If you have spent some time in the rental real estate sphere, you know that things can get complicated quickly. What could appear to be a small mistake can lead to larger financial losses, legal issues, or a damaged reputation. It's essential that property owners understand the most common mistakes that landlords make so that they can take steps to avoid them. Below we share the top mistakes to avoid making as a self-managing landlord, and how to best protect your property.
Not Screening Tenants Thoroughly
Not thoroughly screening tenants can result in serious, costly issues down the road. Not conducting a thorough background check, credit check, and employment verification can lead to renting to a tenant who may have some avoidable concerns. Not vetting tenants well prior to move-in can result in late rental payments or nonpayment of rent, property damage, and legal problems. We recommend always thoroughly screening tenants, and making sure to verify the information they provide you with.
Hiring a reputable property management company can significantly reduce the likelihood of these issues occurring. At Rincon Property Management, we utilize the latest technology to verify bank statements and other information provided by the tenant. Property management companies not only have the time to look into each piece of information, but they will have access to the proper tools.
Not Properly Maintaining the Property
Neglecting regular maintenance, inspections and repairs can result in the maintenance issues growing into larger, more costly problems. Failing to maintain the property can also result in safety hazards and health violations. We recommend regularly inspecting your rental property and to address any issues as soon as they arise.
Not Having a Written Lease Agreement
Not having a written lease agreement is another mistake that landlords make. A written lease agreement protects both the landlord and the tenant by clearly defining the terms and conditions of the rental agreement. This includes rent payment, property maintenance responsibilities, and the length of the tenancy. Without a written lease agreement, disputes can arise and can be difficult to resolve. To avoid this mistake, always have a written lease agreement in place and ensure that both the landlord and the tenant understand the terms and conditions.
Not Staying Up-to-Date on Landlord-Tenant Laws
Staying up-to-date on landlord-tenant laws is essential for landlords. Failure to comply with state and local laws can result in legal problems and financial losses. This can include issues related to rent control, security deposit regulations, and eviction procedures. Make sure to educate yourself on the latest landlord-tenant laws and seek the guidance of a professional if necessary.
Property management companies regularly utilize the help of legal professionals, as this is always in the best interest of the property owner, and the rental property.
Not Properly Handling Security Deposits
Not properly handling security deposits is another common mistake that landlords make. This can include failing to return the security deposit in a timely manner, improperly deducting funds from the deposit, or not following state and local laws regarding the handling of security deposits. To avoid this mistake, always follow state and local laws regarding the handling of security deposits, provide a written itemization of any deductions, and return the security deposit in a timely manner.
Not Properly Evicting Tenants
Finally, not properly evicting tenants is another mistake that landlords make. Improperly evicting tenants can result in legal problems and financial losses. This can include failure to follow state and local eviction procedures, failure to provide proper notice, and failure to provide a valid reason for the eviction.
Avoiding these mistakes can prevent the most common issues impacting landlords. Thoroughly screening tenants, properly maintaining the property, having a written lease agreement, staying up-to-date on landlord-tenant laws, properly handling security deposits, and properly evicting tenants are all important steps in protecting your rental property.