Owning rental properties can be a great way to make some income. But don't mistake it for passive income.
Unless you choose to hire a property management company to take over the day-to-day management, you're about to take on a lot of responsibility.
Keep reading to learn a few landlord tips that can help you avoid some common rookie mistakes.
1. Set the Right Price on Rent
At the end of the day, the biggest thing that will make or break you as a property owner is your profits. And a big part of those profits is the amount you set your rent at.
New landlords often struggle with setting rent. If you're taking over properties from previous managers, they might still be setting rent far below the current market value.
If you're excited about your new property and confident that renters will love it, you might be tempted to set your rent too high.
Both situations will cause you to leave valuable profits on the table.
Take your time in setting rent for your properties. Research what other properties in your area with similar features are renting for. Factor in what the cost of maintaining the property is, as well as what additional things your tenant will pay, like utilities or lawn upkeep.
If you already have tenants in your units when you takeover, you might need to issue a new landlord lease with the higher rent amount.
2. Don't Befriend Your Tenants
Another common mistake new landlords make is wanting to be friends with their tenants.
But some of the best advice for new landlords is to always treat renters like customers. Be friendly and welcoming when they have concerns, but make sure that your interactions are always professional.
3. Learn to Market From the Start
Vacant properties take money straight out of your pocket. Actively marketing your properties is the best way to avoid vacancies. But many new landlords put off marketing in favor of other tasks in their new role.
Learning how to market your property right from the start of becoming a landlord can help you to avoid costly vacancies.
4. Always Screen Renters
You can trust your instinct when painting and sprucing up a unit before renting it. Don't trust your instinct when it comes to choosing tenants.
Just because a potential tenant seems friendly, reliable, and well-behaved doesn't mean that they are. Screening tenants can help you avoid a nightmare and a potentially costly legal situation when you have to evict.
5. Don't Be Afraid to Get Help
Whether you're managing a single property while working another full-time job or managing an entire portfolio, don't be afraid to get help.
Many new landlords are hesitant to do so because they think it will lower their profits. But professional property management can actually help you to increase your profits and reduce vacancies, which in turn means more money for you.
Putting These Landlord Tips to Work
These landlord tips can help you to avoid some of the common mistakes new property managers tend to make.
Looking for more help in mastering your new role as a landlord? Contact us today to see how professional property management can help you to maximize your profits and ease the stress of managing a portfolio of rental properties.