I’ve been a landlord for almost 5 months now. I have learned a lot of different things along the way, but so far it has been easier than I thought it would be. The main part is, since we have a crew of workers, we can easily get stuff fixed for tenants when it is our responsibility to fix.
Right now we own 9 units, 8 single families and 1 duplex. Nine of the units are rented and one is under construction. We bought our first rental in August-09 and placed our first tenant for Sept 1st, so we have done quite a bit in the last 5 months.
Some of the things I have learned:
- Signs pull WAY more phone calls than I ever thought they would. Being a young guy, I thought property signs are kind of old school, but I would guess 75% of our phone calls come from the signs. The people who call off of the sign are also usually best qualified (they’re already in the area for some reason anyways.
- Ask a lot of questions. When a tenant is looking solid, I always schedule a meeting to “show them the property.” I ask a lot of questions along the way. How much they pay at their current place, why are they moving, what they like about my property, etc.
- Most renters have really bad credit (this may say something about the type of property I keep), but anything above 600 is a great credit score for one of my renters.
- Trust your gut. I make exceptions to certain requirements for people I feel comfortable with, but force the tenants I am less comfortable with to meet every step.
- When people try to negotiate your price from day 1, be suspicious. When we’re asking $1,200/month and before asking any details of the property they offer $1,000/month it’s not worth your time.
- Don’t defend your houses imperfections. We are used to selling turn-key properties with a full rehab. At the start tenants would point out flaws (style of faucets, pink tile in the master bath) and I’d defend it or offer to fix it. Now I just acknowledge that it exists.
- Becoming a landlord is not the quick path to wealth. We have positive cash-flow on every property, but the numbers are definitely not even close to exciting. The tax benefits on the other hand, are a whole different conversation.
- Be prepared to meet tenants on evenings and weekends.
That summarizes my experience so far. I am happy that we decided to self manage our properties, it is a lot of work, but I feel confident with the people we are picking.