You have a dream, some savings, and a determination to buy a property and become a landlord. Now it’s time to take the big leap and get started!
However, before you become a landlord, there are a few things you need to keep in mind. Plus you’ll need to meet a few requirements to become a landlord so that you can launch your new business.
So, if you’re ready to take the plunge and start renting property, you should be aware of a few important details. Let’s take a look at five things to consider if you’re thinking of becoming a landlord for the first time.
1. Get Renters Insurance
Applying for renters insurance is a key consideration for new landlords.
Why? Because renters insurance will provide basic protection for both you and your tenants if a negative event (such as a flood or fire) arises.
Even though this is voluntary insurance, we still recommend getting it. After all, it’s better safe than sorry!
2. Take Out Commercial Landlord Insurance
Renters insurance isn’t the only type of insurance you should have. You should also get landlord insurance.
Landlord insurance is generally required by law, although this can vary depending on where you live. The insurance policy mainly provides protection from damage to your buildings’ structures.
3. Create Written Rental Agreements
When you’re just getting started with property leasing it can be tempting to simply use word-of-mouth contracts or to rent to friends and family on a good-faith basis. This, however, is a mistake.
It’s always a good idea to have a written document. This serves as a legal agreement between the owner of the property and the tenant, establishing a formal and friendly agreement through rules, processes, and indications of mutual compliance.
Having that rental agreement in place is important in case anything goes awry. With the agreement, you’ll be able to easily settle disputes by referring back to the contract.
Pro Tip: pay attention to the details. The more clearly you establish the benefits and rules between you and your tenant, the easier it is to avoid problems in the future.
4. Consider Finding Tenants Online
In this digital age (and as a first-time landlord) it’s not a bad idea to look for future tenants online.
One easy way to connect with tenants virtually is to create a secure website. Then, display the most relevant and eye-catching features of your property. This will attract the attention of potential tenants and generate interest in your property.
Additionally, your website can provide you with a safe way to contact people. If you add a contact form to your site, you can connect with tenants safely and privately.
5. Keep Good Records
Probably the most crucial of our first-time landlord tips is to keep good records. You need to keep payment records, both those made by you for things like maintenance and insurance, and those made by your tenants.
It doesn’t matter whether you keep them digitally or physically. However, it does matter that you have the records on hand.
These will serve as evidence in the event of a claim of any kind. They also serve as a way of making sure that you’re managing your finances and maximizing your overall ROI.
Start Your Journey to Becoming a Landlord
Becoming a landlord is a fantastic goal. And, with these tips in mind, you’re likely to be able to do so with little hassle and trouble!
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