Education and news for smart DIY landlords!
Owning a rental property as a business is a good investment. There are some perks of running a rental property business and there are also headaches. Some people are good at it and some are not.
To be a successful landlord requires a lot of specific attributes. Commitment and patience are only some of those. Before you spend money to invest in real estate, ask yourself, “Am I really cut out for this?”
We've made a list of reasons why becoming a landlord may not be the best option for you. We've made some points to consider and reflect on before you get into the landlording scene. Keep reading.
Landlords should be familiar with every aspect of the renting business. That includes tenant liabilities, technicalities, budgeting, and management. The processes involving it are long and contain lots of paperwork. You have to know the law, consult attorneys, and calculate the possible expenses. If you don’t like doing these kinds of stuff, it's best to consider some other form of investment.
This means you have no time to conduct monthly inspections or chase after due rents. Actually, these are just a few of the things that will require your time and attention. You may have some other important matters to attend to and forget your responsibilities as a landlord. It can be work, other businesses, family matters, etc. If you still want to become a landlord but have no time to look into things, consider the possibility of hiring a property manager.
Let’s say that a water pipe exploded or a tenant complained about a roof leak. Those would require a repair ASAP. Some people choose not to hire repair services because they're expensive. There will also be times when these services aren't available. Who else do you call? Nobody. You have to fix the problem yourself. The question is, can you? If you can't, are you willing to learn some DIY repair techniques?
What if there are damages that can’t be fixed and will require replacement? These circumstances are inevitable. Let's face the reality: There will come a time when you're going to pay out of your own pocket to keep your property in a good condition. If you don’t have savings for emergencies, then landlording is not for you.
Tenants will call you anytime about anything regarding your property. It can be during your working hours, when you’re asleep or during the holidays. If you get pissed off or put the phone on silent mode then that's a clear indication of being a bad landlord. It is a landlord’s duty to always be available whenever his tenant needs him to be. If you can't do that, consider some other form of business.
Landlording requires social interaction. Some have been mentioned above (chasing rent, phone calls, and addressing concerns). There’s also a thing called “tenant-screening”. It's the process of interacting, observing and gathering information about a tenant to determine if the tenant should be allowed in the property. If you’re not good at dealing with people for whatever reason or you're not willing to improve your social skills, landlording isn't for you.
This is a follow-up to the point above. There are landlords who are too sympathetic/lenient or too rude/unprofessional to tenants. Either way, both are bad for business. Why? A lenient landlord will allow tenants to take advantage of them by breaking the lease agreement. The unprofessional landlord will scare good tenants, promote disharmony and trigger lawsuits -- and they're not cheap.
Landlording is just like any other business. You just can’t invest money and expect things to flourish on their own. You have to make an effort to learn, be prepared for challenges, and stay firm. Is landlording for you?
If you’re ready, make Landlord Prep your go-to resource for landlording education. Here, we offer a complete DIY landlording course to get you on the right track. Join our academy today. If you want, you can check out Flavia’s real estate investing webinar first!