We all want to see a profitable return on our investment of time and money. Success as a landlord requires both of these resources—and it’s important to know what to do to gain that success, given the costs.
An essential aspect of this is knowing what not to do. Many landlords in Arlington succumb to the pitfalls of the business because they are not adequately prepared. Below we have put together five common mistakes that landlords make, costing them precious time and money.
What Are the Top Five Mistakes Landlords Should Avoid?
1. Not Studying the Market
So many landlords have an expected price in their head for rent without looking into the local market. This is one of the biggest mistakes a new landlord can make.
- Look into what other comparable properties (comps) are renting for, and begin considering your rental price based on those properties.
- Next, consider which properties are currently rented out and which are vacant.
If there are a lot of active listings in an area, then potential tenants have many options to explore when choosing their new home. Price your investment property accordingly to be sure that you will turn a profit.
2. Ignoring or Improperly Performing Maintenance
Maintenance is a huge issue when renting out a property: tenants expect any problems to be dealt with promptly. Your investment property is their home—and they want it to function correctly. Ignoring property maintenance makes tenants unhappy, and unhappy tenants are liable to leave—or withhold rent.
Even if your tenants don’t cause any trouble over slow maintenance, remember: the longer you let a problem go, the worse it gets. Ignoring maintenance can end up costing you more in the long run.
Any maintenance carried out on your Arlington investment property should be handled professionally. You may be handy with basic household maintenance—but don’t try to work on something out of your depth. There’s a time for YouTube DIY and a time to call in the professionals.
Most of us are not experienced in working on an air conditioner, for example—so we have someone else do it for us. Call a professional and have it done right: your tenants will appreciate the quick turnaround, and your property will be in the right hands.
3. Not Performing Background Checks
It can be tempting for landlords to accept the first applicant who is able to pay the security deposit and rent in order to minimize vacancy costs—but this is not the ideal route when renting your investment property. Knowing who you are renting to is an essential aspect of being a landlord: the wrong person can end up costing you money instead of making you money.
Who you rent to is one of the most critical factors in being a landlord. Tenants are in your property more than you are; a thorough screening is your first safeguard in protecting your investment.
A “professional tenant” who slips into your property can cost you thousands. Don’t let that happen: perform background checks on every tenant. Your screening process takes a minimal amount of time and money compared to future heartache; when you screen every tenant, you also reduce the impression of bias.
4. Underestimating Expenses
They say, “It takes money to make money.” This is absolutely true of the rental property business: landlords who don’t understand the financial cost of what they are getting into are likely to fail. You’ve already invested in purchasing the property; you need to set money aside to maintain it properly.
Several reasons to set money aside are:
- Unexpected repairs such as plumbing or air conditioning failures
- Maintenance services such as pest control or lawn care—should you provide them
- Unforeseen legal expenses, such as tenant eviction
- Paying for background checks on new tenants.
Planning for these expenses is crucial to your success as a landlord. Being unprepared for the unexpected is a common mistake that new landlords make: be sure to set funds aside for the rainy days so you won’t be left unprepared.
5. Not Hiring a Property Manager
Hiring an expert property manager in Northern Virginia can ease the burdens of the day-to-day tasks involved in renting out investment properties. A property manager will also know:
- The appropriate rental rate
- How to safely find tenants
- The best way to handle maintenance and so much more.
If you are at all hesitant about any aspect of being a landlord, protecting your investment property with expert property management company may be right for you.
Trusting your investment with someone else is a big deal! At RentSimple, we’re here to ease your mind and take care of all of the work involved in being a landlord. Your Arlington investment property is safe in our hands—and you can rest easy knowing that professionals are looking after your investment. Get in touch with us today; see for yourself why so many landlords trust RentSimple!