Owning rental property comes with a unique set of challenges. From finding the right tenants to dealing with repairs and maintenance, there’s a lot to keep track of. And if you’re not careful, one small mistake can end up costing you big time.
To help you avoid costly mistakes, we’ve compiled a list of the 10 most common landlord errors and what you can do to avoid them. So whether you’re new to the landlord game or a seasoned pro, read on to learn more.
- Failing to Screen Tenants Properly
As a landlord, you have a lot of responsibility. Not only do you have to maintain the property and keep it in good condition, but you also have to screen tenants carefully to make sure they will pay rent on time and take good care of the property. This means doing a background check, credit check, and verification of employment and/or income. Some landlords also like to require references from previous landlords. However, screening tenants carefully is just one part of being a good landlord. By providing quality property management services, you can help ensure that your tenants are happy and that your property remains in good condition.
While it may be tempting to skip this step in order to rent out your property more quickly, it’s not worth the risk. By taking the time to properly screen your tenants, you can avoid problems down the road. Plus, using a service like Renter’s Choice can make the screening process quick and easy. Renter’s Choice can help you find qualified tenants who are likely to pay rent on time and take good care of your property. So why take the risk of skipping this important step? Screen your tenants today with Renter’s Choice.
- Not Having Renters Insurance
As a landlord, you are responsible for making sure your property is well-maintained and up to code. This includes making sure your tenants have the appropriate insurance in case of any accidents or damages. Requiring your tenants to have renters insurance is not only a smart way to protect yourself, but it’s also a great way to show that you’re a responsible property manager. In the event of any damages, your tenants will be able to file a claim with their insurance company and have their belongings repaired or replaced. This will free up your time and resources so that you can focus on other aspects of property management. And in the unlikely event that your tenant does sue you, their insurance policy will likely cover any legal fees. So requiring renters insurance is really a win-win for both you and your tenants.
- Not Keeping Up With Maintenance
As any landlord knows, owning rental property comes with a lot of responsibilities—and a lot of potential expenses. From paying the mortgage to dealing with tenant issues, there’s always something that needs to be taken care of. One costly mistake that landlords often make is neglecting routine maintenance and repairs. Things like leaky faucets and clogged drains may seem like minor issues, but they can quickly turn into major (and expensive) problems if left unaddressed. By staying on top of routine maintenance, you can avoid larger issues down the road—and save yourself a lot of money in the process. Of course, maintaining a rental property can be a full-time job in itself. If you don’t have the time or the resources to handle everything on your own, you may want to consider hiring a property management company to take care of things for you. Hiring professional property management services can help you save time, money, and headaches in the long run.
- Ignoring Lease Violations
Lease violations should never be ignored—no matter how small they may seem. If you allow tenants to get away with breaking the rules, they’ll start to think they can get away with anything—which can quickly lead to leasing nightmares. In order to avoid this type of problem, be sure to address all lease violations immediately and follow through with any disciplinary action that may be necessary. Of course, violating the lease isn’t always intentional. Sometimes tenants simply forget to pay rent or fail to follow other rules inadvertently. In these cases, a friendly reminder from property management may be all that’s needed to get the tenant back on track. However, if a tenant repeatedly violates the lease or refuses to take responsibility for their actions, further disciplinary action may be necessary, up to and including eviction. By taking a firm stance on lease violations, you can help ensure that your property remains well-managed and profitable.
- Failing to Collect Late Fees
Late fees are designed to incentivize tenants to pay their rent on time—but only if you actually collect them! Unfortunately, many landlords are reluctant to charge late fees for fear of offending their tenants or losing their business altogether. However, failing to collect late fees can end up costing you a lot of money in lost rent over time—so don’t be afraid to enforce them when necessary. The key is to do it in a way that doesn’t alienate your tenants. For example, you could send a reminder email a few days before rent is due, and include information about the late fee if it’s not paid on time. Or, you could post a sign in a common area reminding tenants of the late fee policy. As long as you’re clear and professional about it, collecting late fees doesn’t have to be a headache.
- Not Doing Regular Inspections
As a property owner, you know that it’s important to do regular inspections of your rental units. Preferably, these inspections should be done once per year, but at minimum, they should be done every two years. The reason for this is simple: by catching potential problems early on, you can save yourself a lot of money in repairs and other related costs. Not to mention, it’ll make your tenants happy too—after all, who wants to pay rent for a property that isn’t well-maintained? With that said, be sure to choose a reputable property management company that will help you keep your rentals in tip-top shape. Not only will they do regular inspections for you, but they’ll also handle all the repairs and maintenance that need to be done. This way, you can sit back and relax, knowing that your property is in good hands.
- Not Knowing Your Local Laws
Every state and municipality has its own set of landlord-tenant laws, so it’s important to stay up-to-date on the regulations that apply to you. Failing to comply with local laws can cost you time and money in fines or even legal fees if you end up in court. So make sure to brush up on the laws that apply to your rental property before signing any leases. For example, did you know that in some states, landlords are required to provide a written notice before raising the rent on a property? Or that in other states, tenants have the right to withhold rent if the landlord fails to make necessary repairs? Knowing the ins and outs of your local laws can save you a lot of headaches down the road.
- Not Keeping Detailed Records
As a landlord, it’s important to keep detailed records of all transactions and interactions with your tenants. This includes everything from rental applications and lease agreements to repair requests and security deposit returns. Keeping detailed records will help you stay organized and can also be invaluable if a legal dispute arises. For example, if a tenant fails to pay rent or damages your property, having detailed records can be helpful in pursuing legal action. Similarly, if you receive a complaint from a tenant, having records of your previous interactions can help to resolve the issue quickly and efficiently. In short, good record keeping is an essential part of being a successful landlord.
- Ignoring Tax Deductions
As a landlord, you are in charge of ensuring that your property is well-maintained and safe for tenants. Not only is this good for your tenants, but it can also help you save money on taxes. That’s right—landlords can take advantage of a variety of tax deductions for repairs, maintenance and depreciation. So, if you’re not already taking advantage of these deductions, now is the time to start. By doing so, you can help reduce your taxes and put more money back into your pocket each year. And who doesn’t want that?
- Trying to Do it All Yourself
Being a landlord can be time-consuming and overwhelming, especially if you have multiple properties. To make things easier on yourself, consider hiring professionals to help with the more tedious tasks—such as bookkeeping, tenant screening and property management. This will help free up your time and allow you to focus on other important aspects of your business. property management services can help take care of many of the day-to-day tasks associated with being a landlord, such as collecting rent, dealing with maintenance issues and screening new tenants. In addition, a good property management company will also be able to provide valuable advice and guidance when it comes to making decisions about your rental property. So if you’re feeling overwhelmed by the thought of being a landlord, remember that you don’t have to go it alone—there are plenty of people out there who can help make the process much simpler.
By avoiding these costly mistakes, you can help ensure your rental business is successful and profitable. Remember: being a landlord isn’t always easy, but it can be rewarding when done right. So take the time to learn about your responsibilities, stay organized and always be prepared for any potential problems that may arise. Good luck!
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