The potential for income generating properties and becoming a landlord is drawing people to the rental market. Whether it’s a stable return on investment, or the possibility of passive income, becoming a landlord has many benefits to offer existing and future home owners.
However, when owning any type of business there are always challenges and drawbacks. Some first time landlords approach renting out their properties with the assumption that there won’t be any problems with tenants and that the money will effortlessly flow in. Don’t let their naivety influence you- being a landlord requires research and diligence in order to maximize your returns while providing a stable rental unit to your tenant.
There are many guides and tips online that are available for the first time landlord. Most of the information out there tends to collect around specific themes and are condensed below to give you the three main points to consider when looking to rent out a home or apartment.
Know The Rules And Regulations
Knowing your rights as a landlord and your duty to fulfill your side of the landlord-tenant equation should be the first step you take in gaining a better perspective of what makes a good landlord.
Landlord tenant agreements and leases are standard reading material before you even think about having a potential tenant view the property. Know the lease inside and out, and if some parts seem confusing to you, seek legal help to clarify any misunderstandings.
The leg work you do know will pay dividends later on if or when a dispute or issue occurs and you’ve done your part to the letter of the law.
Pick A Good Tenant
The best way to ensure that your rental experiences go as smoothly as possible is to rent to a reliable tenant. Choosing one can be difficult and some landlords spend a great deal of time search for one. But it doesn’t have to be that difficult, just stick to the template below:
- Get to know your tenant by speaking with them personally. Showing them the unit and opening up a conversation will give you a better sense of who they are as a potential renter.
- Do your reference checks including a credit check and get a list of previous landlords. You want to make sure they are a mature tenant that will responsibly pay you on time every month.
- Treat this as a business decision and choose the right tenant based on your criteria. This way you won’t have any hurt feelings and will develop a framework for future tenant selections.
Make It Easy On Yourself
This includes things like logistics, maintenance, cheque cashing and other externalities that will take up the bulk of your time as a landlord.
Consider the distance of the rental unit from your home. If it’s a far drive or even a commute, you will have to account for the driving time in case you have to make an emergency visit to fix a broken appliance.
Maintenance and even property management can be outsourced but these decisions can eat away at your return on investment. It’s important to weigh the pros and cons of automating your rental units. As is the case in any endeavour, seek out experts and speak to people that use property management services to see if it’s an appropriate option for you.
For many people, hiring professional property management (like us) to manage their rental property is ideal. If you want to be hands-off with yours, property management may be a good option for you.