The BIGGEST Mistake Landlords Make That Has Them Lose it ALL
Already May... How did we get here? I should still be at the beach! LOL
Besides the normal boom of Real Estate in the Spring market, we have the COVID buying rush still upon us. But now, we are moving into Rental Season! We can all agree that Summer is the most sought after time for turnover on our rentals- families looking to move during summer break and no holidays making move-in/out days difficult. Nobody wants to worry about a new tenant moving in on New Year's Day!
But want to know the biggest issue I see?
Our eyes turn to dollar signs!
A tenant moves out and we automatically expect that they will leave it nicer than they found it, even after 5 years of wear and tear. We get excited about raising rent and finding a new, qualified tenant to take their place. We all secretly hope they are a single person that doesn't date (READ: No messy break-ups or random move-ins) that works all the time (READ: Less utility usage) and only orders take-out (READ: less wear and tear on appliances)
But that is not how this works! That's not how any of this works!
Wear and tear happens...even after just a few months of our new tenants living there. In my mind, my property becomes their HOME once the lease is executed. Yes, this is a business and we are in it for the money...and I have no issue saying that, but our business is providing people with a roof over their head. And we need to find a balance between being a compassionate fellow human-being and an investing maven.
And that can be tough!
There are tenants that take advantage, but there are also other Landlords that give the rest of us a bad name too. We each need to decide what type of Landlord we want to be and act accordingly. There are so many situations that arise that we need to be problem solvers, investors, but understanding of life at the same time.
Otherwise, you could end up losing it all....
Here are just a few suggestions to put in place to ensure your livelihood going into renting season:
1. Screen, Screen, Screen
Having an organized screening process is the first place to start. Listen here to the Lady Landlords Podcast episode as I share my pre-screening and screening process. Have your criteria set! Know what your requirements are. If I handed you 2 applications with only income and credit scores, would you know which to accept and how to decline the other? 🤔 If not, then you need to improve your process or you could end up in a law suit. Keep reading and I'll tell you exactly how! 😉
2. Document Everything!
A lease is the backbone of a rental property. It should have everything laid out of what is to be expected of both parties- Lessee Responsibilities and Lessor Responsibilities. There should be no guesswork when it comes to a lease. And if you are new or find it difficult to put your foot down, it's great to have your signed lease to reference. You aren't the bad guy. Blame it on the lease! Need help with what to have in your lease? Listen to the Lady Landlords YouTube Episode here as I literally walk you through my lease clauses. Also, use standard forms for your Move-in/Move-Out, Quarterly Inspections, etc so if you ever have to go to court, you will show professionalism and accuracy! Need documents? Let me know here so I can send them to you!
3. Dun Dun Dunn----😱Fair Housing Laws 😱
Yeah so that single person that is never home and never cooks? Yeah, we can't just pick that person because we want to...because we have Fair Housing Laws that we are responsible to follow as a Landlord. There are certain rules and regulations, with few exceptions that we are legally bound to in the US. As any business owner needs to be aware of the laws within her industry, we too must adhere to those that govern us. It's just the cost of doing business. Just as we have laws against insider trading and Equal Opportunity Employment laws, the rental world has their own set of conditions to follow. Be sure to read up on your Federal, State and Local laws. Not sure how to? Join our upcoming Fair Housing Laws Workshop all about screening, ESAs, security deposits and everything else that will keep you out of the courts! Register here to be the first to get information to this limited space virtual class! Details coming soon!
Happy Deal Finding!