric Lui
The constant fluctuations of the housing market can mean many things in terms of property investment, rental rates and the life of a landlord. We know, for instance, that there is a higher percentage of renters in the United States than there has been in quite sometime. But what we haven’t addressed is that there are also more landlords.
Whether you have found yourself in a property investment deal that didn’t go quite as planned or you’ve moved to another house while your old property has sat on the market for far too long, you yourself may have already become a landlord due to a lack of options. The life of a landlord can be financially rewarding, but it can also be complex and draining with many rules, laws and advice to wade through. In this article we want to distill a few of the more important tips that will lead to a better life for both you and your tenants.
1. Have a Knowledgeable Attorney on Speed Dial
And we don’t mean your friend from high school who now works in criminal law or your neighbor who used to be a paralegal. You should find an attorney who specializes and is intimately familiar with landlord/tenant law and the evictions process. No one wants to think about evictions when you don’t even have a tenant yet, but the fact is that at some point you will have to deal with the process. If you develop a good relationship with an attorney sooner rather than later, it can save you a lot of headache and maybe a few bucks in the future. A good attorney can also help you by reviewing your lease agreement to make sure there aren’t any glaring errors or problems.
2. Consider Professional Property Management
It may seem like an expensive prospect, but the fact is that unless you live next door and can dedicate a significant amount of your time to dealing with your tenants, you will be much better off having the property managed professionally. A trusted manager can fix problems as they arise, collect rents and develop a professional relationship with your tenants so that you can go on living your life without the constant threat of a phone call with an emergency plumbing situation.
3. Set Expectations Right Away
Most landlords agree it’s important to set your expectations up front and not back down, even if it makes you uncomfortable at first. As a landlord, it is important to remember that while you may respect and even like your tenants, you are NOT friends with them. Insist that they pay their rent in full, on time, from the very beginning. This makes it less likely that they will offer up excuses in the future. You’ve become a landlord to recoup an investment, one way or another, and you won’t be able to do that unless you actually collect rent.
4. Find a Good Tenant Application
Having an application system in place before you even put out a yard sign for your vacancy will make your rental process go more smoothly. We find that an online rental application is much simpler to use than a paper form. You can collect all the information you need – including references, driver’s license number, credit check approval and a new tenant’s contact information – and keep it safely in one place online for future reference. Even if you don’t choose to go online with the process, make sure you have an application ready as soon as tenants start calling.
5. Choose Tenants Wisely
If you’re desperate to start generating income from your property, you may want to place the first person who shows an interest, but that is not the best idea. Screen your tenants, run a credit check on your tenants, interview your tenants, call your tenants’ landlords. Make sure they are trustworthy people who are not likely to destroy your property and run off in the middle of the night without paying rent.
Of course, being a landlord is not as simple as five easy tips, but keeping these tips in mind as you venture into the world of landlord-hood should make your new role a little easier.
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