There is a lot to think about when you’re trying to find a tenant for your rental. Both first-time landlords and seasoned landlords can make mistakes when renting our their property. These mistakes can be costly, but they’re also avoidable. We’ve compiled a list 9 common mistakes made by landlords.
1. Not Screening Tenants
Some landlords avoid a thorough screening of their tenants because they think that it takes too much time or money. However, it could cost you more in the long run if the tenant turns out to be a bad fit. Take advantage of free tenant screening and get a tenant eviction report, credit report, and criminal history.
2. Violating Fair Housing Laws
The Fair Housing Act prohibits discrimination on the basis of color, national origin, religion, sex, disability and the presence of children. If your interview questions ask clients to provide information in these categories, you could be in violation of the act. Read more about Fair Housing laws.
3. Pricing Rent Too High (Or Too Low)
If the rent is too high, then you may have a hard time attracting tenants. There are also some drawbacks to pricing rent too low. While low rents attract more tenants, you have to keep in mind that owning a rental is like running a business. There are costs associated with maintaining the property, and you want to make sure your rent covers those costs. It’s a good idea to do some research on rent prices in your neighborhood to make sure your prices are competitive.
4. Not Taking a Detailed Move-In Condition Report
A detailed move-in condition report protects you and your tenant from any disagreement on property conditions when the tenant moves out. It also shows your tenant that you care about the condition of your property. If you’re not happy with the standard paper checklist, consider upgrading your condition report to a digitized report, like those offered at HappyCo.com.
5. Including Bad Photos in Your Listing
When someone sees your listing, it may be the first time that they see your property. Make sure your photos make the right impression. Avoid using photos that are out-of-focus or include clutter. Take advantage of your property when it’s vacant and get photos of the empty rooms. This will make your property look clean and spacious. A good photo allows your applicants to see themselves in your property.
6. Failing to Give the Property the Best Online Exposure
Having a great property and great pictures won’t do you much good if nobody sees them. Many people are searching for rentals online, so a strong online presence is a key to attracting tenants. Sites like Craigslist.org allow you to post your listing for free. Having an attractive listing is also key. An easy-to-read listing with great photos will attract more applicants.
7. Being Unprepared for Maintenance Issues
Maintenance is part of the package when you own a property and repairs can be costly. Keep this in mind when you’re thinking about your costs and consider putting some money aside for an emergency fund in case something unexpected happens. The landlord has a responsibility to keep the property up to a certain standard and it’s good to prepare for this so you won’t be surprised.
8. Not Knowing Landlord-Tenant Laws
Knowing the laws before you come up with a lease or rental agreement could save you some time and help you avoid legal issues. As mentioned before, landlords have certain responsibilities, and some are defined by law.
9. Treating It Like a Hobby
Keep in mind that your rental property is a business. It might be tempting to forgo drawing up a lease for your tenant, but it could cost you. A lease is a contract that protects the landlord from future issues. The landlord is also obligated to follow the lease, so be careful about what goes into it.
As a business, your aim is to make a profit off of the property. As mentioned in #3, pricing the rent too low is bad for business. Keep track of your expenses and don’t forget to take those into account when you file your taxes.
You may have recognized one or more of these mistakes as something you’ve done before. Knowing these mistakes can help you avoid them and make the rental process easier and more profitable in the long run.