Top 8 Traits of Successful and Effective Landlords

Some landlords seem to have it all: they make a nice a chunk of money each month from their rental property investments, their tenants love them, and they’re able to take vacations without their business suffering.

On the other hand, less successful landlords are often forced to deal with lots of stress, difficult tenants, the financial consequences of investing in unprofitable properties, and other challenges.

successful-landlord

Which kind of landlord do you want to be? 

Obviously, you want to be the successful one. Most landlords start investing in rental properties because they envision themselves becoming a thriving business owner.

Do you have what it takes to make that happen? 

To find out, read on! You’ll learn the traits of a successful and effective landlord and what you can do to acquire those traits.

8 Qualities of Successful and Effective Landlords

1. Successful landlords are persistent.

Running a rental property business is no easy task. No matter how effectively you do it, you’re likely to face tough times at some point.

Maybe you’ll rent a property to a difficult tenant who must be evicted, or maybe you’ll invest in a rental property that isn’t profitable. During those difficult times, it’s important for you to be persistent and avoid giving up on your business. Realize that all you can do in those situations is learn from your mistakes and use the opportunity to improve the way you run your business.

2. Successful landlords are reliable.

Put yourself in your tenant’s shoes for a second. How would you feel if  you had a landlord who never kept their promises? 

You wouldn’t like it. And neither do your tenants.

reliable-landlord-with-tenant

That’s why it’s important to be reliable and do the the things you say you’re going to do. Otherwise, you will build a reputation as an unreliable landlord, and that bad reputation could negatively affect the way you are perceived by potential tenants, causing them to avoid renting from you.

3. Successful landlords are communicative.

No tenant wants to deal with a landlord they can never get in touch with, especially when a major problem arises with the property. Whey they do want is a landlord who addresses their concerns quickly and communicates clearly about maintenance, inspection times, and other important dates.

Don’t leave your tenants in the dark. Even if you live in Montgomery county where landlords have a right of reasonable entry, you should still inform your tenants ahead of time when you plan to enter the property. They’ll appreciate the courtesy.

While it’s good to be communicative, keep in mind that it’s important to set boundaries with your tenants, too. For example, you should set office hours and let tenants know that they should only call you outside of those hours if there is an emergency.  Otherwise, you may receive tons of phone calls about minor issues in the middle of the night or at other inconvenient times.

Tip: If you’re not communicative or if you prefer a more hands-off approach to your rental property business, you can still be a successful landlord. Just partner with a trusted Montgomery County property manager who can handle your unwanted landlord tasks

4. Successful landlords make good business decisions.

To become successful, you shouldn’t view yourself as just a landlord – you should view yourself as a business owner. After all, being a landlord isn’t just a hobby – it’s a great way to make money if you take it seriously.

Once you view yourself as a business owner, it’ll be more natural to operate like a business and set yourself up for success. That means striving to reach challenging goals, learning how to maximize profitability, and being professional when interacting with tenants.

5. Successful landlords are eager to learn.

If you aren’t sure how to operate a rental property business, you have to be willing to figure it out, even if that means buying books, spending hours reading blog posts (like this one!), and taking courses.

If you aren’t eager and willing to learn, your rental property business is likely to stop growing at some point. That’s why it is so important for you to invest in yourself as a landlord and keep learning so you can become more successful with every passing year.

6. Successful landlords are organized.

it’s no secret that being a landlord means keeping up with lots of paperwork. And, if you’re prone to losing important documentation, your job will be a lot more difficult. On top of that, you’ll have to spend time trying to find those documents, which takes away from the time you can spend making your rental property business more profitable.

rent-utilities-binders-organization

If you have had a hard time staying organized, here are a few tips to help:

  • Create a filing system. You can organize your files by tenant, by property, or a different way. Figure out what makes it easiest for you to keep up with everything, and use that method.
  • Follow up on verbal agreements. When you make these arguments with tenants, follow up with them in written form (using email, for example). This will create a paper trail and protect you if a tenant decides to dispute you.
  • Store all files online. Use Dropbox or another cloud storage method to back up all of your files online. That way, you can keep accurate records even if you misplace the physical copies of your paperwork.

Becoming an organized landlord may take some time and effort, but it’s worth being able to run your business more effectively.

7. Successful landlords follow the law.

No landlord wants to end up in court because they accidentally broke the law. That’s why the most successful landlords spend time learning all of the laws that apply to them.

It’s not enough to learn the federal laws that apply to you (like the Fair Housing Act). You must also learn the state and county laws that you must follow. Otherwise, you could face costly legal hassles.

Tip: Check out this page to learn about the laws that apply to Maryland landlords.

8. Successful landlords fix problems fast.

Fixing problems with a property doesn’t just make your tenants happy – it makes your rental property business more profitable. When you address small problems quickly, you eliminate the possibility of them turning into more demanding, costlier problems.

So, make sure you take tenant requests seriously and fix problems as soon as you can. If you’re unable to do it yourself, find a trustworthy contractor who can handle it for you.

Every landlord faces difficult situations on occasion, but you’ll be much more well-equipped to handle them if you exhibit the traits mentioned in this blog post. Now that you know what it takes to be a successful and effective landlord, you can make the changes necessary to start improving the way you run your rental property business.

 


7 Things Successful Maryland Landlords Do

Being a landlord can be challenging.successful landlords in maryland 1

It often takes some time to figure out the best ways to deal with everything from tenants to taxes.

But, you don’t have to figure everything out on your own.

All experienced successful landlords have habits that eliminate many of the risks of real estate investing while making sure their rentals continue to generate solid returns for them.

Below are seven things successful landlords do.

 

  1. Treat Your Rental Property as a Business

Even if you have just one rental property, you need to treat it like a business from the outset. This means you keep careful track of your revenues and costs. It also requires that you think about the property in the long term.

Treating the rental property as a business is essential if you want to take full advantaging of tax deductions generate a decent return on the investment. If you don’t treat the rental as a business, you will end up with an expensive and time-consuming hobby.

 

  1. Remain Consistent

Successful landlords are consistent with tenants. This means following the lease every time.

Charge late fees when they are due. Don’t allow special treatment for one tenant. This doesn’t you mean you cannot be compassionate, but failing to treat all your tenants the same way opens you up to business and potential legal trouble. Being consistent also means your tenants and neighbors know they can depend on you to keep your word. This makes them more likely to keep their word with you in return.

Landlords who are making the kind of returns on their rentals you are aiming for know that investing is a long-term strategy. When you stick to a strategy, you will see property values increase over time and cash flow on rental units improve. Remember it was the slow and steady tortoise that won the race.

 

  1. Reinvest in Your Business

You have to spend money to make money.

The nature of rental properties is they often take a lot of wear and tear. If you want to keep properties rented you have to reinvest in the units.

This means more than just putting on a fresh coat of paint every once in a while. Successful landlords look for ways to consistently add value to the property by investing small amounts in everything from improving the landscaping to adding small amenities.

Reinvesting in your business can also mean acquiring more rental units. Once you get the hang of your first rental, it may make financial sense to grow you inventory. Often the riskiest rental investment is only having one unit. If your tenant moves out you have a 100% vacancy rate and no income.

 

  1. Always Know the Break-Even Point

analyzing break-even points of maryland rental units

Part of running any type of successful financial enterprise is knowing what your break-even point is.

How much do you have to make every year or month before all your costs are paid?

If you know your break even point you make better choices. This requires that you not only have a firm grasp on your expenses, but that you also understand the difference between revenues and profits. It’s easy to bring in a lot of money without turning a profit.

The higher your break-even point is, the harder it is to run a profitable business. Landlords that are doing well have mastered keeping costs low and predictable, while keeping rental income growing.

 

  1. Know the Neighborhood

Whether your rentals are in Baltimore, Silver Spring, or Chevy Chase, you need to know what is around your rental.

Knowing the neighborhood means understanding the direction development and property values are trending. It also means being able to better target tenants who will be a good fit for your property.

Successful landlords know they have to do more than just sell renters on the idea of their unit. They have to sell renters on the idea of living in a particular neighborhood.

The more you know about the schools, businesses, and community your rental is in, the better you are at explaining the benefits of your rental to potential tenants.

Landlords that understand the neighborhood know how to attract ideal tenants instead of just finding anyone willing to sign a lease.

 

  1. Have a Cushion

Rental properties are a great source of income, until they are not.

There will be times when the property is vacant or some unforeseen expense wipes out a month or more of rental income. Landlords that have thrived in the rental business for years have set aside a cushion to see them through the tough times.

Poor financial decisions are made out of desperation. You are much more likely to rent to a questionable tenant if you are in a tight financial bind. But, if you have a few months cushion, you can wait to find the right tenant that will pay you on time for years to come.

Developing a cushion is toughest at the beginning. But with careful budgeting, a small amount can be set aside every month until you have grown a cushion to see you through any rough patches without ruining your business.

 

  1. Have a Property Management Company

However you came to be a landlord, you likely don’t want to be on-call 24 hours a day for questions about everything from when the rent is due to what should be done about the leaky dishwasher.

Hiring an excellent property management company allows you to spend your time more efficiently and letting someone else take care of much to the day-to-day tasks of running a rental. A good property management company also helps you make wise choices that will maximize the value of your rental.

 

Maryland is a great place to be a landlord. But, it takes more to be a successful landlord than just finding tenants. If you copy what successful landlords do differently from everyone else, you will be ready to take your place tomorrow among the happy successful landlords you envy today.