The Most Common Challenges Faced by Inexperienced Landlords
Those who have tried their hand at renting out property know that it is a taxing and demanding thing that should not be taken lightly. For many who are just now beginning the trade, it can be very easy to fall prey to very common mistakes that inexperienced landlords often make. Notable examples of these vexing situations include the following: improper screening of tenants, too much trust, insufficient enforcement of policies, and not paying attention to the property.
1. Not Properly Screening Your Tenants
When renting out a property, very few things will lead to disaster quicker than not properly screening the tenants. There are several huge factors to consider during the screening process: credit history, references, and history as a renter. Your application form should always ask for references and past landlords, as well as enough money to do a credit check. No matter how desperate you may be for a tenant, never accept one on the spot, even if they can pay upfront.
2. Never Put Your Trust in Only a Handshake
Always, always, always have paperwork. The times of universal honorability are past, and contracts are the only thing, which ensure compliance to an agreement. No matter your first impression of the tenant, make sure that you have ample documentation of the agreement, as well as clearly stated rules that they must follow. In a worst-case scenario where court action is involved, more paperwork will give you a greater chance of ensuring that justice is done.
3. Always, Make Sure Your Tenants Follow the Rules
You will need to set up rules as a landlord to govern the relationship between you and your tenants, protect your property, and ensure compliance with the rent. Never be lax about these rules, no matter what the circumstances may be. If you have to get tough, get tough. Unethical tenants will take advantage of any mercy you may extend, and you will suffer consequences, in both finances and property value, because of it. In the aforementioned worst-case scenario, any exceptions to the rules will be weaknesses that the opposing side can exploit.
4. Not Keeping a Regular Eye on the Property
This danger bears close similarity to the previous struggle. If you do not regularly visit your property, then you may be unaware of potential threats to the integrity thereof. If your tenants leave the place in disrepair, or have incurred damages, then you may have to pay hefty repair fees or suffer a decline in property value. Likewise, checking up on the property can give you clues as to the ethical behavior, or lack thereof, of your tenants, as well as their habits and integrity.
These dangers to a working landlord are only a few of the many that await the incautious. Look on this website for more tips on how to avoid common landlord mistakes, or to discover the services of a property management company that can vastly reduce the stress of renting out to tenants that you experience.