Being a landlord is no small matter. If you have never owned a rental property, then you have a lot to learn. Your responsibilities go much further than simply purchasing and leasing out a home. You have to think like a business person and not just a property owner.
As a landlord, your ultimate goal is to make a profit by leasing your property. If you are not maximizing your property, then you are cheating yourself. You’re renting out your property for a hobby rather than a business endeavor. To maximize off of your investment, you’ll need to make a few upgrades to the property, screen tenants thoroughly, and seek opportunities to capitalize off of excess land. While there is some nuance to managing land, if you can stick to a few rules of thumb, you can avoid mistakes that have befallen landlords’ past.
Make needed upgrades to your property
Unless you are renting out a brand-new property, chances are your house isn’t ready for tenants. The fact of the matter is that purchasing the property is just the first of many investments you’ll need to put into it. You want prospective tenants to be wowed when they show up in search of a place to settle down. You’re leasing, not selling. You won’t be able to get tenants to bite on the idea of a “fixer-upper.”
If you’re doing renovations on a budget, then handle the essentials first and work your way out from there. Your main priority needs to be making sure that the structure, plumbing, and electrical wiring are up to par. If no major repairs are needed, then you may be able to find a local handyman who can fix all of those issues.
Once the functional concerns have been mitigated, it’s time to focus on the things that capture tenants’ hearts. The main three areas of concern are the kitchen, living room, and (of course!) the master bedroom. You don’t have to break the budget or go over the top on these areas, but you want to modernize them as much as you can on your budget. Small things–like granite countertops and an island in the kitchen, or a fireplace in the living room–add hundreds to your home’s value.
Screen your tenants thoroughly
If you are ready to lease out a property, then the chances are that you have rented from someone else before. Whether it was a house or an apartment, surely you can recall that there were certain hoops that you had to jump through to prove your trustworthiness. You don’t want to learn the hard way that your previous landlord was right to give you a hard time.
No matter how great an impression they make on you when you meet them, you need to screen prospective tenants thoroughly. Don’t make an emotion-based decision about who to rent to; make an informed one. There is software available where landlords can get a free online rental application, credit reports, and background checks. Don’t just utilize these tools, believe what they tell you about the applicant(s) that you are considering.
Maximize on excess land
If you own your own property, then you can get creative in conjuring up ways to make your land even more profitable. Don’t get stuck in the mold of simply renting out your home! If you have excess land, there are various ways to turn the portions of your property that you don’t use into some serious coin.
One simple way to monetize your extra land is to plant a small organic garden on it. Grocery stores and farm-to-plate restaurants need a constant influx of fresh, locally sourced fruits and vegetables. If you grow it, they will buy. People are becoming more health conscious and selective about the foods they eat. Restaurants and grocery stores are capitalizing off of this trend, and you can too!