There is nothing better than making mistakes to learn lessons, but I’d like to help you avoid some mistakes by sharing with you some of the most common pitfalls that landlords fall into. Hopefully these tips for landlords will help save you money and headaches.
5 Pitfalls and Tips for Landlords to Help You Avoid Them
1) Thinking you have to fill a vacancy now!
As landlords, the idea of a vacant unit can often send us into an emotional state. It is easy to drop our standards and requirements when the phone isn’t ringing. We weigh the fact that we have no cash coming in to cash in hand – isn’t cash king? Well, often when we take the fast cash we pay for it on the backend when the tenant becomes habitually late or even stops paying altogether; if we had only taken our time and done the due diligence we would have uncovered that this tenant wasn’t going to be ideal. So, set guidelines and rules under which you will take a tenant and stick to it. We all know a bad tenant can cost a heck of a lot more than a month’s rent, which is why this tip for landlords is so important.
2) Getting emotionally attached to tenants:
This pitfall is one that has always been hard for me. There is a level of respect and trust that can be built without having to get buddy, buddy. In fact, I recommend that if you manage your own properties that you never use your home phone, address or even have the properties under your name (always use an identity). Of course someone can find you if they really want to, but just don’t make it easy. Create a set of guidelines for you and your tenants and stick to them. If someone is truly down on their luck, there are programs in every city to help. In fact, I’ve been paid rent by the Salvation Army more than once. Help them find a solution, don’t be a temporary solution.
3) Not keeping up with maintenance of the property:
It isn’t fun spending money on general upkeep of property. However, it is what will keep the value of the asset high and continuing to appreciate. And on top of that fact, you can’t expect to get top rent or the best tenants in a run-down building. Follow this tip for landlords to keep your tenants happy.
4) Not renewing leases and yearly rental increases:
Guilty as charged!! I don’t know about you but time slips thru my fingers pretty fast these days and without a system for lease renewals I’m in sad shape. The goal is to increase rents every year, as long as they are at or below the market rent in the area. Some landlords don’t do this because they fear losing tenants. This is an emotion we can’t afford as a landlord. As long as you have a decent unit and you are at or just below market rent you should be raising the rents. I use COLA (cost of living increase) as a guideline for rental increases.
5) Not giving your tenants the best customer service:
This is another tip for landlords that will keep your tenants happy. I’ve had many people tell me they don’t want to be a landlord because they don’t want calls at odd hours or headaches – well the way I look at my tenants is that they are paying my mortgage and deserve good customer service. That means returning calls within a reasonable time and dealing with issues.
Diana D. Hill – firstname.lastname@example.org