How to become a successful Landlord: 25 Tips from Pro Landlords
Becoming a successful landlord requires a special skill set and a burning desire to earn fortune. Anyone can become a landlord. But what separates successful landlords from the bunch is their mindset. They have the ability to make decisions and act on them in time is what makes them successful as landlord. You can also become a successful landlord if you are willing to learn these pro tips and implement them in time.
A successful landlord possess special characteristics and they don`t fall for the pitfalls what other landlord usually falls into. They thrive for managing their rental business and its assets to its best. They know how to keep their rental property harm free and how to create fortunes from it. They understand that their tenants are their biggest assets and they then treat them like one.
25 Tips Successful Landlord wants you to learn
A successful landlord doesn`t do anything new from what you do. They only do things in a different way. Learning these tips is sure to give you a new horizon on running a landlord business. You will definitely improve and increase your profits if you implemented these tips in the right way. You should then bear in mind these 25 pro tips to graduate and become a successful landlord.
Tip#25: Becoming a Landlord is a Business
A successful landlord knows the importance of treating the rental property as a business. In order to manage the rental property and having cash flow every month, you have to follow a systematic approach. Your tenants are your valuable customers and you need provide a good after sales service to them. Having it run like a business will keep you organised and you can keep churning good returns from your business.
Tip#24: Screen your Tenants Properly
Having a good tenant at your property is a blessing come true. It is easy for you to skip the tenant screening process as you are eager to rent out fast. But a successful landlord knows importance of screening and does that every time before renting them their property to tenants. Having a good tenant can save you from a lot of troublesome situations. A bad tenant can cause harm to property, huge eviction costs, and issues with neighbor tenants especially in multiple family homes.
Tip#23: Documenting Everything
A lot of landlords easily skip the step of documenting everything on their rental property. But the successful landlords have a habit of documenting everything from the moving in condition, maintenance requests, and a lot of other important information. Doing so can save you from losing money on maintenance costs. And it becomes easy for you to keep your property free from damages. You can also levy maintenance charges easily if your tenant ever harms the property.
Tip#22: Make Proper Lease Agreement
A proper rental lease agreement clearly mentions both the tenant and the landlord responsibilities. It is an important document that keeps your tenancy free from all kind of harms. It sets exact guidelines for you and for your tenant to act in a certain way during the rent period. And, if ever any dispute arises during negative times, you can get an upper hand as a landlord. A successful landlord sets a well documented lease agreement that clearly contains rent guidelines for the tenant.
Tip#21: Review the Lease Agreement with a Lawyer
You are not a law person which can make you miss out on important points in the rent agreement. Successful Landlords always consult a lawyer for reviewing their rent agreement. It is always better to spend some bucks on consulting a lawyer today rather than regretting it tomorrow. Off course, it is not good to lose money because of a small negligence. At least this is not what successful landlords suggest you to do. So, always have a lawyer to review the lease agreement for you.
Tip#20: Document moving in Condition
The successful landlords document everything. They even document the condition of the property before renting it to the tenant. The best way to do it is to take photographs of the property before your tenant moves into it. Send these photographs over email to your tenant and ask him/ her to verify the same. This makes your tenant serious about maintaining the property. Having records, you can also charge them easily in case of any harm to the property due to their negligence.
Tip#19: Give Move out Package
The move out package let your tenants know how they will get the security refund when they vacate the property. This package clearly indicates the charges incurred when they move out of the property. Give them this package immediately when they rent your property. You should clearly mention the charges incurred if they didn`t handover the property in the condition you have earlier rented in. You can charge them for not cleaning or doing any harm to your property.
Tip#18: Collecting Rent Payments
The successful landlords clearly mention the modes of payment for collecting rent payments. It is always better to collect the rent through bank transfers or through online transfers only. Don`t commit the mistake of collecting the rent in cash or by checks. Getting cash payments are difficult to record and are hard to track. Similarly, having a check payment also has a high probability of getting rejected. It sometimes leads to ruined situations between you and your tenants. Always, keep your business safe and secure.
Tip#17: Set up a late rent policy
Setting up a late rent policy is important. The successful landlords do it and save themselves from a lot of the future hassles. Setting up late rent policy mandates your tenant to pay rent on time. You can save yourself from remembering the dates and the tenants who haven’t yet paid the rent. You should clearly mention due date of rent in the agreement lease and specify the late rent fees. This way you can better handle tenants who have a habit of paying late rent payments.
Tip#16: Scheduled Inspection
Regular Inspection of your property is mandatory to keep it free from any kind of harms. A successful landlord always inspects his/her property on regular intervals. It is advised you do it every month. Inspect your property for any kind of damage and inspect the assets that may require some maintenance. It is always better to fix something early rather than fixing it when it becomes permanently damaged. This will save you from losing your fortune in huge maintenance costs.
Tip#15: Respect Privacy of Tenant
A happy customer is the best asset of any business, so do are your tenants. Never ever interfere with the privacy of your tenants. It can cause you to lose your business. You want to inspect the property, it is better you give them a written notice one day prior before doing that. The successful landlords even put this clause in the lease agreement to avoid any future conflicts. It is the right of your tenant to feel safe and secure in the property without getting their privacy hindered.
Tip#14: Handle Complaints
To become a successful landlord, you should know how to handle the complaints of your tenants. Think about getting a call every time your tenant got a problem. What if they call you at midnight to report a problem that is not even an emergency? Successful Landlord doesn`t operate that way. You should always get your tenant furnish their complaint in writing that too with complete details. It will save your time and help you take necessary actions.
Tip#13: Set your hours
Setting your work hours is important at least this is what every successful landlord knows. It is really important to have a work life balance. And, you are also doing a business here. So, it becomes important for you to set your work hours and convey the same to your tenants. You should clearly mention the time you can be contacted for any kind of query. You can also set up a Google Voice Number or take alternative phone to protect yourself from getting calls on your personal number.
Tip#12: Evict Tenants if necessary
A successful landlord wastes no time in evicting a tenant who violates the terms of agreement. You need not to bear a tenant who is not paying the rent, or damaging your property. Eviction also becomes important if your tenant is messing around with the neighbor tenants especially in multifamily homes. Such tenants pose a real threat to your rental business. The process of eviction becomes smooth if you have proper proofs for non payment, damage and written complaints by neighboring tenants.
Tip#11: Set up Guest Policy
It is important you set up a guest policy for your tenants to keep your property harm free. Better to include it in rent agreement itself rather than regretting it afterwards. Having a long term guest can be a pain if you don’t have a guest policy like all successful landlords does. A long term guest is someone who resides at your property for more than two weeks. A successful landlord understands the trouble in evicting a guest if ever they harm your property or violate the rules. Always take written requests for long term guests and have proper details on their stay.
Tip#10: Know the landlord rights
To become a successful landlord, you need to know all your rights very well. If you know the landlord rights, you can quickly react in negative situations. Getting to know the landlord rights doesn’t mean you have to become a lawyer yourself. Instead you should be aware of the basic rights and how to exercise them if negative situations occur.
Tip#9: Don`t become a Plumber or electrician yourself
You are running a rental business here and not operating as a service provider person. A successful landlord doesn`t handle plumbing, electricity or any other kinds of service related work by himself. You are not qualified as a service person. Chances are you waste a lot more time and even end up messing it more than when you hire the right guy. Also, even if you know how to fix something doesn`t mean you fix it your own as a landlord.
Tip#8: Hire a Management Company
It is always a better idea to hire a management company to take care of the operations of your rental property. The successful landlords having multifamily homes always prefer hiring a management company. The management company has both experienced and professional people to take care of your property. They operate in much better way and can save you from a lot of landlord troubles. You can also save a lot of your time and money with them.
Tip#7: Have a Right Insurance
A successful landlord knows the importance of having right insurance for their rental property. You don`t want to lose your money due to events that can harm your property. Having a right insurance to protect your rental property and your business is mandatory. Buy an insurance which covers defects from events like natural calamities, fire, short circuit, burglary, and terrorism. You should also consider insuring your tenants and loss of your revenue due a unfortunate event on your rental property.
Tip#6: Happy Tenants increase your profits
A successful landlord exactly knows the importance of having happy tenants. They know the cost of finding a new tenant compared to retain the existing one. The tenants are your customers and having happy customers is the biggest asset of your business. Keeping your tenants happy will help you build a long association with them that can benefit you in thousand ways. You can expect timely rent payments; they will take care of your property and can help you build your reputation.
Tip#5: Appreciate and reward your tenants
It is important you appreciate and reward your tenant if they are helping you grow your business. Always appreciate your tenants on timely rent payments. You can offer help to your tenants to settle down in your property. They might be new there and doesn`t know much about the place. You can offer some discounts or a movie ticket occasionally to your good tenants. Consider giving them a deep clean or a white wash if they are staying from long time at your property. It will make them feel welcomed on the property.
Tip#4: Raising the rent without losing tenant
The successful landlords know the art of raising the rent without bothering their tenants. It is your right to increment the rent every year by 5%- 10%. It doesn`t bother much to tenants if you are having a maintained place and a good landlord tenant relationship. But it can do wonders for you if you increase the rent and add some extra value to your customers. You can quickly replace the carpet or some other items that you are thinking of replacing it after few months.
Tip#3: Manage your finances
There is no point of running a business if you are not able to manage your finances. The successful landlords put a close attention on managing their finances to keep earning the profits. You are getting cash flow every month but if you are not managing it well. Then, you are not using full potential of your business. You need to manage the cash flow by keeping the amount aside for future maintenance, taxes and insurance fees. Also, keep some cash flow aside to invest in owning new assets.
Tip#2: Know the Tax Laws
The rules of paying taxes on your rental property can be quite cumbersome. A successful landlord always hires a tax consultant to do this job. However, you should also have the basic information of tax laws to have necessary deductibles from your rental income. You should always document your costs and expenses to get the right deduction from your rental income. There is no better business other than rental income where you can enjoy a lot of deductions from your income.
Tip#1: Invest in improving yourself
The first and foremost tip to become successful in your landlord business is to invest in improving yourself every day. There is no better investment than learning something new to improve yourself. You can learn to improve your business operations. You can learn about software that can ease your work as a landlord. Taking new courses and learning investments should definitely be the next thing on your mind if you want to be a successful landlord.