Are you thinking of doing a "for rent by owner" situation? Owning and managing your residential rental property isn't always all it's cracked up to be.
Being a good landlord is a lot of hard work. Not only do you have to inspect and maintain your property on a regular basis, but you also have to find tenants, deal with their needs, and make sure you're getting rent on time.
Before you set off renting out your home, it's time to figure out if this is something you can handle. In this post, we're going to look at 5 of the biggest challenges of DIY rentals. Keep reading and you'll understand what you need to put in and what you'll get out of being a landlord.
1. Finding Great Tenants
Finding tenants might seem like one of the easier parts of being a landlord, but it really isn't. If you're going to get the best tenants in your rental, then your property needs to be in good shape and you need to stay on top of your duties as a landlord.
It's a challenge to keep good tenants around. The last thing you need is a high turnover rate with tenants, as it puts a lot of extra work on your plate. On the other hand, renting your home to less desirable tenants creates a litany of other problems.
2. Dealing With Evictions
No property owner gets into house rentals so that they can evict tenants. That said, if you don't do your due diligence during the tenant screening process, you could always end up with tenants that drive you crazy.
You can evict a tenant for a few different reasons, the most common because of constant late rent payments and delinquent behavior. It's not necessarily difficult to evict an obviously bad tenant, but it's time-consuming and creates a lot of stress.
3. Wear and Tear
No matter if you've got a great tenant in your property for years or a series of bad ones, they'll create wear and tear on your property. You can expect to pay a couple of thousand dollars every year in general maintenance on your rental.
4. Extended Vacancies
An economic downturn can have a drastic effect on the ROI of your rental property. If your property ends up being in a less desirable area, then you're going to have extended vacancies. This means you'll be paying your own mortgage, plus the cost of the rental property.
Economic issues often lead to landlords having to lower their rent to accommodate a wider range of potential tenants. You can't do much to prevent economic issues, but paying off a chunk of your mortgage will at least lower your monthly expenses.
5. The Juggling Act
Arguably the biggest challenge with DIY rentals is the fact that you probably have another job to attend to. In reality, property management is a full-time job if you're going to do it properly. For those that are juggling their career and a rental property, it can be a huge help to hire a property management company.
For Rent by Owner: Does It Really Work?
Does the "for rent by owner" thing really appeal to you at this point? Hiring a property manager gives you all of the joys of renting your home with none of the hard work.
For your Oxford and Lafayette investment properties, the best property management solution is Cissell. Visit our site to learn more about what we do and contact us to discuss your property management needs.