You’ll get more return out of your investment if you take the necessary steps to provide your tenants with a good experience and if you actively manage your rental property.
These tips will help you become a landlord people want to rent from while maximizing the return on your investment:
Be aware of the law. As a landlord, you’re required to provide your tenants with a rental that meets certain criteria. You also need to know about the law in order to protect your investment. Take note of these key points:
-You’re liable if a tenant sustains an injury. Purchase liability insurance and do your best to create and maintain a safe environment.
-You’re legally required to provide your tenants with a few necessities. Property owners are usually required to provide their tenants with hot water, electricity, heat, and to notify them with 24 hours notice before entering the property.
-The lease agreement you sign with your tenant is a crucial document. The agreement needs to include information on your tenant, details about the security deposit and rent, and any rules you want to enforce. Check with your provincial jurisdiction- in Manitoba we have forms provided by the province to use, which makes it easier to get started.
-Make sure you address pets and smoking in your agreement. Some landlords will accept pets, but take an additional pet deposit from tenants.
Select your tenants carefully. Finding the right tenants will make your job a lot easier. Legally speaking, you cannot select your tenants based on their age, sex, or race. Instead, use credit history, proof of income, and employment history (current + past) to qualify tenants.
You can also ask prospective tenants for references.
Be prepared. A number of things could happen to keep you from generating a profit. Managing your property includes preparing for situations such as natural disasters or legal issues with your tenants. These steps will help you prepare for unforeseen problems:
Put some money aside to cover repairs and maintenance.
Purchase sufficient insurance.
Find a lawyer and a tax expert who can help you.
Define your role as a landlord. Some property owners rely on turnkey services to manage their rental properties. I recommend self-managing for at least one year before getting professional property management services so that you get your feet wet first, and know what you expect from the property manager.
Others have a more active role, which includes inspecting the property, performing repairs, and collecting rent in person. Ask yourself these questions:
-How much time can I afford to spend on managing this property?
-What are my investment goals?
-What are my natural talents and abilities, and where are they best suited?
Becoming a landlord can be stressful and requires time and hard work. However, a rental property is also a great way to invest in real estate due to both the appreciation of the property and the monthly rental income. You can be collecting rent while watching the value of the property rise, and your mortgage balance fall every month!
Look into joining a local Landlords’ Association to get in touch with other landlords in your area. They’ll provide you with some helpful tips and give you a good idea of what to expect.
Contact us if you need help getting started as a Landlord. We look forward to helping you create systems to make your journey as a Landlord a success!