While self-managing your rental property can seem like a way to save money, unforeseen challenges can arise. Here are 5 common mistakes landlords make when going the DIY route:
Skimping on Tenant Screening
A bad tenant can be a costly headache. Landlords who skip thorough background checks, reference verifications, or employment confirmations risk rent arrears, property damage, or even legal issues.
Unfamiliarity with Rental Tenancy Laws
Regulations regarding tenant rights, bonds, and eviction procedures vary by state/territory. Unaware landlords may unintentionally violate these laws, leading to fines or legal trouble.
Emotional Decision-Making
Dealing with repairs, late rent, or tenant complaints can be stressful. Landlords who make decisions based on emotions rather than logic may end up compromising on rent negotiations or neglecting to enforce lease agreements.
Underestimating the Time Commitment
Being a self-managing landlord is a time-consuming job. Tasks like
- property maintenance,
- advertising vacancies,
- responding to tenant inquiries, and
- rent collection can quickly eat away at your free time.
Neglecting Recordkeeping
Detailed records are essential for tax purposes and potential legal disputes. Landlords who fail to keep meticulous records of income, expenses, lease agreements, and maintenance receipts may face financial difficulties or legal challenges down the line.
By avoiding these mistakes, you can ensure a smoother and more successful experience as a self-managing landlord. However, remember that property managers can offer valuable expertise, tenant screening, legal compliance guidance, and time-saving solutions. Weigh the pros and cons carefully to decide if self-management is the right choice for you. Contact your local friendly property manager for more information.
