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5 Big Challenges To Accept If You Want To Become A Landlord
More people young and old are going to step into the shoes of becoming a landlord. The job at hand can be both rewarding and depressing depending on your personal outlook. If you had somehow pictured the job of a landlord is to stick out you hand and collect rentals, you could be due for a rude awakening. It is a tough job although it can be hugely rewarding. Here are the 5 main challenges you are staring at right in the face.
Beyond office hours. It is time to slap yourself awake if you think being the great time manager that you are, you will be able to squeeze all the work into office hours from 9 to 5. Or only attend to issues when you have time. When tenants need you, you have to respond in a timely manner. And your response has to be immediate in times of emergency. Being an unresponsive landlord will entice tenants to look for alternatives.
If you have a leaking going on in one of your properties, you can either call a plumber to attend to it or drive your way straight down and attend to it immediately. This can happen in the middle of the night. Yes you might feel that a simple leak can be fixed by the tenants themselves. But tenants do not feel that way. They have paid you for an apartment in living condition, and it is your responsibility to make that happen. Leaving the leak unattended also does not do any favours to your bottom line.
Jack of all trades. Unless the rental income you collect is enough for you to live a comfortable life while hiring a professional team to run the show for you, there are a lot of hands-on skill you have to pick up. It is best to pick up basic skills and knowledge on electrical wiring, plumbing, repairs, and basically any handyman-related stuff. Not that you are expected to fix up the wirings in your apartment. Leave that to the electrician. But you need to know these so that you are able to analyse problems and determine what exactly is the problem when a light refuse to come on or a tap just will not open up. Imagine paying an electrician $50 to come fix the lighting when you can in fact just DIY by replacing a bulb. Being obnoxious or lazy can eat into your expenses like termites on timber.
To be truly independent on property investing, you cannot allow yourself to be tied up to contractors or any service providers. Learning the ins and outs of basic handyman jobs will put you in a better position to make decisions where these things are factors that determine the outcome. By the way, a carpenter is a sexy job.
Legal obligations. The moment you become a licensed driver and gets on the road, you are subject to traffic rules. The moment you become a landlord, you are subject to law that you have to adhere to. These laws vary from country to country and state to state. You have to check for yourself on what your obligations are. These regulations can be those that concerns discrimination, deposit money, eviction, mediation, etc. It is best to consult a lawyer familiar with these laws for peace of mind.
Continuous learning. How great it would be if everything stays constant all the time. We would only need to learn how to use Windows once and forever be at peace. Well we know that does not happen in the real world. Everything is constantly changing and improving. This requires us to keep updated with latest information and needing to pick up new skills. You have to put it upon yourself to continuously learn and improve. This leads you on the road to becoming a good efficient landlord and hopefully a shrewd classy investor.
Things that you have to keep up to date include those of real estate laws, financing rules, skills to operate new technology, sources for cheaper suppliers, refining your judgement of new tenants, new networks of landlords and property investors, etc.
Taking on relationship building. Landlording is a people business. It is not a job where you sit in front of a desk each day staring at your LCD monitor. It is a job that requires you to go out, talk to people, and build relationships. Relationships with tenants will be your first priority. Other than that you have to build relationships with professionals like real estate agents, contractors, bankers, lawyers, etc. You never know when you will need an immediate opinion on an issue that a specific professional knows by heart. You will only know how important building relationships are when you run into trouble and you need an expert opinion to make an important decision.
Being a landlord can be a very rewarding move towards financial independence. But just like before you get into any new venture, you have to assess the challenges ahead and decide whether to move forward. Further more, it is a long term commitment that can run into the decades. Are you ready?