First Time Landlord? Consider These Hard-Learned Lessons

Contrary to popular perception, fulfilling the role of a landlord isn’t the easiest job. Not only may you have more than one property to manage, but a rotating set of tenants that come and go over the years, all with unique needs. This is especially true if you work within a niche, such as offering short-term lets to students in a relatively busy university city.

If you’re a first-time landlord, it’s always wise to follow the guidance of those who have come before you, limiting the sting of a bad tenant or an unwise investment. But it’s not just about who you have in your properties that counts, but the management measures you use to keep them happy and ensure your property is well kept over the years.

If you manage your properties correctly, life as a landlord can be a pleasant one, even if it involves more work than most people would assume. Moreover, you can build nurturing and mutually supportive relationships with trusted clients over the years, which can prove to be a positive and rewarding experience for both parties. If you do it right, some tenants may be happy to stay for years.

Let’s consider more of those hard-won lessons, below:

Thorough Tenant Vetting Process

You get to decide how you vet your tenants. The letting agency you utilize may have its own process, and of course, that’s part of what you pay them for. But depending on how you let out your properties, you have a right to meet them in person and even ask them for referrals or a credit check where appropriate.

This way, you can limit the chance that someone will be unable to afford your apartment or won’t keep up with the payments. That being said, a credit check isn’t necessarily the only method by which to ascertain if someone will look after your property and be respectful of their payments. Meeting them in person, conducting viewings yourself, and asking for proof of employment or study status can be enough for all parties involved.

Legal Understanding & Compliance

It’s essential to understand the developing compliance measures and housing laws that apply to your status as a landlord, no matter if you’re renting a room or an entire property to your tenants. For example, if you split up a house into multiple apartments, you may have to pay local housing authority or council tax compared to the standard rate that tenants would expect to pay otherwise.

Moreover, the laws surrounding tenant rights often change. For example, the renter’s reform bill in the United Kingdom is going to create a landlord registry, scrap no-fault evictions, and make it illegal to reject people who have children solely on that basis. It’s important to be clear-eyed about this and develop a coherent business plan to help adopt and adhere to new standards when they come. Often, appropriate rental services you go through will help you ascertain and fulfill those necessities, but it’s always best to be certain.

Emergency Fund for Property Repairs

It’s quite amazing how often properties can break down and how many little maintenance tasks can be found year on year. When it rains, it pours, so they say. That’s why it’s smart to put healthy maintenance protocols in place now. They will give you the breathing room you’ll need to prosper later on down the line.

For example, hiring contractors that use appropriate plumbing software to manage your tasks and keeping them on contract for a long period can ensure you have a private maintenance outfit to come attend to emergency issues ahead of time. This might include a lack of hot water over the winter break, for example.

Electrics, locksmithing, and gas safety emergency contacts must also be provided. This way, you not only attend to issues quickly, but you make certain you always keep up your side of the contract going forward.

Clear and Detailed Lease Agreements & Deposit Schemes

It’s important to be comprehensive and clear about your lease agreement. They must be drafted and read over by legal professionals. You must also ensure each lease agreement is similar in scope from tenant to tenant, especially within the same property. Some unique clauses may be essential, such as asking a tenant to keep the property’s garden in good condition if they have one.

Depending on the country you live in, protecting the security deposit of your tenant is also essential. This deposit can be utilized only when a valid claim has been processed due to damage to the property, or sometimes to settle rental arrears after pursuing the possible target.

A clear and detailed lease agreement sometimes cosigned with a guarantor, sets out the contract for both parties and makes certain quiet and peaceful enjoyment of the property is accepted. You may also stipulate certain measures in line with the housing law of your country – for example, in some countries a tenant changing the locks is more than feasible, at other times it isn’t.

Regular Property Inspections

Depending on the type of property you let out, an annual inspection will be necessary. This is commonly held so that the landlord can check on the property, and that certain safety measures like a gas safety and fire alarm check can be conducted to keep the property in good condition.

In some cases, like when processing viewings for the upcoming annual contract, you may need to notify of viewings in advance. You can do this by offering at least 24 hours of notice before you come to visit. If the timing isn’t appropriate, you can agree upon a new date where appropriate. This kind of mutual respect is important when looking after a property, and so it’s important to try and build that trust with your tenant, never leaning on their rights, and making it clear when such protocols have to be implemented.

Understanding Market Rental Rates

Of course, you’re more than entitled to ask the market rate for the kind of property you provide. You’re not letting your properties for charity, after all. That being said, it’s important to be mindful of how you measure that rental requirement. Raising the rent can be important from time to time, but you may be limited in how often you can do that, not only due to good sense.

In some countries, you can ask for raised rents within a certain amount of time, such as a year or two. In others, you can raise the rent from contract to contract before you bring in a new tenant. Of course, it’s also important to calculate certain essentials, like if bills will be inclusive, if that includes internet, what other taxes might be included, or if tenants are expected to organize utilities as expected from that point on too.

Planning For Bad Tenants

Unfortunately, sometimes you may happen upon a bad tenant. Luckily, you don’t have to just take their treatment, you can plan your method. For example, if rent is in arrears consistently, then asking them to settle that and keeping records of your communication and a lack of reimbursement is key.

You can also visit after noise disputes or neighborhood complaints to inspect the property and make sure everything is in good standing. If you find paraphernalia for controlled substances, property damage, pets that haven’t been granted permission, and even other tenants that haven’t agreed to spend time in the property, all of this can constitute grounds for eviction where appropriate. Egregious lack of care in the property, such as letting damp fester without opening windows or contacting your maintenance team, can also count.

Understanding eviction law is key. In many cases, you will need court approval to evict the tenant and give them time to leave the property. When that date comes, you are only then legally allowed to change the locks. There are other remedial processes in place, such as small claims court where appropriate. This way, you can try to reclaim your property and the lost revenue you should have generated despite a breach of contract.

Documentation & Record-Keeping

Your letting agent will keep steadfast records, but it’s important to keep your own, too. From problems with tenants to property maintenance and renovation plans, from rejuvenating apartments to new housing authority standards (such as having adequate fire escapes in place or energy efficiency quotients), all of this should be scheduled in advance

Life as a landlord can be fraught when you’re spinning plates throughout the day just plugging holes instead of integrating work into your schedule and keeping a close eye on your properties and who lives in them. Moreover, being a friendly face can help you develop long-term relationships with your clients that are to be trusted, and that will no doubt benefit you as a result.

With this advice, you’re certain to avoid learning lessons the hard way, and will instead provide happy living spaces for your range of tenants over the years. This can be a fruitful and rewarding experience if you know how to plan, and so we wish you the best of luck in your efforts.

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