Rentals-Should I be a landlord?
I remember the first time I became a landlord 20 years ago. I was worried and scared about how do I make the payments if my renters leave? What happens if they destroy my property? What if I have to evict someone? These questions and much more raced through my mind. Here are a couple of questions I would ask anyone that is thinking of being a landlord.
-Do you have some cash reserves?
-Are you able to add more stress in your life?
-Are you ready to get your hands dirty?
Cash Reserves-Do you have some? In the beginning, there is chance that your property will be vacant for a month or two. Do you have money set aside that you can use to pay that mortgage payment? Do you have enough available income to support that extra mortgage payment? If you are barely paying your own bills, I would caution you to jump into a rental property. Build 2-3 months of worth of payments for your rental before starting.
Stress-Becoming a landlord will bring some additional stress. A phone call from your renter could raise your anxiety quickly. Those questions I mentioned above could be issues that you have to face. Talking with renters is key as well. If you are shy and don’t like to talk or confront renters about late pays, this might not be the best alternative for you. You can hire a management company, but that will eat into your profits.
Dirty Work-At the start of being a landlord, I had to get my hands dirty. I had to ask for help and learn how to fix issues. Don’t be afraid to try and fix things. The more you fix, the cheaper it will be to repair issues compared to hiring a contractor. The one thing I didn’t have when I started was the popularity of YouTube. You can virtually learn how to fix most problems.
I know individuals that started out by buying 6-12 properties and seen them succeed. I started out with 1 and added from there. You need to find your comfort level and do it. I highly recommend anyone that can answer the 3 questions positively to start. Owning my rentals by myself and with my business partner is the reason that I can now do this full time. Looking back, my biggest regret was not starting sooner.
#rentals #rentalproperty #landlord
