Renting your property can be a challenging task. From finding the right tenants to ensuring that your property is in good condition, the responsibilities of a landlord never seem to cease. If you’re someone who is thinking of renting your first investment property out and are feeling overwhelmed by the task ahead of you, this is definitely an article you want to tune in to. Today, we have a look at 6 tips for taking care of your rental property as a landlord, so read on to find out more!
Figure Out Your Tax Depreciation Schedule
If you’re new to the game, chances are you are scratching your head about this one. In a nutshell, a tax depreciation schedule is a document that tells your accountant how much depreciation to claim on your investment property. This depreciation can be calculated in the form of wear and tear that naturally occurs over the years, especially if you throw tenants into the mix. Figuring out your own tax deprivation schedule is important and always advised as they are tax deductible and typically provide an excellent return on your investment.
Formulate Your Preventive Property Management Schedule
“Prevention is better than cure” is a phrase that is applicable to many situations including property management. As you probably already know, being a landlord comes with its fair share of responsibilities, one of which includes ensuring that your property is well maintained and in habitable condition. By formulating your preventive property management schedule, it will be easier for you to nip problems in the bud rather than waiting for them to result in costly maintenance repairs.
It is important to include a clause in your lease that requires your tenants to notify you of any maintenance issues in a timely manner. It is also advised that you inspect the property a few times a year to check on its condition.
Consider Hiring A Property Manager
If you don’t want to deal with the nitty gritty aspects of leasing your property out on your own, we highly recommend that you consider hiring a property manager. A property manager is a worthwhile investment that will save you a lot of time and effort, especially when it comes to arduous tasks such as doing background checks on potential tenants and collecting rent payments. Hiring a property manager is also very helpful if you live a far distance away from your investment property and do not have the time or resources to visit often. By putting the responsibility on a third party, you can ensure peace-of-mind that your property is being well maintained at all times.
As an overzealous first time landlord, we can understand how tempting it may be to overcharge your tenants. However, it is important that you ensure your rental income expectations are in line with the current market. It is always advised that landlords do their due diligence and avoid inflating prices, even if you have made significant improvements or renovations to your property. It is important to note that lower rent prices often result in lower vacancy rates and negative gearing can be claimed as a tax deduction against your rental income.
Landlord Insurance is A Must
Possibly one of the most important factors to take into consideration as a first time landlord is to ensure that you are adequately covered by landlord insurance. This is such an underrated yet valuable factor when it comes to property investment. Landlord insurance will be able to cover financial losses incurred by a large number of circumstances. These range from tenants who do not pay their rent, sudden death of a tenant, water damage, tenants who can’t pay rent, tenants who take flight all of a sudden and many more. In order to limit these costs and ensure that you aren’t faced with an ugly situation, purchasing landlord insurance is an absolute must.
Keep Good Relationships With Tenants
Last but not least, the best way to ensure that your property is well taken care of over a long period of time is to form a good relationship with your tenants. If you have responsible tenants who pay on time, keep the property in good condition and are amicable at all times, we highly recommend asking them to renew their lease at least 3 months prior to its expiration date. Renewals will help you avoid a vacancy and can save you an immense amount of time that would otherwise be spent vetting new tenants. A good tenant is worth their weight in gold, and if you’re lucky to have hit the tenant jackpot, it is always in your best interest to keep them!
Renting your property out as a landlord does come with its challenges, but in the end the benefits you gain from doing so far outnumber the difficulties. We hope that this article has given you some insight into how you can take care of both your investment property and your tenants. All the best!