When you’re renting out a house for the first time, it’s easy to make mistakes and run into unexpected situations. Certain mistakes are more costly than others, so make sure you avoid these 5 errors, and if you get into trouble, consult with a professional Long Beach Property manager right away.
Overpricing Your Property
Every landlord wants to earn as much on a rental property as possible. However, you can actually lose money by overpricing your property. Tenants are pretty smart about the market, and they know what they should be paying for a home. If you overprice your property, good tenants won’t bother looking at it, and you’ll be left with a vacant property, which doesn’t earn any income. The goal is to get a good tenant in place quickly so you can start collecting rent checks. Don’t let your property sit vacant on the market just because you have a certain idea of how much it should bring in every month.
Inadequate Tenant Screening
When you’re renting out your home to tenants, you have to make sure you know exactly who is moving into your property. Your application process needs to be consistent and fair. Document the process so you don’t get into fair housing trouble. When you have an application, screen it carefully. Look at credit and employment information, and verify the amount of income that your potential tenants earn. You’re looking for a person with a record of paying bills and earning at least three times the monthly rent. Then, talk to former landlords. Ask if rent was paid on time, if any property damage was left behind, and if they’d rent to that person again. Not screening is a mistake, and it could result in a terrible tenant.
No Move-In Inspection
Before your tenant moves in, conduct an inspection of the property and document its condition with photos, descriptions, and videos. This will help you at the end of the lease term, when your tenant is moving out and you’re checking for damage to the property. If you don’t document the condition at move in, you’ll have a hard time withholding anything from the security deposit to pay for tenant damage.
Having no lease or a weak lease is a common mistake that first time landlords often make. You need to make sure you have a lease that’s specific to the state of California, and it needs to be an updated lease that reflects all of the requirements of the landlord tenant laws. You can obtain a lease from the California Association of Realtors (CAR) or a good property management company.
Don’t ignore maintenance requests from your tenant. There may be some cosmetic things that you’re not in a hurry to take care of, but anything that affects the safety or habitability of the home needs to be addressed right away. Taking care of maintenance is not only the right way to treat your tenants, it also preserves the condition of your investment. Put a system in place for how maintenance should be reported and a timetable for completing what needs to be done. Always respond to emergency issues right away.
These are just five of the most common errors that new landlords are prone to making. If you need help avoiding these mistakes or you’d like to talk about Long Beach property management, please don’t hesitate to contact us at CMC Realty & Property Management.