7 Things To Know Before Becoming A LandLord

7 Things To Know Before Becoming A LandLord

Being a landlord seems like the sweetest gig in the world, doesn’t it? What’s sweeter than sitting home and watching house rent roll in from multiple tenants every month or every few months?

Being  a landlord  is not all it  is painted up to  be, though. It is a  serious commitment and a  lot of hard work. You might  want to pause for a second and  do your homework before shelling out cash to buy or erect a building.

To  be a successful  landlord, you need to be familiar with your legal responsibilities and right. On a personal level, you need be able to tolerate many different personality types and be adaptable to impromptu problems.

Here  are 7  important  things you  need to know  before becoming  a Landlord

  1.   Inspect  the property  before Purchase: One  of the  important  things to consider  before you become a  landlord is to thoroughly  inspect the property you intend  to purchase and note down what will  need to be repaired or replaced. Say,  you might want to change the toilets to  the latest designs, and as well do the same  to things like water, door locks, and flooring.   Most times, landlords are responsible for insurance and  taxes, and not to talk of expenses like garbage, gardening,  and regular maintenance. So one thing you don’t want to do is  to make the mistake of underestimating the costs of fixing and maintaining  the property before a tenant has moved in – and even after moving in.   
  2.   Choose  your location  carefully: How  big is  your pool  of potential  renters and what  is their economic muscle?   The answers to these questions  are determined by factors such as  the jobs available in the area and  even the lack of jobs. You probably want  to erect a residential building in a student-­‐heavy  area because students at higher institutions constitute  a rich renting pool. Similarly, a business district is a  great place to rent out office space. It’s all about demand  and supply.
  3.   Establish  A Network Of  Blue Collar Professionals: You  will be  well served  to build a network  of artisans including  electricians, plumbers and   carpenters who you can call  on whenever you need maintenance  services. Find people who are competent  and who you can trust with your precious  investment. Introduce them to your tenants  and encourage your tenants to patronize them also.      
  4.   Screen  potential  tenants: You  have surely  heard stories  of nightmare tenants  who are loud, destructive,  violent and who regularly  default on their rent. To avoid  these types on tenants, ask for references  from employers and former landlords of potential  tenants. Be thorough when you interview prospective tenants  to find out if they meet your requirements. To be safe, confirm  the source and amount of their income just to be sure they can keep  up with rent payment. Once you land yourself a great tenant, expedite the  lease signing process. Always keep in mind that you’re running a business and  your tenant is a customer.
  5.   It  Is Very  Rewarding Work: Sure, being a  landlord comes with a lot of head-­‐rattling  and struggles, but it also has  great rewards attached to it, in  terms of monetary value. There is also  this feeling of personal freedom that comes from being your own boss, and pride that comes  from seeing the financial rewards of your own hard work.   Asides that, being able to provide a home for another being  is an accomplishment in itself. More so, forging personal relationships  with your tenants is inevitable, especially if you share the same building  – you will experience tenants come and go, and watch their children grow, but  you can also take pride in the fact that your property has served as a home for  all these people, and will probably do so for years to come.
  6.   Budgeting  for repairs  is a good idea: Expecting  the unexpected  comes with the responsibility  of being a landlord, and that’s  why you should be prepared to set  aside some money for unexpected repairs  well. Subject to the condition of the lease  agreement, landlords can be responsible for some  property maintenance.

These repairs could include things like refreshing  a chipped coat of paint, fixing a broken toilet, a leaking roof or a clogged kitchen sink.

On  the other  hand, to avoid unexpected repair costs, you can take a proactive approach by doing whatever you can to  prevent problems from arising  in the future.

  1.   Run  the numbers.   Being  a landlord  can be profitable,  but you can easily lose  money as well. If you charge  too high for rent, you’ll scare  away potential renters, and if you  charge too low, you’ll shortchange yourself  and possibly run into debt.   

Factor  in all of  your costs, such  as your mortgage payments,  insurance payments, maintenance   costs, and the valuable amount of  the time you’ll spend putting everything  in place, then figure out how much you should  charge to make a profit.

Being  a landlord  is a dream for  a lot people, but  it is not something  to dive into blindly.  As much as you crave the  privileges, you need to be aware  of the accompanying responsibilities.   

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