Becoming a landlord can be a lucrative business or a mad nightmare, depending on whether you treat your property investment as a business and make smart choices or treat it as a hobby. A big part of having real estate investments that are profitable, is ensuring you have quality tenants.
- Be diligent about maintenance. If you want quality tenants, you have to be a quality landlord. Tenancy is a two way street and if you want your tenants to be good to you and your property, you need to reciprocate. That means being proactive about the upkeep of your property and responding to issues quickly when they come up. If you get that toilet or the air conditioning fixed quickly, not only will your tenants appreciate it and will be more likely to treat you right and become loyal and longer term tenants, but your property will thank you too; by taking care of small repairs quickly, you avoid them becoming bigger issues too.
- Screen your tenants. Getting background data from criminal databases, credit records, sex offender registries, and current and past employers and landlords can give you a pretty accurate idea of how a potential tenant would behave when it comes to making timely payments and the way in which they’ll treat your property.
- Crunch the numbers. Owning a property for rent is an investment, and as such, it needs to make financial sense. Are you looking to make a profit in the long run and rely on appreciation, or are you looking to make some cash flow? Set clear financial goals and keep the bottom line in mind. As for the top line, make sure you research the market and set the price competitively. Too high and your property will sit vacant, too low and you’ll be sacrificing profit.
- Hire professional help. A Realtor with experience in your area can help you determine the right market value for your property and help you find a tenant quicker than you would on your own. Don’t go at it alone.
- Take location into consideration. When looking for properties to buy and rent out, finding a location that is in demand can significantly impact your success. Locations that are close to transportation, shopping, dining, colleges and universities, and/or places of work can help draw large groups of potential tenants.