How to be­come a suc­cess­ful landlord

Lesotho Times - - Property -

BE­ING a landlord comes with a lot of de­mands — cre­at­ing lease agree­ments, screen­ing tenants, shelling out evic­tion notices, fol­low­ing fair hous­ing laws and mar­ket­ing — that can eas­ily be­come over­whelm­ing, es­pe­cially for first-timers and own­ers of mul­ti­ple ren­tal prop­er­ties.

But, as with any­thing, if you know what you’re get­ting into and have the proper sys­tems in place, “land­lord­ing” can be a very re­ward­ing and prof­itable ven­ture.

1. Find tenants-or meet the cur­rent ones. If your prop­erty al­ready has tenants, take the time to meet them per­son­ally. Talk to them about how they like liv­ing in the unit and find out if there are any out­stand­ing is­sues they’d like re­solved. Re­view their ex­ist­ing lease, but re­mem­ber that you’re bound by the terms of the cur­rent agree­ment. You can’t make any changes in ren­tal rates or terms un­til the lease ex­pires.

If you need to find tenants for your prop­erty, stick to the ba­sics when advertising--print ads, on­line sources, signs, fly­ers and bul­letin boards. De­ter­mine your tar­get mar­ket and ad­ver­tise ac­cord­ingly. For in­stance, if you post your ad around col­leges or uni­ver­si­ties, you’ll likely at­tract mostly col­lege stu­dents.

High­light fea­tures that’ll ap­peal to likely ap­pli­cants based on where your unit is lo­cated. For ex­am­ple, if you’re rent­ing a two-fam­ily house in a sub­ur­ban lo­ca­tion with a lot of fam­i­lies, you might want to high­light the prox­im­ity or rep­u­ta­tions of nearby schools or parks.

Be sure to avoid vi­o­lat­ing Fair Hous­ing laws and mak­ing dis­crim­i­na­tory state­ments in your ads. Don’t show any par­tial­ity to any par­tic­u­lar type of ten­ant, such as col­lege stu­dents, room­mates or older peo­ple. This means you’re not al­lowed to say “no chil­dren” or “no dis­abled per­son” or even hint that your unit would be un­suit­able for fam­i­lies or dis­abled peo­ple. If you have doubts about the word­ing of your ad, ask an at­tor­ney to re­view it.

Screen po­ten­tial tenants. Once you’ve found a po­ten­tial ten­ant, don’t make the mis­take of skip­ping the screen­ing stage. Per­form­ing a thor­ough check of each qual­i­fied ap- pli­cant’s his­tory is crit­i­cal to se­cur­ing re­li­able tenants who’ll take care of your prop­erty and pay the rent on time. Over­look­ing this step puts your in­vest­ment at risk and po­ten­tially could re­sult in count­less headaches and costs down the road.

Screen po­ten­tial tenants for crim­i­nal and credit is­sues, as well as em­ploy­ment and ren­tal his­tory. Pay­ing a screen­ing com­pany to do a thor­ough search in ac­cor­dance with the law is well worth the cost, even if you avoid only one risky ten­ant.

Use the right forms. Pro­tect your in­vest­ment and your san­ity by sign­ing a writ­ten lease with all tenants. This point is es­pe­cially im­por­tant. Whether you’re rent­ing your unit to a fam­ily mem­ber (which, by the way, isn’t usu­ally a good idea), a friend of a friend, or a per­son who passed your screen­ing with fly­ing colours, have your ten­ant sign a lease that spells out all of the im­por­tant in­for­ma­tion: names of all tenants oc­cu­py­ing the unit, ad­dress of the unit, name of landlord, length of lease term, ren­tal rate, due date of rent, ac­cept­able forms of pay­ment and late fees. Avoid oral agree­ments at all costs.

You should also spell out your poli­cies on guests, noise and satel­lite dishes, for in­stance. You can in­clude ad­den­dums to de­tail your pet, park­ing and smok­ing poli­cies. Make sure these are agreed to and signed by your ten­ant. There are many im­por­tant rules you want your ten­ant to fol­low, so be sure to share those with any new tenants.

Han­dle re­newals and evic­tions. Re­newals are the eas­i­est way to main­tain a steady in­come flow from your ren­tal prop­erty. The cost of search­ing for and sign­ing new tenants sig­nif­i­cantly out­weighs most costs you might in­cur to keep good tenants. With this in mind, con­sider re­plac­ing worn carpet or ap­pli­ances and ap­ply­ing a fresh coat of paint to keep a good ten­ant happy at re­newal time. A small in­crease in rent might be eas­ier for tenants to ac­cept if they feel they’re get­ting some­thing in re­turn, like a new fridge or a ceil­ing fan.

Evic­tions are tricky, and the rules for evict­ing a ten­ant vary from state to state. If you’re un­sure of how to get rid of a ten­ant who won’t leave, seek le­gal ad­vice im­me­di­ately. Along the way, you should keep good records so you have ev­i­dence of your claim and send the re­quired notices on time. Evic­tion pro­ceed­ings can be time-con­sum­ing and ex­pen­sive, which is why you should screen your tenants care­fully and work to hold on to good ones.

Be­ing a landlord re­quires work. It can be re­ward­ing and prof­itable, as well as ex­haust­ing and frus­trat­ing at the same time. By fol­low­ing the steps out­lined above, you’ll have an even greater chance of be­ing suc­cess­ful.

It’s a lot cheaper to re­tain a ten­ant than to find a new one, so do what you must to keep your tenants happy.

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