Managing your own rental property is not rocket science. In fact, if you’re going to stay in the same town as your property and are okay with taking calls at odd hours, we could show you how to do it yourself. Managing your own rental property is about mitigating risk, making problems go away, and staying within the law. All of which I am confident the average citizen can more than handle. With that said, many landlords get tripped up. Here are 14 common mistakes property owners make and some tips on how to dodge them like a pro.
1. Breaking The Law.
Don’t break the law. Obvious, right? Nope! If you don’t read anything past this, heed our advice here. Washington State has some of the strictest tenant-landlord laws in the nation. And they will only tighten over time. And guess what? They won’t be in your favor. Prior to renting your home you need to confirm what the laws are in the state, county, and city you rent your home in. That includes: fair housing laws, advertising, screening, notices, rent, security deposit implications, and much, more. You’re a law-abiding citizen, right? Of course. But when there is a maze of legal jargon to sift through, this is the number one thing that will hold you up. There are plenty of resources for this, just reach out and we can point you to them. Sidenote: this is the #1 reason we recommend hiring a professional property manager in the first place.
2. Ignoring Maintenance.
Alright, so you’ve checked all your laws. Awesome! What’s the next biggest kicker? Ignoring maintenance in your home. The problem won’t just go away. And that eager tenant who texts you daily about the issue that-is-so-important-they-absolutely-need-it-done-now-or-they-might-Tweet-about-it isn’t going to stop texting you until the problem is solved. Do not be greedy, and always follow the law. If something needs to be replaced, get it done and do not wait. If you can’t afford a CapEx item off the bat, renting your property may not be the right fit for you.
3. Overpricing Rent.
“But you don’t get it, my home is so nice. It’s worth the price!” or "My mortgage is $2,500, I can't go below that!" Sound like you? Setting the right rent price is a fine art. If you price too high, you’ll scare off potential tenants; too low, and you might as well be handing out keys for free. Do some research on comparable properties in the area and price accordingly. After all, your property isn’t a rare Picasso—no one’s fighting over it just yet. Do the math, too! One month of vacancy might crush your cashflow for the year. What’s $100 less per month compared to that?
5. Failing to Create a Solid Lease Agreement.
A handshake might have worked in the old days, but today’s tenants need a solid lease agreement that covers everything from rent due dates to pet policies. You need to outline every aspect of a tenancy that may come up. From who covers pests (there’s laws for that, too), to how soon you’ll conduct maintenance after notification. A well-drafted lease can save you from misunderstandings and disputes down the line—because “No pets” should definitely not mean “One pet of any size.”
6. Being Too Friendly.
“Ah, it’s going to be great! I’m going to rent my place out, they’re going to pay my mortgage, and we’ll even have cookouts together and talk about how amazing our tenant-landlord relationship is!” said nobody, ever. It’s great to be friendly, but being too chummy with your tenants can blur professional boundaries. Even your own friends! You have no idea how many owners, after a few months of DIY landlord, have asked us to evict their friend! This is real! If your tenant thinks you’re their buddy, you may find it awkward to enforce rent payments or rules later on. Beyond being awkward, you could put yourself in a legal position that makes it harder, or impossible, to enforce policies you put in the lease. It’s only as meaningful as you enforce it. Keep things light but professional; you’re not auditioning for a buddy cop movie.
7. Neglecting Marketing.
Just because you own a property doesn’t mean tenants will magically find you. Neglecting marketing efforts can leave your property vacant for longer than it needs to be. Free places to advertise your property are: Zillow, Avail, and Apartments.com. Between those three places, they will syndicate (for free!) to over 20+ sites. In addition to this, join a Facebook page for your community and post your Zillow listing there too!
8. Not Being Available.
This is the cornerstone of a quality landlord. Be available for communication and establish clear channels—whether it’s via phone, email, or even smoke signals. Quick responses can help you keep a happy tenant and avoid being the topic of their next dinner party.
9. Thinking Your Home Is Unique.
“But it is! You should see the home I have. Honestly, it will probably go for DOUBLE what market rent is! You just see!” You might be too busy managing other aspects of life, but here’s the tough news, your home is not unique. Tenants want: hot water, lights, warm or cool air depending on the season, working appliances, rapid communication, solved maintenance issues. There it is. Does your home have that? Every other home does too. We think it is important for every DIY landlord to get over this mental hurdle because the quicker they look at their home as sticks, bricks, piping and dirt, the quicker they can emotionally detach themselves from rejection and other problems that arise.
10. Failing to Document Everything.
A good landlord documents everything—leases, maintenance requests, tenant communication, and any unfortunate incidents. This is your best defense if disputes arise. Plus, you’ll have a record to remind yourself why you chose this profession! Trust me, having written proof beats playing the “he said, she said” game.
11. Underestimating Turnover Costs.
When a tenant moves out, costs can add up quickly. Cleaning, repairs, and marketing can all drain your wallet fast. Prepare for these costs in advance so they don’t hit you hard. Budget for this monthly so it is easier when the time comes. Remember, budgeting for turnover is a lot cheaper than budgeting for regret.
12. Neglecting to Update Safety Features.
It’s easy to forget about smoke detectors and carbon monoxide alarms, but failing to keep these updated is a risk you don’t want to take. Regularly check these. Better yet, put it in your lease that it is the tenant’s responsibility to change the batteries. Talk to them about this before moving in and ensure they follow it. It’s for their own safety at the end of the day too.
13. Being a DIY Disaster.
“I’ll just do it myself! How hard could it be? Besides, contractors just rip people off.” While it’s great to save money by tackling repairs yourself, not everyone is cut out to be a handyman. If a job seems too complex, don’t be afraid to call in the pros. Keep in mind legal requirements for being up to code as well. You don’t want to end up known as “that landlord” whose last DIY project made the local news for all the wrong reasons.
14. Get Rental Insurance.
This is simple. Call your insurance company. They have this product. Get the best insurance you can afford.
Conclusion
There are an infinite number of steps to this, but these are the big ones. I want to reiterate, it is not rocket science. A lot of it is diligence and consistency. If this sounds like too much for your fancy, or you want to talk further about what we offer, feel free to reach out.
