You have decided to self manage your rental properties, or have been doing so for quite some time. Saving on management fees can certainly help your bottom line, but are you making any mistakes that could come back and bite you in the long run, and potentially cost you more money?
Here are some of the most common mistakes that can be made when self managing rentals.
The Top 4 Landlord Mistakes
Having a Poorly Constructed Lease
Putting the time in to make sure your lease is air tight from a legal perspective is absolutely imperative. Making sure it is clear for the tenant to understand and that it protects you while staying in line with Federal and Local regulations is an absolute must when starting out.
Not Enforcing your Lease
Doing your due diligence to make sure you have a clear, strong lease in place is important, but it means nothing if you are not going to enforce what is outlined in the lease. Items such as rent collection, late payments, property upkeep, deposit guidelines and anything else that is outlined with a consequence should it be broken must be enforced. If you do not do this, there boundaries between tenant and landlord can be blurred and you will eventually be taken advantage of. By enforcing the lease the very first time a lease violation occurs will set the right tone with your tenant and it will be less likely that a future issue will occur.
Lackadaisical Maintenance Standards
Issues with the property should be taken care of promptly. Not only is it good business and shows your tenant that you are holding up your end of the deal, the property after all is an investment, and you should want to be proactive in making sure that you protect your investment. While it may cost you on the front end to make needed repairs, delaying any necessary maintenance on the property will only be more expensive the longer you wait.
Poor Tenant Screening
Sure, you want to fill vacancies quickly but the worst thing you can do is disregard good screening practices and allowing the wrong tenant into the property. You will want to be diligent about finding the right tenant to move in, even at the cost of allowing the property to sit vacant for a longer period of time. Bad tenants are expensive, can tax your time and overall, can be very stressful. Do the right thing and screen appropriately. If you have bad tenants, get them out of the property quickly and legally.
Self management most certainly has its advantages, but do not fall victim to some of the common mistakes by allowing yourself to be a complacent landlord.