If anyone tells you that being a landlord is easy, you can tell one of two things about them. One – they are wrong, or two – they’ve probably got an amazing property manager who makes things run like a dream, so they never have anything to worry about! Despite popular opinion, being a landlord is frustrating, disheartening and time consuming so it’s important to be aware of the common mistakes that make the job even more difficult. Here’s your guide on what to avoid, so that you can make the job a little bit more manageable!
Many landlords sacrifice what they want in a resident/ tenant just to get someone into the property and limit vacancy! This is one of the biggest mistakes as this has the potential to turn into a much bigger headache further down the line. A good resident is always around the corner and therefore patience is key. Be wary of people offering large amounts of rent up front as this often is used to tempt an owner into accepting a lesser applicant.
If a property is on the market vacant for a long time, then it is for one of two reasons. The first is that there is something wrong with the house that is putting tenants off, the second is that it is overpriced. The first is usually overcome by taking heed of the second. Price your property in line with market conditions and ensure that the property is well presented, clean and warm to attract good residents. Don’t turn tenants off before they’ve even stepped foot in the door!
Not being proactive with maintenance
Being pro-active with maintenance can seem like an option for many landlords, but if you can spend $100 now that will save you $1000 later, surely that makes a lot of sense? Whenever your property comes up for vacancy, don’t just put it back online, walk through the house and look for things you can do to make it look and feel better. A small amount of money now could save you thousands in the future should something go wrong. Look into developing an annual rolling maintenance schedule so that nothing gets out of hand. Make sure you’re on top of the basics and aim to do one bigger job every year or so.
Keeping out of touch with the market
Owners can catch themselves chasing their tails when they fail to keep in touch with the market. Especially now with changing market conditions. The goalposts are continually moving. With more and more new rental stock coming onto the market, the rent for older character housing is starting to drop and investors need to be aware of this. Please don’t spend a month on the market and then realise you were $100 too expensive. You also don’t want to be in a position where you find that your rental property is drastically under-priced and to increase the rent to align with market values could see you lose your ideal tenant.
Not inspecting the property properly
Do you want to pay insurance premiums only to discover you’re not insured? Easy, just don’t do your property inspections! Most insurance policies will require you to inspect your property either every three, or every six months. You’ll need to keep a track record of your inspections and make sure that all maintenance reported in the inspections is attended to ahead of time. It may seem time consuming, but it’ll be a time and money saver later on in the piece. Don’t forget to take photos and videos as proof should you ever require it.
Getting the right people to help
Being a landlord is an ever-evolving job. It is not the easiest job in the world and there are so many different aspects to look after that it can be easy to overlook something. Surround yourself by people who can help.
Every landlord, even if they are looking after their home privately should have a property manager that they can call on for advice, a real estate agent, an accountant and a mortgage and insurance broker. The most important thing to remember is that when you’re a landlord you’re running a business, and just like any other business there are lots of moving parts. Having specialists that you can trust to help manage the process will reduce stress, save you time and in the long run, they might even make your business a little more profitable!
So now not only do you know the most common mistakes, but you also know what to do to avoid them! We’d welcome a call anytime to guide you on your journey as a landlord.
For obligation free advice, call today on 04 381 8604.