8 Property Management Tips for New Landlords
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Originally Posted On: 8 Property Management Tips for New Landlords (osoblanco.org)
Looking for landlord tips to improve your property?
Whether you’re a new or experienced landlord in the United States, rental management is complex. You must have a specific mindset and skillset to survive. These ensure your property continues to give passive income for years to come.
Ready to become a successful landlord? Learn these property management tips to protect your investments:
1. Your Rental Property is a Business
Most landlords use rental properties as secondary income sources. However, you must consider it as a business.
Maintain professionalism with your tenants. Do some background checks before they move in.
To do good business, you must be compliant with the landlord-tenant laws. Adhere to the federal, state, and local laws since it keeps your rental business reputable. It also helps avoid legal trouble that makes you pay hefty fines.
Do your research to understand these regulations. Protect your business from accidents and liability claims. Get a landlord insurance policy to prevent you from bearing the cost of loss.
Unfortunate situations can happen at any time. If theft happens on your property, you need not worry about the tenant suing you. You won’t pay thousands of dollars since your insurance protects your business.
At the same time, prevent problems from happening in the first place. The best method is to keep your building well-maintained. Always double-check whether it’s safe to live in your rental property.
Invest in ensuring that everything is up-to-code. All utilities must work. At the same time, fix every dangerous problem before they damage your reputation.
Prepare for untoward incidents without becoming paranoid.
2. Find Your Tenants Online
Most tenants use search engines like Google to find their next apartment. Make an online rental listing to find these people effectively. Some websites like Trulia are perfect for this purpose.
The most important thing about listings is to give potential tenants as much information as possible. Most tenants prefer knowing the following information:
- Rent price
- Number of bedrooms/bathrooms
- Nearby attractions
The more informative your listing is, the better chances you’ll get a tenant. Upload some clear pictures of each room and common area. Tenants feel more invested with your space if they can visualize it better.
Your rental listing must highlight your best features. List your requirements since it will attract qualified tenants more. These people are reputable enough to pay on time while taking utmost care of your property.
3. Consider Getting a Property Manager
Property managers are worthy investments. They help you save the time and effort involved in owning rental properties. They have enough training to market your rental, collect payments, and deal with various issues arising from tenants.
Good property managers can take care of multiple rentals. It’s a good way of relieving yourself from the hectic responsibilities. It prevents you from getting overwhelmed.
It’s also a viable option if your home is far from your property. With a property manager, you need not commit. It means you won’t have a full hands-on approach to property management.
It will give you some peace of mind.
As a landlord, it’s your legal responsibility to maintain your residents’ habitable areas. If you have insufficient time or resources for this task, don’t be stubborn. It’s time you consider getting professional help.
The extra expense is worth your money. A manager streamlines your landlord duties while making your rental process hassle-free. However, you must be careful in selecting your property manager.
Ask for references and interview various candidates. Mull over what they can bring to your business. Pick your final candidate based on their merits and abilities.
4. Charge the Right Rent Price
To know the right price for your rent, look into the average price range based on your location. Make your prices sensible. It will spell the difference between attracting great tenants and vacancies.
Lots of online applications are available as rental guides. While setting your rent price, keep in mind its effects on your financial situation. Payments are your primary income source on your rental property.
Compare your property income and your rental expenses. List both fixed and estimated costs. The former includes property taxes and the latter property improvements.
When you compare these factors, it’s easier to project your monthly profits. It allows you to determine whether the rent price is worth keeping the property. However, it’s useless to set the right price when tenants won’t pay on time.
Once settled, consider rental property security. Check out how Patrol Points can help with your rental business.
5. Make and Follow a Tenant Screening Process
The goal of this process is to discover quality tenants. They’re people who can pay rent on time. They have the right attitude to care for your property like it’s theirs.
Filter out the good tenant applications from your mountain of requests. Check their rental background, criminal history, and finances. Select ones without past criminal records and with a stable source of income.
6. Require Renters’ Insurance
Living in a lawsuit-laden land means arming yourself with knowledge. Encourage your tenants to do the same.
Make them take renters’ insurance. It allows you to avoid litigation in case their belongings get damaged.
Your tenants have no excuse not to take renters’ insurance. It’s usually cheap, making it a minuscule financial burden for most tenants. It’s easy for them to become willing to avail of this policy.
However, consult legal professionals first. Do it before you add a clause to your rental agreement about the renters’ insurance requirement. Depending on your state, the laws may differ.
7. Require Rental Applications
The rental application process is beneficial for the insight it gives. You’ll gain information about your tenant. These will include:
- Current residence
- Moving reasons
- Employer data
- Landlord references
Before letting anyone live on your property, think about your questions. Asking the right inquiries will allow you to get enough information about your potential tenant. With this, you’ll be certain whether this applicant is suitable for your property.
What Discrimination Types are Illegal?
Fair housing laws give specific illegal reasons to refuse rent to tenants. You can’t reject applicants because of their race, religion, ethnicity, and gender. You also can’t deny the applicant based on whether they have children or disabilities.
Some state and local laws also forbid discrimination against marital status, age, or sexual preferences. You’re free to choose among your tenants as long as you don’t violate these laws. You must also base your decisions on valid criteria.
What Subtle Actions are Illegal Discrimination?
The law prohibits you from advertising your rental preferences based on group characteristics. For example, you can’t make a listing asking for a group of specific skin color to rent your property. It’s also discriminatory if your late payment policies are inconsistent.
8. Do a Credit and Background Check
Looking for a tenant with financial accountability? Use credit checks to learn whether they qualify. Always look for red flags when reviewing their credit and background reports.
Look for another tenant if you find out they have a history of undue payments and notable debts. Even more so if they filed for bankruptcy before. Check their eviction history and determine the cause.
Your tenant must have a solid financial and background history. It predicts whether they’ll pay on time and treat your property with the respect it deserves.
It’s always better to find a tenant with a good credit standing. Bad credit is often an indicator of financial recklessness. Even when they’re perfect in other ways, the numbers won’t lie.
You can get a prospective tenant’s credit report. However, you must send an “adverse action” letter to a rejected tenant because of this reason. It must inform them about the rejection, the reporting agency, and their right to get a free copy of the report.
Run a credit check using the applicant’s name, address, SSN, and ITIN. Order the report from a credit-reporting agency. They’ll get the information from the three primary national credit bureaus.
Honorable Mention: Make a Written Rental Agreement
Doing this helps let tenants know about your expectations. It protects you from some legal repercussions.
Oral agreements are only legal in some situations. Regardless, they’re less effective than signed written documents.
Without these documents, it’s hard to prove your agreement with the tenant before they moved in. All the rules and clauses must agree to state laws. It must be specific since vague wording can make things messy in the court.
HOA regulations aren’t suggestions. Ensure that the rental agreement specifies them. It includes quiet hours, guest parking rules, and more.
Having a clear rental application strengthens your relationship with your tenants.
Learn More Property Management Tips Today!
These are some of the things that smoothen your landlord operations. These property management tips can go a long way for your business. It ensures the law protects your rental from disrespectful tenants and unexpected damages.
Need more tips for landlords? Read our other guides for managing a rental property to hone your skills more.