DIY Landlords - What to Do When You're in Over Your Head
Renters Warehouse Blog
DIY Landlords - What to Do When You're in Over Your Head
There's a burst pipe at the rental, the tenants need some extra time coming up with the rent, and you have a sinking feeling that your no-pets policy may have been disregarded -again...
While owning Rent Estate(tm) -especially in this booming rental market can be an exciting and extremely financially rewarding venture, it's no fast track to guaranteed success. The reality is that overseeing rental properties requires work -hard work. Even professional landlords with years of experience sometimes find that they're in over their heads.
If you're like most landlords, it can be difficult to know when you should wade in and attempt to handle things yourself -and when it's best to call in the professionals to take over.
Creating an action plan ahead of time can help you know what to do when you get that dreaded phone call about overflowing toilets at 2 am. With this in mind, let's take a look at some common problems that landlords often face -and see when you can DIY, and when you should seek professional help!
Issue #1: Late Rent
One of the most common problems that landlords face is late-paying tenants. Whether you're dealing with tenants who are consistently late or someone who is a month, or more, behind on the rent, letting rent slide is often the start of a downward spiral, and it can be difficult for tenants who owe more than one month's rent to catch up.
Solution: It's important to be proactive when it comes to rent collection. Set policies for late payments, and uphold them. Many landlords find it helpful to implement a fee for past-due rent -usually about 5 percent of the rent. For chronically late tenants, you'll want to start the eviction process sooner rather than later. Never allow a tenant to be habitually late with rent payments -as being lax on this issue often sends the message that you don't care, encouraging the tenant to continue to pay rent late in the future.
Issue #2: Lease Violations
While the most common form of lease violation is late or unpaid rent, other problems include tenants bringing dogs into a no-pets rental, smoking in a non-smoking unit, or housing people that aren't included in the agreement.
Solution: Stick to the rental agreement. Being casual about the terms of the lease sets a precedent and tells the tenants that the lease doesn't matter. Always take action against violations of the lease, according to the terms that you have outlined in the rental agreement.
Issue #3: Tenant Drama
Tenant drama is another common problem for landlords -especially if you own apartment complexes or condos. Late night parties, excessive noise, and issues with neighbors are all common grievances amongst tenants, and unfortunately, as the landlord, you will end up hearing about most of them!
Solution: Define emergencies for tenants, and the hours that they can call with non-emergencies. Implement house-rules by which tenants must abide (example: no pets, no smoking, no excessive noise after 10 pm) and be sure to enforce these policies. Remember: too many violations can, and should result in an eviction notice.
Issue #4: Damage to Rentals
It's normal for rental units to require a good cleaning and the occasional coat of paint in between tenancies, sometimes tenants will leave a wake of destruction when they leave that goes beyond standard 'wear and tear.' Tenant damage can cause a significant blow to any landlord's financial situation -especially if you're unprepared.
Solution: Check in frequently to prevent accumulated damage from getting out of hand. Routine inspections will allow you to spot potential problems before they become worse. Look for tell-tale signs of potential issues such as garbage piled high, damage to walls, or an unkempt exterior. Some landlords find it helpful to implement a "no pets" policy to avoid potential pet damage, but oftentimes, some of the worst damage isn't caused by the four-legged friends. To combat the financial expense of tenant damage, consider collecting a significantly higher security deposit upfront. Just remember to check your state regulations to see if there's a limit to how much you can charge for a security deposit.
Issue #5: Repairs Issues at the Rental
At some point, something will break or go wrong with the rental. For landlords, knowing when to make the repair yourself, and when to call in the professionals can help to save you time, money, and a world of frustration.
Solution: Before attempting any repairs on your own, you'll want to ask yourself three questions:
- Can I do it? If so, do I want to do it?
- Is it more economical to have someone else do it for me?
- Is it an emergency?
For instance, if your property is located a good distance away, it may not worth it for you to drive all the way over every time something goes wrong. If it's an emergency, such as a burst pipe, you'll almost certainly want to call a contractor who can get to it sooner, to resolve the issue right away -saving you from the expense of additional water damage. Then, of course, there's also the issue of safety -some repairs are always best left to the professionals.
Issue #6: No Time
As a landlord, you're responsible for overseeing everything pertaining to your rental -including the day-to-day issues, maintenance and repairs, tenant screening, rent collection, and evictions, as well as the business side of property management. It's no wonder that many professional landlords work most weekends!
Solution: Short on time? You're not alone. Being a professional landlord is a full-time job. If you have multiple properties this is especially true. To prevent property management from taking over your life, it's important to set apart specific business hours where you handle your landlord-related responsibilities. You'll also want to ensure that you're taking full advantage of the many tools that are available for landlords today. For instance, options like Rentalutions can help you with advertising vacancies -while e-signature apps like SignNow make it easy for tenants to sign documents -via tablet. If you find that you're still crunched for time, you may want to consider hiring a property management company to shoulder some of the responsibilities and to free you up from spending all of your free time chasing down rent and doing maintenance at the rental.
Finding success as a landlord isn't about finding ways to do it all alone, it's about finding the best ways to get things done. Look out for tools that can help you with rental home property management, and consider outsourcing the tasks that you find the most time-consuming. Focusing on the business side of property management, and outsourcing the extra work can help to free you up, make you more efficient, and allow you to focus your time on other projects -and maybe, just maybe, even let you take a weekend off.
Good luck and happy landlording!
Looking for help managing your rental properties? Reach out to a Renters Warehouse professional landlord today to see how easy it can be to own rental property.