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To Rent or Not To Rent

Are You Cut Out To Be a Landlord?

Before you dive into renting out your property, it’s worth investigating what’s involved with being a landlord and what skill sets and temperament you need to be successful at it. Here is our short list of the seven skills and traits you need to be a landlord.

1. You Don’t React Emotionally

You can’t take things personally as a landlord. If the tenant mistreats your place or is late with the rent, you have to remove the emotion from the relationship and treat it as a business transaction. Emotionally detaching is difficult when you have an attachment to the property you are renting out. For example, if you are renting out the house you grew up in, are you going to feel personally violated if the tenant pulls a cabinet down? Similarly, if the tenant can’t pay the rent are you going to be rational or emotional in your response to this?

2. You Are Decisive

There are times when you need to make decisions quickly and take decisive action as a landlord. For example, a storm knocks a tree into your property. You don’t have time to mull over all your options for a few days. You have to take immediate action to make sure the tenants are safe, and the property is protected. If you are someone who doesn’t like taking fast action, this may not be the right role for you.

3. You Are Patient

When you have a good tenant, or there is a line of potential renters vying for your vacancy, life as a landlord is good. But when the market turns and your place has been vacant for a month, are you going to be patient enough to wait for the right tenant or are you going to react fearfully (see #1) and take a tenant whom you wouldn’t normally accept? Renting your property is a long-term investment strategy. It’s often not a short-term money-making venture.

4. You Communicate Often and Well

As a landlord, consistent and clear communication with your tenants is critical to protecting your property and keeping your tenants happy. You have to respond to tenant inquiries and issues promptly as well as assertively communicate your rental policies. If you don’t like having difficult conversations or being tied to your phone and email, being a landlord may not be for you.

5. You Can Handle Home Repairs and Maintenance

No matter how renter-ready your place is, there is always some maintenance to be done. (Read What Maintenance Am I Responsible For as a Landlord? to learn more.) The toilet overflows, a window cracks, the locks stick—any number of things routinely go wrong. You will have to not only take the phone call from the tenant at 2 am (because toilets never seem to get clogged during office hours), but you will also have to be on site to fix the problem.

If you have a flexible schedule and you’re handy, this may not be an issue at all. However, if your hours are limited and/or you aren’t mechanically inclined, you will need contractors on call to help you. (Read How to Find a Reliable Contractor) You will then just need to coordinate the work and make sure you or the tenant are available to let them into the property.

You can also hire a property management company to handle day-to-day maintenance on your property, which eliminates this concern for you. Read our article on the Top 10 Questions to ask a Property Management Company before you shop for a property management company.

6. You Are Organized and Keep Good Records

Being a landlord means you are running a business. You’ll need to keep detailed records of your expenses and income because you will have to file business income taxes. Getting a good tax accountant will help a lot, but if you’re not keeping good records, to begin with, the accountant won’t be able to help you much.

7. You Can Put Time Into Learning New Things

As a landlord, you will need to know some real estate law and landlord laws. You’ll have to learn about neighborhood zoning, property and business income taxes, eviction processes, and tenant rights. There will likely be a learning curve on repairing home systems like plumbing and electrical. If you either are already well versed in these areas, or you love learning new things, then you’re a good fit for being a landlord.

What To Do If This List Doesn’t Describe You

If you are only comfortable with a few things on this list, you may want to get a property management company to do the things you’re not good at. For example, if you can’t see yourself screening tenants and showing the property, you can get a property management company to handle tenant placement. If that part seems fine to you but maintaining the property seems daunting, you can get a property management firm to handle just that portion of the process. And if all seven things are outside your comfort zone, you can hire a property management firm to do all of it. (Read What Does A Property Manager Do? and How Much Does Professional Property Management Cost? Is It Worth It? for more information.)

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