I never intended to become a landlady but my pending out of state move made it inevitable. I was not about to sell my house as the market was continuing to improve. My vision of a landlord was much like the school lunch lady, usually mid-50s and disgruntled for no readily apparent reason. As someone in my late 20s I had a hard time seeing myself in this role though my self-image was the least of my worries. My mind was swirling with questions about my new landlady responsibilities. Would the tenant trash my beloved first home? What would I be liable for? Can I charge enough rent to cover my mortgage? What tax implications are involved in having a rental property? How do I manage everything thousands of miles away?
I knew there were professional property managers I could hire to handle things but I am a penny pincher and save every opportunity I can. Being a generation Y’er, I turn to the internet to solve my problems. Enter the World Wide Web and massive information overload. I read articles seeing messy evictions, costly squatting, the wide range of ways a property can be destroyed from pests to pets to drugs to water damage and all the things I didn’t even know I didn’t know about renting your house.
I started looking into the wide range of leases, tenant screening methods, tax, state and fair housing laws. I knew that I could save a little money each month on management fees and assume I am smart enough to make the right legal, accounting and other crucial decisions. On the other hand, I could hire a professional who has a bank of resources, network of experts, years of experience and whose living is entirely based on managing rentals well. I knew there were huge financial and legal risks I was exposing myself to by becoming a DIYer. I also knew that vacancy rates are around 9% while professionally managed properties boast half the vacancy rate. Vacancy is expensive (meaning a huge loss of rental income plus the cost of turnover) and this fact alone was almost enough to convince me. I knew I could spend time trying to learn about all these subjects and struggle to manage my property from thousands of miles away, effectively letting my house control me. Alternately I could buy myself some peace of mind and enjoy half the vacancy rates while I spent time adjusting to my new home, job situation, focusing on how to maximize my other assets.
I ended up finding a property manager with over 10 years of experience, who handles everything for me. The tenant he placed is quite like me, fastidious and responsible. My manager checks on the property regularly and I get a rent check every month that more than covers my mortgage, management fees and taxes. So, no stress over advertising the property, picking the right tenant, setting rates, rental housing laws, late night emergency calls and no disgruntled landlady here. I just get to sit back, collect money and build equity. I guess being a landlady isn’t so bad after all.
Category: Ready to Rent: Tips & Tricks