Investing in a Pikesville rental property is a great way to supplement your current income, build your retirement fund, or even just create some extra cash on the side for a fun vacation.
And, now is as good a time as ever to put your money into the real estate market, and start raking in the positive cash flow.
However, as a prospective rental property owner, there are some things to watch out for before putting all of your hard-earned cash into the “perfect rental property.”
And no, we are not talking about the run-of-the-mill advice that we see over and over:
- Find a great location
- Understand your financing options
- Calculate prospective ROIs
- Work with industry professionals
- Get out of debt before buying
- Determine going rental rates
Of course, these are all exceptional pieces of advice.
And, these tips should never be ignored when it comes to getting into the rental property business.
However, there is a lot more to becoming a successful rental landlord, especially in the beginning when you are looking for a property to purchase and lease.
That’s why today we are going to share with you some lesser-known tips on becoming a successful landlord. This way, when the time is right, you are fully prepared for what is to come.
5 Tips for the Prospective Pikesville Rental Property Owner
1. Avoid a Fixer-Upper
It is safe to say that this tip will not apply to every Pikesville rental property owner.
In fact, we have talked about investing in fixer-upper rental properties in the past, and have even claimed they offer property owners plenty of benefits.
Discounted prices, higher positive cash flow, and less competition are just some of the many benefits of investing in a fixer-upper rental property.
However, for those that are just starting out in the rental property business, this may not be the soundest advice.
Fixer-uppers tend to cost more money and take longer to renovate than initially expected.
Rather than wasting more time and money in the beginning than is necessary, it is best to purchase a rental property in as close to move-in condition as possible.
This way, you can place tenants in the property right away, especially with the help of your Maryland property management company, and start bringing in rent payments immediately.
2. Look for Simplicity
You know that beautiful Pikesville property you have been eyeing forever?
The one with a slate rooftop, crown molding, custom paint colors and window treatments, specialized lighting both inside and out, and a breathtaking pool in the backyard, complete with a cascading waterfall?
Well, as nice as all of this seems, for an inexperienced property owner without much equity or incoming cash flow, a property like this is bound to cost a lot more over the course of a tenant’s lease term than you would like it to.
Custom designed homes can rake in higher rent rates, that’s for sure.
But, they are also more difficult to maintain, and are harder to fix when it comes to replacing custom elements such as lighting, paint colors, and window treatments.
That’s why aiming for a more simply constructed rental property is often better.
You should also consider how easy it is to access the rental’s heating, cooling, plumbing, and electrical systems.
After all, these are things you or your property management team will be responsible for, should anything break.
Repairs on a plumbing system that is hidden deep within the walls and ground of your rental property are sure to cost a pretty penny.
Look to invest in a rental property that offers many simple amenities (because amenities do garner higher rent rates, and attract more tenants), but also a property that has a basic structure and uses standard materials.
3. Inspect the Property
Before purchasing any real estate, it is critical you have the property inspected.
This is even truer when it comes to a Maryland rental property.
Because in Maryland, property owners have a legal responsibility to provide their tenants with a safe and habitable place of living.
A plea of ignorance will not sit well with the courts, should you face a landlord-tenant dispute because your rental ended up being unsafe and hazardous to the tenants living in it.
Electrical fire hazards, mold, lead paint levels, extreme rodent and pest infestations, and other safety and health issues will ruin your rental property business if you’re not careful.
Plus, it will not bode well in the community if your reputation precedes you as the landlord that didn’t care for his tenants.
If you are a prospective rental property owner, it’s important to have any property you think you may want to invest in inspected.
The small cost associated with a thorough inspection, as well as the inspection checklist you can provide your tenants upon move-in, will ease the mind of your tenant and prevent any disputes in the future about unsafe living conditions.
4. Watch the Utilities
Offering your Pikesville tenants an incentive to move into your newly acquired rental property is a great way to grab a high-quality tenant, and bring in a consistent flow of cash.
Many successful landlords offer to pay for a portion of their tenant’s utilities each month.
This added bonus is often enough to get a tenant that is on the fence about moving in the push to sign a lease agreement.
And, as a way to lower vacancy rates and keep lease renewals high, this incentive is very effective.
However, you should be careful when it comes to “paying for” your tenant’s utilities.
Oftentimes if the utilities you are paying for are in your name, you are financially obligated to pay those bills in full each month, regardless of whether your tenant is paying rent or not.
For a non-payment situation, this could mean you have to shell out cash of your own, despite not receiving a monthly rent payment, until an eviction goes through.
This is not wise.
If you are going to offer to pay for your tenant’s utilities such as water, sewer, trash, or gas, consider offering this bonus in the form of a lower monthly rent payment.
It will then be your tenant’s responsibility to have the utilities in their name, and pay them in full each month.
5. Create a Maintenance Crew List
Property maintenance is a big part of being in the rental property business.
This is why all prospective rental property owners should take care to create a maintenance crew list before purchasing an investment property, so that maintenance and repair requests after a tenant moves in will not be an issue.
One great thing about enlisting the help of an experienced property management company in Pikesville is that they typically have a sizable Rolodex of licensed, insured, and bonded contractors for helping your tenants with all of their maintenance issues.
Not only does this save you the time of having to wade through endless contractor possibilities, it makes property maintenance simpler because someone else is handling it for you.
Timely, affordable, and reliable maintenance crews that work for your property management team around-the-clock will ultimately provide exceptional customer service to your tenants, and make your life much easier.
In the end, there are many things to think about when it comes to purchasing a Pikesville rental property.
And, for those that are looking to replace their day job with being a landlord, supplement their retirement income, or make life more enjoyable thanks to the extra positive cash flow from a rental, success is not optional, but mandatory.
If you want to boost your chances of achieving success as a rental property owner, get in touch with Bay Management Group today.
With us, you maintain complete control over your rental property, but receive all the help you need to become successful.
This includes advertisement of your newly-purchased rental property, tenant screening and placement, rent collection, move-in and move-out inspections, and of course, help with eviction procedures should that become an issue.