- Know Local Laws. Nothing will sink your rental faster than neglecting to follow local laws and regulations. Find and read the local landlord tenant laws, fair housing laws, and building codes to ensure you don’t get in hot water.
- Get It In Writing. Handshakes may be how you do business but they aren’t how the courts do business. Do yourself a favor and shell out some cash to get a good lease drafted by a reputable real estate attorney and be sure to use it every time (before you hand over the keys to the tenant).
- Screen Your Tenants. Create an application form and use it to submit tenants for credit and background checks. Also be sure to verify their income.
- Don’t Put Off Maintenance. Maintenance represents about 51% of your rental property’s success. Don’t put off needed items, they won’t get better with time. Often they become more expensive the longer you wait.
- Be Careful With Security Deposits. Local law will dictate exactly what you can and can’t do with a security deposit. While you may rightfully think that you are well within your rights to keep the security deposit because the tenant failed to clean properly upon move-out the law may state otherwise.
- Track Expenses. Be religious about this. The majority of landlords couldn’t tell you how their property is performing because they don’t take the time to track it.
- Stay Organized. Create a file for each of your properties to keep leases, receipts, invoices, tenant correspondence, tax records, insurance policies, and other items in. File new items immediately and review the files monthly to ensure they are up to date.
- Create Systems. You can either solve the same problem 100 times or you can solve it once, document the solution and reuse it thereafter. Systems ensure things are done correctly and efficiently every time.
- Set Policies & Stick To Them. No exceptions. Not even for your brother-in-law. If rent is late a late fee is due. If lease terms are violated an eviction is filed.
- Treat It Like A Business. Leniency on any of the above nine points is the gateway to failure.