Every day over 2600 new renters sign leases, so renting out your space if you aren't using it is a great way to earn an extra bit of money. While being a landlord doesn't sound like the hardest job, if you're an accidental landlord, there are many mistakes and pitfalls you need to be aware of.
So, keep reading to find out more about the top mistakes that accidental landlords make and how you can avoid them.
Not Securing Deposits in Time
If you're an accidental landlord, you might not know that you need to secure tenants' deposits into a tenancy deposit scheme. Depending on your state, the timeline may vary, but usually, landlords have 30 days from the moment they receive the deposit to secure it. If you fail to do so, your tenant will benefit, but you can lose big.
If the deposit isn't secured in time, the tenant can prosecute you for up to three times the deposit amount.
Underestimating the Cost of Home Repairs
Your home might be in perfect condition when you first start renting it out, but if you don't maintain the level of quality, you'll find yourself without renters quickly. One of the benefits of renting a home is that you aren't in charge of maintenance; the landlord is. So you need to make sure you charge enough rent to cover ongoing maintenance costs.
You also need to budget for larger emergency repairs. Issues like burst geysers tend to pop up at the worst possible time, so you need to make sure you have enough savings to get emergencies taken care of as quickly as possible.
Not Using a Property Management Service
One of the best accidental landlord tips you can follow is using a property management service.
Whether you have various homes for rent or a single property, property management services can help you make the most of your investment property. The service you choose will tailor their portfolio management depending on your needs.
The goal of a property management service is to make your life easier and to help your property operate smoothly.
Some services to look out for when choosing the right property management service for you:
- Online owner and tenant portal access and alerts
- Property marketing
- Leasing management
- Tenant screening, including a tenant criminal background check
- Eviction protection
- Rental property inspections
- Rental valuation
Avoid These Mistakes Accidental Landlords Make
One aspect of being a landlord is understanding the mistakes accidental landlords make and how to avoid them. If you're just getting started as an accidental landlord, there are various pitfalls you need to keep in mind, and it's incredibly easy to make these mistakes. But keep your head up and use this accidental landlord guide to help you on your journey.
If you're looking for help, you should contact Blue Ribbon Property Management today! A property management company will help you avoid these mistakes and can help with a whole range of services, including running a tenant background check and property maintenance.