The idea of putting your property to work for you is certainly an attractive one. Being a landlord, however, is a serious undertaking, equivalent to running a business. As with any business, before start-up, you need to understand your strengths and weaknesses and if it is something you can do on your own. It is not as easy as some make it sound … run an ad, get a great tenant, collect a monthly check … simple, right? Well, not so fast. The role of being a landlord comes with many financial, legal, and ethical obligations. At North County Property Group, we consult with many prospective clients who are considering renting their home on their own and then self-managing the property. We always encourage them to ask themselves the following questions before embarking on becoming a landlord:
1. Am I ready to share my home with another person or does that feel strange?
2. Am I prepared to view my home as a business or am I too emotional about all the great times spent at the home with family?
3. Am I “Internet savvy” and do I have the photographic, writing, and communications skills required in listing the property on various websites?
4. Am I available to take calls and respond quickly to inquiries from prospective tenants?
5. Do I live near the rental property and am I available to visit the home when it is required?
6. Can I be on call 24/7/365 to respond to tenant complaints, maintenance request and emergencies?
7. Am I ready to accept the financial risks associated with being a landlord?
8. Do I have the time to handle tenant interactions, arrange vendors for repairs, and handle all the other details involved in running a rental property successfully?
9. Am I level headed and can I remain calm and reasonable when conflict resolution is required?
10. Will I be able to be firm with a tenant when necessary or am I too much of a “pushover”?
11. Can I afford the cash flow related to the property during times of vacancy or if the tenant is late in paying rent?
12. Am I willing to invest money in the rental property to keep it legally compliant and “habitable”?
13. Do I have the bookkeeping skills to maintain detailed and accurate income/expense records related to the rental property?
14. What if I get audited? Do I have the organizational skills required to supply an auditor with the financial records pertaining to my tax return?
15. Am I willing to study community, city, state, and federal ordinances and laws pertaining to landlord law? Do I have a way of staying up to date and in compliance on ordinances and laws?
Did you answer “no” to any of the above questions or maybe you are not sure? Don’t worry, most people get a bit nervous when reviewing the list. But if you are not completely confident in handling all of these items properly, then perhaps it is a good idea to consider hiring a property management company. Property management companies, like North County Property Group, have skilled teams of professionals who are specialists in handling all the nuances of renting your property and managing it properly. We would love to meet with you, provide you with a free rental estimate, and review everything we would do to find you a great tenant and manage your property!