Real estate investing can help provide your family security and financial stability. In 2022, landlords raised rent prices by more than 12% in the United States from the previous year.
Buying an investment property can be exciting, but only if you manage it correctly. There is so much you must do when housing tenants that, as a new landlord, you may need to learn about.
You want to avoid making mistakes that can cost you your tenants, leaving your rental property vacant. After all, when there're no occupants, there's no revenue.
So if you want to do things right as a first-time landlord, keep reading to learn five essential tips before you lease your property.
Tip #1. Ensure The Property Is Habitable
All landlords should ensure their investment properties are habitable. This means the unit must be ready for the new tenants to move in. For instance, you must address any repair and maintenance work before the property is occupied.
You have to ensure the property is safe, everything is in working order, and all issues (i.e., mold, dampness, rodents, etc) are attended to. Finally, you want to ensure you've installed adequate lighting around the property.
Tip #2. Always Screen Tenants
Next, once you've completed the property marketing for your rental unit, you should have a few prospective applicants. The most crucial step you must take is proper tenant screening. This means running a background and credit check to ensure everything is above board.
A thorough background check will reveal any criminal, rental, or eviction history. This will allow you to make an informed decision about who you want to lease your investment property to, and you can avoid renting to bad tenants.
Tip #3. Do a Walkthrough
Once you've accepted a tenant, you want to do a walkthrough of the property with them. This is so both parties are aware of the condition of the unit when the tenant takes occupancy.
Document as much as possible with photos and video. When the tenant moves out, do another walkthrough to ascertain what needs fixing and at who's expense.
Tip #4. Offer Multiple Payment Methods
If you want to ensure the rent is paid on time, offer your tenants multiple ways to pay the rent. Some ways other landlords offer include:
- Using an online tenant portal
- Using payment apps
- Setting a drop-off location for checks
- Collecting rent in person
- Setting up direct deposit through your bank
- Collecting rent through the mail
Mobile payment apps like Venmo and PayPal are becoming increasingly popular and are a great option if you're leasing to younger tenants. Electronic payment methods make it easy for tenants to make rent payments, and online payment systems can also send out rent-due reminders.
Tip #5. Hire a Property Management Company
Finally, if you want to avoid being hassled with any of this, you can hire property management services to do it for you. This is an excellent option if you have more than one investment property.
Handling all the responsibilities can take up much of your time. Handing everything to a qualified property manager can take the strain off you, leaving you to enjoy doing other, more exciting things.
Landlords 101: Passed
Becoming a first-time landlord is a great responsibility. Landlords are responsible for their tenants' safety and must ensure the property is habitable.
Screening tenants is a step you shouldn't skip because you need to know who you're leasing to. Remember to do a walkthrough to document the property's condition and offer multiple payment methods. This way, you ensure the rent is paid on time.
Finally, if this is too much work, contact us today. Our full-service property management company services the greater Merced, CA area, and we're waiting for your call.
