How First Time Landlords Can Protect Their Investment

Becoming a first-time landlord is a lot like becoming a first-time parent. For starters, there is the responsibility. You don’t have to change your tenants’ diapers; make sure they eat their vegetables or go to bed. But you will need to make sure their apartments are livable, and if you’re not using a property manager, this can mean early morning calls about broken pipes or making sure the snow gets ploughed in the winter.

While you collect rent each month, the buck stops with you when dealing with the inevitable slew of tenant problems that will crop up over time. This doesn’t mean you have to lose money, as here are some tips every first-time landlord can follow to protect their investment.

Keep Meticulous Records

One way that many first-time landlords can get into trouble is by cutting corners when it comes to paperwork. The reason for this is simple: Many first-time landlords lack the experience to know what documents they need for their rental properties. As such, leases can be improperly structured, and other documents, such as condition reports, can be incomplete or missing altogether.

While this might not sound like a big deal, it can cause problems when trying to evict a tenant or even when you try to sell the property. In addition, having incomplete paperwork could give tenants the upper hand in any disputes. As such, protecting yourself starts with keeping meticulous records.

Maintenance Matters

One potential downside of being a landlord is the need to constantly take care of the properties you own. Sure, you want to attract tenants who will treat your property like their own, but there are times when you will be forced to roll up your sleeves and make sure maintenance and repairs are happening. If not, you might end up paying more money down the road.

As such, you want to keep on top of everything on your property.  This can be as minor as an electrical outlet not working to ensure kitchen pipes don’t freeze during the winter months.

While this might sound like you will have to sleep with your toolkit next to you, having a maintenance plan in place will help you be more efficient. This plan will highlight the major systems on your property and outline the proper schedule for performing maintenance checks.

Doing so will help you find problems while they are still small and give you a way to organize your days better.

Lastly, don’t try to do everything yourself. This is especially true if you are not the best with your hands. Instead, build a stable of reliable contractors you can call on to get things done quickly and at a reasonable price.

Know The Rules

You don’t need to go to law school to be a landlord, but knowing your and your tenant’s rights will help ensure that you don’t face costly issues. Not abiding by these rules can be expensive and hurt your reputation as a landlord, making it harder to attract good tenants.

One example of new landlords not understanding the law is when they refuse to rent to tenants who need service animals. In these situations, the landlord usually thinks it is their property and can set whatever rules they want, but this is not the case in most places across the country.

As such, it pays to know the laws governing tenants’ rights to avoid hefty fines down the road.

Know Your Tenants

This is another mistake that newly-minted landlords tend to make. They often fail to screen prospective tenants properly, mainly because they don’t know where to begin or what questions they can ask.

Don’t let this happen to you; instead, work with a service provider specializing in tenant background checks. This will help you get the information you need in a way that does not violate anyone’s data privacy expectations.

Don’t walk away from this article thinking that being a landlord is not for you. Take these lessons to heart, as they will ensure that you don’t make costly mistakes that could sour your first time as a landlord.