Tips for First Time Landlords

Tips for First-Time Landlords

Having a rental property or properties to manage can be an exhausting task. Landlords and property managers need to be a multi-tasker in order for the work to be done all at once.

Buying your first rental investment property is a good idea. You can maybe start with a single-family home because it is a lot easier to maintain there's not much wear and tear to fix if ever something breaks. But if you decide to invest multi-family or commercial properties, it can be more lucrative if properly handled and with precautions to make it successful.

There are lots of things to consider before you decide to become a landlord. So, we've created some relevant information about tips for first-time landlords to help landlords especially those first-timers avoid surprises later on.

• Put everything in writing. You need a written agreement or written documentation as evidence to help protect yourself from unavoidable circumstances and to fully protect your rights as landlords. If ever the worst situation happens like you need to take a tenant or other party to court, you will not find it hard to convince the court of the violation made because you have a written agreement or written documentation as evidence to provide.
• Screen tenants. Tenant screening is a process used by landlords and/or property managers to evaluate their prospective tenants, to assess if they can full the obligation of whatever stated on the rental agreement and can take care of your property like it's their own. It will help protect your property and will help you identify the qualified tenant. Depending on the package that you will choose, it will give you an idea about their current financial situation, criminal history, previous eviction history, etc.
• Follow the Fair Housing Act (FHA). It is a federal act in the United States meant to prevent a landlord from discriminating against potential tenants by offering an equal opportunity from obtaining a house. The seven-class protected under the Fair Housing Act are the following:
  
  • Race
  • Color
  • Religion
  • National origin
  • Familial status
  • Disability
  • Sex
• Collect rent online. It will help save landlord's time, lessen your stress, help you and your tenant's important information secured, it helps tenants establish recurring payments, it provides tenants with payment options and reminders when rent is due, and it avoids or at least lessens late payment issue due to its notification and reminders of payment.  
• Take photos of the property. It is important to take photos before tenants move-in and when tenants leave the property, if possible, date them. It will stand as evidence and this will protect not only the landlord but the tenant as well if in case there are any unavoidable circumstances happen in the future. 
• Address important things before tenant move-in. It is important that the landlord address important things with the new tenant because it will not only help the landlord to make things easier but the new tenant as well when the transition happens. Examples of issues to tackle with the tenants are the following:
  • The signing of the lease. Before signing the lease with the tenant, ensure that you explain all the details like section by section and that tenant completely understand and read everything stated on the lease or rental agreement before signing it.
  • Clean the property. The landlord should make sure that the property is thoroughly clean before a tenant move-in. It's a level standard for the tenants and how the unit expected to be returned. One of the landlord's responsibility includes an obligation to provide the tenant with a warranty of habitability. This is to ensure that the property is clean, livable and safe.
  • Repair any damage or safety issues. This is also one of the landlord's responsibility. You are obligated to maintain the property in a habitable or livable condition. This is a general rule in most states. But on the other hand, the tenant also has to duty at the same to notify the landlord promptly if there's any repair needed to be fixed, and landlord should act immediately to prevent more damage. 
  • Change locks. Before the new tenant move-in ensure that locks are changed to avoid any issues. You do not want the previous tenant to still have access to the same unit. The main reason why it has to be changed is for the security of the new tenant and to protect you from any liability. 
  • Go over the rental checklist. This will enable you to document, determine and compare the condition of the property when a tenant moves-in and when a tenant moves out of the property. You may walk through the property with the tenant and may let them document the condition of the property as well. Have them sign on the checklist as an acknowledgment that they agree to the condition of the property. You may take photos of the condition of the property; this may use as evidence if ever tenants have any dispute.
  • Rent and security deposit. The landlord should collect the security deposit before the tenant moves-in, this will help protect the landlord if ever tenant violates the terms of the rental agreement. And it will serve as an assurance that if a tenant fails to pay rent and create some damages to the property, the landlord can use the money to regain from the loss of rental income or fix the damage.