If you’re a new rental property owner, things can seem pretty overwhelming at the beginning. From screening prospective tenants to insurance policies to the rules of your homeowners association or HOA managers, there’s a lot to juggle and remember.
The most useful tip for a new landlord is to get organized from the start. These beginning steps can have a big impact on your chances for rental property success:
Learn the Laws of Your State
Set aside time to study your state’s laws regarding tenant-landlord relations and what is allowed versus what isn’t. This will prevent you from accidentally overstepping some boundaries of regulations you weren’t aware of otherwise.
And remember that you will likely have separate city and state laws to know besides federal laws that apply to everyone.
Examine the Property
You probably had an inspection done when you first bought the rental property. However, now it’s time to really examine it as if you were a tenant yourself. Are there any updates that need to be made for attracting and keeping quality tenants long term? Does anything need to be replaced, such as carpeting or appliances? What about the exterior?
Make Sure You’re Covered
Make sure you get insurance right away if you didn’t include it in your purchase. Insurance is crucial to protecting your investment in the case of damage. And get liability coverage in the case of damage or injuries to guests or tenants on your property.
If you obtained a policy when purchasing the property, take time to review it and be sure it’s correct for your situation.
Meet Current Tenants
If the rental property you purchased already has tenants living there, introduce yourself and ensure they understand how best to contact you. And make it a priority to tell them about any changes you plan to make soon. Some people are intimidated by having a landlord (and can also cause them to move), so try to make the process enjoyable for everyone.
Set a Payment and Maintenance Plan
From the beginning, you’ll want to set up systems for maintenance and payment. Will you handle maintenance issues yourself or hire someone to do it? Make a list of companies to call for plumbing, heating and cooling, electrical problems, and more.
Also, set up a payment system that is conducive to both you and your tenants. If you own or plan to own several rental properties, you’ll need an accountant for dealing with finances. You might also consider working with a management company for managing payments, late notices, and other duties.