It’s certainly tough to self-manage your rental unit. It can take some time to develop the strong skills of a landlord. As a new property owner, you’re bound to experience some oversights, but there are some tips and tricks we’ll share with you on how to control and minimize them.
Avoid lawsuits or dealing with financial losses by following our tips for avoiding these common mistakes:
Eliminating a Written Leasing Agreement
If you don’t bother having a written contract, you miss out on having a binding agreement that protects you and offers solid security. Through a written lease agreement, you can outline your property’s terms and conditions.
It’s tough to trust verbal agreements alone since it’s easy for the other party to feign ignorance and deny your agreement. With a written leasing agreement, DIY landlords are assured that renters will comply with the property policies contained in the contract.
You don’t have to formulate your own lease from scratch though. You can engage the services of a property manager in designing a proper leasing agreement for you.
Being Inconsistent With Property Inspections
Property inspections can be quite time-consuming, but it also eliminates a ton of stress. You can check on potential property issues before they become larger, more expensive repairs or renovations.
Since you’re responsible for creating a habitable environment for your renters, it’s a good idea to perform regular property inspections for proper rental maintenance.
With a property in excellent condition, DIY landlords can make their renters happy and inspire them to renew their leases to stay longer. You’ll also limit tenant maintenance requests and complaints. It also helps you meet and maintain the safety standards designated by local and state units.
Lacking Preparation for Vacancies
When you’re advertising a vacant unit, you have no income. You can face this situation when a renter suddenly moves out.
As a DIY landlord, it can be hard not to have any profits, but if you’ve prepared a budget for no vacancy situations then you should be able to handle this situation properly.
Set aside at least 3 months of expenses for your savings fund to minimize your stress. This allows you the time to be more thorough and careful with your tenant screening process. You can take your time reviewing applications to filter out any problematic renters. You can also focus on marketing to ensure your ads are more effective.
Delaying Tenant Evictions
As much as you want to give fair chances, DIY landlords can end up allowing renters to take advantage of them, including breaking the lease agreement and holdover tenancy. You should learn to make business decisions and be decisive, especially when performing evictions for renters that don’t pay on time.
While it can be difficult to enforce the agreements set out in your renter’s lease, keep in mind that you’re a business owner, and not being clear with your renters can lead to more problems down the road.
Situations like these can easily be avoided when you hire a property manager who’s always looking out for your best interest and protecting you from problematic renters. You also gain a professional distance from your renters with a property management team acting as your representative.
One of the greatest benefits of working with a property management company is that they have ample knowledge in evicting problematic renters, should the situation arise.
Lack of Ability To Identify the Market
As a DIY landlord, you can have blindspots, especially when advertising your rental unit. The rent price you set can either be too high or too low. You might just simply copy off from the market listings without properly studying the features and amenities you offer in contrast to your surrounding competitors.
DIY property owners can also neglect to adjust the rent price when market demand rises, as they’re afraid that the renters would move out. But hesitating to do so also reduces your optimal income. A rent price adjustment is sometimes necessary as insurance rates, tax payments, and maintenance expenses increase.
Ignoring Credit and Background Checking
With DIY landlords wanting to save time, it can translate to lack of thorough background checking. Screening your renters properly is crucial to your rental’s success. When you take the time to do a thorough review of credit and background history, you end up with better renters who pay on time and treat your rental home well.
Failing To Consider the Amount of Time Required by Self-management
If you opt for the DIY route, you can easily end up sacrificing your time, and it can be challenging to fulfill all of your obligations. When you hire a property manager, they can dedicate their time fully to managing your property and resolving tenant concerns.
Self-managing landlords can fail to account for the time required for the job, and only see the savings earned from not paying anyone. But giving up your time is costly, if not more. Your investment stops becoming a passive income when you are spending all day and night working.
Not Taking the Learning Curve Into Account
Even if self-managing your rental is possible, you can still lack a lot of skills and knowledge. Hiring a property management company lets you skip a lot of steps as they’re able to provide their industry expertise.
You gain immediate access to tried-and-tested systems and methods. It’s also relieving to have a full support system that saves you plenty of time and helps manage your renters and property.
If you're interested in working with a professional and experienced property management company, or have any questions, look no further than Rent Easy. We have gained years of expertise managing rental properties in the Hampton Roads area, and are trusted by dozens of landlords. Call us today at 757-347-8952.