These days, being a landlord can turn out to be a really profitable enterprise, but it is one that also comes with a good amount of stress! Although property management is not a rocket science, the truth is it takes experience and knowledge to become a successful landlord. Owning buy, to let property and managing tenants can be a tricky aspect for most people. There is so much that could happen and (probably does) go wrong. Soon, small mistakes could turn out to become serious and bigger consequences.
Before you decide to put up your home for sale or rental listing on Fish Need Water, you should think about the series of responsibilities that come along with being a landlord. Learning through trial and error is not the right ways to go about in the estate market. Before you decide to take the plunge, here are some common mistakes you need to avoid.
Not Living Near Your Property
Living far away from your property is a mistake you need to avoid as a landlord. Living near to your property will give you the advantage to check it out every now and then. When the need arises, you can take care of all the repairs yourself, and show the property to other renters when it is time to list it in the rental category again. It is advisable that you research all the best areas, but even if you do not live in a prime rental region, you can still invest in one by hiring an estate agent, or a property manager to take off all your day-to-day details.
Not Understanding the Local Market
Location remains to be the most important word in the real estate market. Before you decide to give your home on rent, as a landlord, you need to understand and make sure that your rental is set in a desirable location to attract more tenants. Keep the local market in mind and set up a realistic rental amount. Get to know the neighbourhood, and the amount others have for their tenants. This can help you to predict your monthly income.
Not Knowing about the Landlord-Tenant Law
Every city has its own specific landlord-tenant provisions that cover many areas including the level of access tenants have to the property (number of years or days they can stay), a security deposit (if any required), and how much you want them to pay. Usually, the law wants landlords to follow a precise plan on how they need to treat their tenants. As a landlord, you need to follow the landlord-tenant law that states landlords should avoid any sort of discrimination, whether it is racist or sexist.
Not Sticking to the Rent Date
This seems like something that is out of the question, but yes, this is a common mistake. Most times, if you get too friendly with your tenants, a time may come when you just allow them to slide out a couple of weeks beyond the actual pay date. Sometimes, you may consider taking a partial payment but before you know it, you will be six months behind and it will become difficult to catch up on all the days or months missed. The best solution here is to remain firm, but firm does not mean you should be rude or treat your tenants with disrespect. When you cultivate a good relationship with your tenants, this often goes a long way to ensuring that your rent will be given to you on time and that repair requests will be a lot easier to deal with when the time comes.
Not Screening Tenants
As anxious and excited as you may be to get a tenant and the rent coming in, it is not worth rushing the process and skipping some checking first. You can use a rental application form that would help provide you with adequate information, the money necessary to obtain, and some details about their credit background. Check their background, their renting history, whether they pay on time, and follow rental laws. Do not allow yourself to feel rushed or pressured into making a costly mistake.
Not Customizing the Lease
If you do not work with an estate agent, or have one, both ways, you need to use a standard lease agreement to state what rights you give the tenant. For example, it should state details like when you would expect your rent, whether they can keep pets, and specify how many, or the rules that you wish to apply.
Not Treating Your Rental like a Business
No matter how you got yourself in the rental business, you have to treat it like a business. Treat your monthly rent as an income. Keep a track on all the income you receive, the amount you spend on maintenance and document all your communications to be sure that you work according to the agreement you make with the tenant.
The real estate business is a great one. However, anytime you get started with something and have no experience, mistakes are bound to come your way. The key to success is to learn from those mistakes and keep going! You can always turn to experienced estate agents such as the ones at Fish Need Water, who can guide you on everything there is to know in London estate market.
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