Though a job of a landlord appears easy on the face of it, it is not that simple. If you lack the necessary qualities, you can land yourself in a financial mess. Enumerated below are the qualities of a landlord that can help him reach the peak of success.
Personal attributes - You should be thoroughly devoted and stay motivated even when the situations are odd. Landlords who have affinity for people and possess the tendency to deal with them in transparent, honest and respectful manner have an edge. You should keep your indignation with tenants hidden under the shroud of affable smile. Be able to control your temper and embed a sense of humour in your temperament. To be successful you will need to develop patience and communication skills while toning down your assertive and aggressive attitude. You should also be willing to discharge your duties even at odd hours with optimism and enthusiasm.
Inherent management skills - A good landlord keeps chaos from seeping in his work and knows which task should take precedence over others. His objectives are clear, stays at ease when confronted with problems, does not get disoriented due to work interruption and is capable of resuming pending jobs later on.
Realistically ascertain your limits and strengths. If you are disinclined to fix faulty home apparatus or look after accounts, you have to understand that the cost of hiring professionals may overshoot the income derived out of apartment.
You should devote quality time to scrutinize the property you are buying and screen the prospective tenant you are leasing your apartment to. Any deviation would result in acquiring a damned property or getting stuck up with deadbeat tenants. Any hasty or unwise decision will impede your earnings significantly.
Business skills - Landlord should confidently pursue disciplinary steps against errant tenants who breach contract’s provisions or fail to pay timely rent. Common sense and business acumen should reign supreme. You have to diplomatically carry out eviction if the tenant is failing in his financial obligation due to job loss. You have to exercise verbal restraint and proceed with a cool temper in every instance of handling a defaulting tenant. Professionalism and purposefulness should guide your rightful actions.
You should of your own willpower try to learn the strategies that would drive your business like advertising and promotion, accounting, bookkeeping, and the legal aspects. You should learn about the entire array of regulations having a bearing on the landlord role.
You should be assertive when it comes to timely rent collection as you too are obliged to pay property bills.
Being a handyman - It is incumbent on the landlord to personally attend to minor tasks pertaining to the physical aspects of the property. This will sustain your business as you will not be constrained to share out minor sums from your profit towards hiring professionals for attending toilet, electrical, plumbing or other such odd tasks.
You should acquire handyman skills by going through relevant portals on the internet, books, brochures or DIY flyers and seeking expert advice from friends. Observing others carry out simple tasks will also enhance your proficiency levels.
Bookkeeping - You should develop keen interest in documentation realm pertaining to bookkeeping, interest rates, filing reports, income tax return preparation, analyzing credit reports etc. Consciously steer your budget taking into account contingencies, tax submissions and spending graph.
Tenants are likely to be loyal to you for a year or so. With a succession of tenants moving in and out of your apartment, you have to keep the apartment spruced up and attend religiously to its cleaning and painting requirements.
Financial security - Analyze your finances and credit performance consciously. Set aside a considerable sum for future contingencies, evaluate your qualification to secure a short term loan, chalk out strategy to meet expenses if the apartment goes vacant for few months, and analyze your financial capability to hire someone to take care of renting related jobs.
If you believe you have the above mentioned attributes, go ahead and venture out as a landlord. Avoid the pointers below that can lead to failure and you shall surely succeed as a landlord and mint money.
Failure as a landlord is generally attributed to one of these reasons:
- Lacking the skills and aptitude required for running and managing the business
- Failing to commit attention to acquiring necessary skills prior to renting
- Failing to evaluate whether income from rent would offset the expenses
- Purchasing of property in economically non-viable area that attracts only low-income tenants
- Over-the-top spending on accessories and appliances
- Not dedicating quality time towards improvement and upkeep of property
- Eviction of tenant owing to non-payment of rent or breach of contract terms
- Monthly property cost is exceeding income due to purchase of property at inflated rates and getting burdened under high mortgage, repair and maintenance costs