It’s a fairly well-established fact that property is by far one of the most reliable and lucrative forms of investment that you can make. Unlike many other types of investment, property is one that, if you are smart, is almost always guaranteed to get you a return on your money. The issue with this is that it means that a lot of people tend to assume that investing in real-estate and becoming a landlord is somehow easy, or doesn’t require much work. They have a rose-tinted image of buying up properties, occupying them with tenants, and then just sitting back and watching the cash roll in. It’s certainly a nice idea, but it’s hardly realistic. Of course, property can be extremely lucrative, but that doesn’t mean that it’s an easy way to get rich quick. In fact, there are a lot of things that go into being a landlord that the vast majority of people either forget about or never realize in the first place. One of the things that people tend to fail to understand is just how competitive the world of real-estate investment can be. This isn’t just a matter of different people wanting to invest in the same properties; it extends to every single aspect of the business as a whole. If you want to be a successful landlord then you have no choice but to work hard to stay ahead of your competition. While this isn’t necessarily going to be easy, there are things that you can do to maximize the edge that you have over your competition. Here are just a few ways that you can make sure that you achieve the maximum amount of success as a landlord and get the most out of your investments.
Choose your properties carefully
Your career as a landlord is always going to be inextricably tied up with your properties. This means that you simply cannot afford to take a cavalier approach to which properties you choose to invest in. Far too many landlords, who otherwise were engaging in perfectly sound business practice, find themselves getting caught up because they put their money in the wrong place. One of the most important things to remember is this: the cost of a property goes beyond your initial investment. A lot of landlords, especially those who are first starting out, assume that the best thing to do is to get the best possible deal on a property. Of course, the cost of the property and the initial investment that you’re making is going to make a lot of difference, but it’s not everything. There are plenty of other factors to consider. For one, you have to ask yourself, “why is this property so cheap?” This could be because of a whole host of reasons, ranging from the area that the property is in, to the condition of the property itself. You need to weigh these things against the investment that you’re making. If the property is in a low-income area, then you’re not going to be able to charge higher rates of rent. This is fine if the property doesn’t require much maintenance, but if it’s in poor condition, then you’re going to end up spending large amounts of money on repairs which then won’t be covered by the low rate of rent that you have to charge. On the other hand, a more expensive property might seem like it’s a far more costly proposition but if it requires less work to bring up to the correct standards and you will be able to charge a higher rate of rent to cover any extra costs then it could turn out to be a much better investment overall. These might be two extreme examples, but they should give you an idea of just how selective you need to be with your properties. Work out what you need from them and what level of work and maintenance you’re willing and able to do. Then you should always balance that against the rates of rent as well as the initial investment. Short-term thinking is one of the most dangerous things that any real-estate investor can do.
Figure out how to market your property
Marketing your property is something that far too many landlords completely neglect and often don’t even really think about. This is even more bizarre considering just how important it really is. Landlords often assume that as soon as their property is on the market, then the perfect tenants will just come along. No, there’s nothing to say that that couldn’t ever happen, it’s just pretty unlikely. Instead, you need to make sure that you’re putting your property into places where prospective tenants will be able to find it, and you also need to make sure that you’re putting in the sorts of places that will attract the kinds tenants that you want. This means that you’ll want to choose the agent that you lease your property through pretty carefully. Look at the kinds of properties that they usually deal with so that you can figure out if your property is a good fit for them. It’s also very important to think about marketing your property as something that requires a lot of work. Just putting the property into places where people will find out about it isn’t enough. You need to make sure that the information about the property makes it as attractive to tenants as possible as well as being sure that it is extremely well presented. Ensure that any pictures of the property are high quality and show the best elements of each room. There should be no clutter in any of the images, preferably just showing the property in the exact condition tenants will be moving into. It’s also a good idea to contact companies who specialize in helping you lease out your properties and over things like 3d renderings which can offer potential tenants a much better idea of the property and makes them far more likely to be interested in it.
Be picky with your tenants
If there’s one thing that a lot of first-time landlords discover very quickly, it’s this simple fact: not all tenants are created equal. The tenant that you lease your property out to can make all the difference in just how pleasant or simple your experience as a landlord can be. The right tenant can be a total dream. They pay the rent on time; they are responsible for the property, and they let you know about any issues in a timely fashion. You will, undoubtedly, still have to deal with the paperwork, cost, and maintenance on the property, but you’re not going to have to spend all of your time dealing with one problem after another. On the opposite end of the spectrum, the wrong tenant can turn your life into a waking nightmare. You may find yourself chasing rent month after month as they dodge your calls and come up with one excuse after another. Not only that but bad tenants could well cause more problems with the property itself as well. If the property isn’t being treated well, then it’s going to start to have more problems. Not only is this going to make your life more difficult as you try to arrange frequent maintenance and repairs, but it will make renting out the property to any future tenants incredibly difficult. The best thing that you can do is to screen your tenants very carefully. Whichever agent you’re leasing the property through will often help with this. It’s a good idea to interview, or have your agent interview, each tenant when they first view the property to get a good idea of the kind of person that they are. It’s important that you are comfortable with the kinds of people who will be occupying your property. It’s also very important to be a little bit cynical when it comes to your tenants. This might sound a little bit odd, but you shouldn’t take anyone at their word. After all, if someone wants to rent your property, then they’re obviously going to be putting their very best foot forward no matter what. You should make sure to contact their previous landlord to find out what kind of tenant they were. Did they pay the rent on time? Did they take care of the property? Were there any problems with their behavior? These are all crucial questions that you’ll want the answers to before you sign any paperwork. This might seem a bit harsh, but this is your property, you’ve put a great deal of money as well as emotional investment into it. And when it comes to your investment, there really is no such thing as being too careful.
