Many people dream of becoming a landlord. Putting a property up for rent can be a highly profitable venture for property investors. However, being a landlord can be challenging.
With all the responsibilities and tasks involved in renting a house, it’s easy for investors to get incredibly frustrated and make mistakes. However, learning some general tenets will make your journey as a first-time landlord much easier.
Are you wondering what to expect as you start out as a landlord? Below are certain things all first-time landlords need to know:
Seeking Tenants Requires more than Simply Listing the Rented Property
Finding good tenants to rent your property will make your job as a first-time landlord easier. Marketing the property is the first step to finding tenants. You will advertise on local newsletters, on your website, online ads, on social media platforms, and in local magazines or newspapers.
However, this is not the end of the process. After attracting a few potential tenants, you need to verify how suitable they are. Screening potential renters would involve the following:
- Income verification
- Credit check
- Background check
Also, you must not forget to ask the tenants for previous landlords’ references. That will help you identify tenants with problems early enough.
Finally, when advertising your rentals or screening tenants, be sure to adhere to the housing laws. For example, discrimination against a prospective renter based on family size, gender, ethnic background, disabilities, race, colour and religion is illegal.
Your Rental Yield Matters
Your rental yield is the amount of money that you stand to make from renting out a property that you own. So, when you are preparing a property for rent, it is vital that you calculate your rental yield. Rental yield is so important because by having a solid understanding of it will enable you to make better investment decisions and ensure that you have an affordable buy-to-let mortgage.
It’s very important for every first-time landlord to keep clean records of every transaction. By writing off some or all of your maintenance and mortgage interest fees, insurance costs, and listing fees, you’ll be able to enjoy tax benefits – but you have to keep good records.
It’s also wise to take pictures of your rental property before the tenants move in. Once the tenants decide to move out, you can then use these pictures to determine damages.
You can Hire a Property Manager
First-time landlords often make the mistake of attempting to get everything done on their own. You must think about hiring a property manager if you don’t have the skills or resources to manage your own rental property. This can be of particular help to real estate investors owning multiple homes or apartments.
The property manager will run the ads, prepare the rental agreement, screen the tenants, and handle evictions and maintenance issues. It would be worthwhile in the long run, even though hiring a property manager may cut your earnings.
Being a landlord is a big responsibility. However, it is also extremely rewarding. As long as you take this advice on board and do your research, you will be well on your way to becoming a successful landlord in no time.