You cannot own and rent out a property without first possessing the characteristics of a smart landlord. A business venture such as that are a big risk and a challenge to manage. You will have to deal with many people, go through countless official documents and forms and have keen, scrutinizing eye. Getting into this unprepared will surely spell doom for your endeavor. You could make a lot of money but also lose all of it if you are not careful. Here is how to be a smart landlord:
- Make sure you have insurance. If you do not have insurance, get one now. Review the details of your insurance plan. See to it that you are fully aware and understand all the details of your plan. Make sure that you have enough coverage to deal with any possibility. Before you have a new tenant come in, make sure you have comprehensive pictures of the property as evidence of their condition before the move. Of course, you need to make sure that there is nothing wrong with the property before you do this and fix things that need fixing. When the tenant moves in, make sure you have a written recommendation for them to get renter’s insurance. Prepare for them the details of what is covered by your insurance.
- Securing the lease. You can pickup generic lease documents in most office supply stores but it is highly recommended that you not use these. It is always best to secure a lease form from the state. If not, it’s on you to produce a more specific lease and to make sure that it will stand up in court.
- Thoroughly screening prospective tenants. Your tenants will be the death of you, so make sure you vet them completely. Allowing the wrong people to rent from you will not end well for you. In this day and age, it is very easy to fake lives and evidence. Make sure that you have your own surefire way of screening prospective tenants. Ask them for recent references, probably as recent as six months ago to ensure that they are capable financially of renting from you. All your problems will come from your tenants so make sure that you can separate the good ones from the bad.
- Ask for a security deposit. As a down payment, ask for one month’s rent upfront. Make sure you get the money before they move in or on the day itself just in case they turn out to be delinquent renters or do not honor the contract. If they pay you in check, make sure it clears first.
- The property itself. Of course, before you start leasing out your property, make sure that it is compliant with all state and safety codes. A good lawyer can sniff out any violations you may have made. Come up with a pricing strategy that makes you competitive.
A smart landlord is resourceful, practical and thorough. You will need all these things of you want to successfully manage your properties. Follow the tips above and you should be alright.