There’s a lot more to running properties than just collecting the rent every month. Landlords have to deal with many challenges, including property taxes, tenant complaints, and what often seems like endless repair expenses. Investing in a rental property comes with a lot of unexpected challenges and responsibilities. These challenges can easily lead a well-meaning property owner down the slippery slope towards becoming a monstrous landlord.
However, creating solid connections and building lasting tenant/landlord relationships come with a lot of benefits. Your renter is more likely to take better care of your unit, resulting in reduced maintenance costs. Things like property inspections, fixing repairs, and showing the property to prospective tenants at the end of the rental agreement also become smoother. Your tenants may renew their contract several times, even with slight rent increases. In this article, we’ve outlined a few tips and tricks you can utilize to be a great landlord.
Get Good Tenants
To become and remain a great landlord, you need to get quality tenants. While an element of luck comes into play, getting good tenants comes down to how well you screen prospective occupants. Rather than just going with the first interested party, it’s a good idea to take extra time to conduct your due diligence, as that increases your chances of getting affable tenants.
The first step when looking for new tenants is to take each potential renter through the same screening process. The primary goal of your screening process should be to establish if the potential tenants are likely to pay their rent on time and take care of your property as if it was their own.
Start by creating and getting prospective tenants to fill out an application form. Key pieces of information to ask for include their name, current address, employer information, income, criminal history, reason for moving, and previous landlord contacts. Following up on any listed references will provide the most accurate picture of your to-be tenant’s rental background.
Encourage Renters Insurance
No property owner wants to imagine a catastrophic incident occurring to their rental unit. However, most of them diligently pay insurance premiums to cover their losses if such incidents happened. What you may forget to do is encourage your tenants to do the same. Almost everyone is familiar with auto insurance, but very few tenants know that they can also insure their possessions. Renters insurance premiums are generally low-cost, so it won’t cost much to maintain an excellent landlord/tenant relationship. It’s easy to shop around for tenant insurance quotes to get an idea of what it would cost, and what kinds of coverage are provided.
Customize Your Rental Agreement
You can download a standard rental agreement form online. Most basic rental agreements cover the cost of rent, security deposits, what happens in case of nonpayment, and other legal issues. Instead of simply adding your names and signatures, use the documents as an opportunity to discuss and agree on any concerns you may have. Include as much detail as you can on things like pets, renovations, maintenance responsibility, and more.
Besides a roof over their head, tenants also want their privacy. While you have the right to inspect your property, you don’t have to show up at odd hours. Include in your contract the number of times you want to inspect your rental unit per year and what time of the day you will do so. The more detail you can add, the less friction you’re likely to have in the future.
Attend to Issues Early
In real estate, attending to issues early saves you from strained relations and expensive resolutions. Part of being a great landlord is the ability to see potential problems before or soon after they’ve happened. For example, a leaking roof may point out the need to replace the entire thing a few years down the line. Great landlords are also willing to put aside a bit of money for preventative maintenance to avoid bigger issues. This point is not limited to your property. Tenants that constantly pay their rentals a few days late might eventually start defaulting. As soon as you notice any slight problem, try to get to its root. The earlier you notice problems, the smaller the required solution becomes.
Open Multiple Lines of Communication
To attend to issues early, you have to know about them as soon as they arise. And who better to notify you than your tenant? But for them to do that, they need to get a hold of you easily. It’s best to provide them with multiple contacts to get an issue resolved. For example, if you own multiple properties, you may have a good electrician that you usually call for repairs. Instead of coordinating minor repairs yourself, you can provide your tenants with the electrician’s contact and ask them only to notify you whenever they have repairs done. Also, remember to return any calls that you miss from your tenants.
If you own property that you lease out, you most definitely want to keep a positive working relationship with your tenants. By creating a rigorous screening process, customizing your rental contract, encouraging tenant insurance, and other simple steps, you can become an attentive, proactive, and considerate landlord. But do keep in mind that nobody is perfect. Both you and your tenants may occasionally fall short of the exemplary mark. What’s important is to focus on continuous improvement.