There are quite a few perks to being a landlord in Winter Park: the income is excellent, the tax breaks are plentiful, and there’s no better feeling than being your own boss. While these are all great reasons to become a landlord, many people only look at the positive aspects and overlook the pitfalls that can come with such a position. To be prepared for the good and the bad, let’s take a look at some common issues landlords typically run into.
1. Not Knowing How Much to Charge for Rent
While there are many reasons to get into the property rental industry, most would agree that making money is at (or near) the top of their list. Once you decide to rent your property, the question becomes: how much should you charge your tenant? Charge too much, and you run the risk of not finding anyone willing to rent from you. Charge too little, and you won't make any money.
Conducting a market analysis is a good way to determine what your rate should be. You'll want to look at things like:
- How many other rental properties are in your area?
- What are those other properties charging for their rentals?
- What do similar properties in your area charge?
- What amenities do those local properties provide for their tenants?
At Verandah Property Management, we take pride in knowing the ins and outs of the Winter Park rental market and can steer you in the right direction when it comes to your rental rates.
2. "Today's Leaky Faucet is Tomorrow's Flooded Basement."
How many landlords does it take to screw in a light bulb? Probably just one—but the same can't be said for replacing a light fixture, or an entire wall that light fixture is attached to. Maintaining your property is an essential aspect of renting, but sometimes the cost can be overlooked.
There will be some maintenance issues you'll be able to handle yourself; inevitably, something will come up that will require outside help, which means you'll need to spend some money. It's a good idea to set aside a nest egg for those big fixes that might arise. Performing a routine maintenance check every few months is a great way to stay on top of any issues that you might run into as well and keep them from becoming significant headaches down the road.
Additionally, having open and honest communication with the tenant is critical, as they’re usually going to be the first ones to notice any issues that occur. Address maintenance requests from your tenant promptly, and they’ll be more likely to trust you with those kinds of issues in the future; ignoring them outright might make the tenant feel less inclined to inform you of new red flags.
Having a capable crew to handle both regular and emergency maintenance is of extreme importance; if you find yourself struggling to keep your maintenance costs down or find qualified specialists for your Winter Park rental, then partnering with a property manager may be your best solution!
3. Not Understanding Landlord-Tenant Laws
There are many laws, both at the state and federal level, that are in place to protect both sides of a rental agreement; everything from the collection and storage of security deposits, to maintenance responsibilities and procedures for eviction.
Specifically, you’ll want to familiarize yourself with the Fair Housing Act, which prohibits discrimination based on factors like race, religion, and sex. The Fair Credit Reporting Act, which dictates how a landlord may use a tenant’s credit history for screening purposes, is another piece of federal legislation that landlords must comply with. Running afoul of these laws can lead to quite a bit of legal trouble if you’re not careful, typically resulting in hefty fines if a landlord is found in violation.
If you’re worried your Do-It-Yourself approach is putting you at risk, our team at Verandah Property Management can put you at ease: our staff has extensive knowledge of both federal and local laws. We're here to keep your reputation intact!
4. Improperly Screening Your Tenants
So, you’ve figured out what to charge for rent, your space is in tip-top shape, and you feel like you’ve practically earned a law degree with everything there is to know about landlord-tenant laws: finally, you’re ready to find the right tenant. To do this, you’ll want to make sure you thoroughly screen each potential candidate or run this risk of renting to someone you’ll end up having to evict later.
Start with some general questions about prior rental history, current monthly income, and when they intend to move in. You’ll also want to ask them for previous rental history and current proof of income as well as have them submit to a background and credit check. The goal here is to learn some necessary background information and spot any red flags: if a potential tenant has a history of past evictions, it’s probably best to look at other candidates to fill your vacancy. You don’t want to have to evict someone as the process can take months and result in lost rent and vacancy costs.
The screening process can be arduous, so if you feel you’re not up to the task, Verandah Property Management has you covered with time-tested pre-screening techniques.
Being a landlord can be rewarding, but it’s even more so when done the right way. Partnering with Verandah Property Management can help you make the right decisions every time, so contact us today and see how we can keep your investment on the right track!