Retiring and making money as a landlord is a dream that many people have. They imagine buying one or two homes a year and having a large number of homes that they own and rent out by the time they retire. These prospective landlords think that all they need to do is sit back and collect the rent money that comes in every month. Working as a landlord takes a lot more work than that though because you are responsible for the general maintenance and upkeep on each property that you buy. Before buying a single home to rent, you should consider three key things that landlords do.
Do You Have an Emergency Cash Reservoir?
Being a landlord requires more money than the amount you put down when buying a home outright or taking out a mortgage. You also need an emergency cash reservoir to cover any of the emergencies that might pop up later. Even with a thorough inspection, you never know when a home might need some repairs because of termite damage, a new roof or even some new appliances.
Where Will You Find Tenants?
Finding good tenants is one of the most important things that a landlord does. You need to know where to find those tenants and how to choose the right people for your homes. Doing criminal and civil background checks can cost quite a bit of money. If you avoid doing those checks, you risk renting to people who never pay their rent, those with criminal histories and those who will do damage to your homes. Even if you do not do background checks, you’ll still need to get references from prospective tenants and call those references.
How Will You Evict a Renter?
The eviction process varies from state to state, but most states require that you notify tenants that you plan to evict them and give them time to move out before you can file in court. They then have until the court date or even longer to move out, and the court can give them even more time. Property management Phoenix companies handle the eviction proceedings for their clients. They alert tenants when they fall behind on the rent, charge them fees for late payments and can file evictions for you. Before you decide to become a landlord, you should make sure that you consider all these aspects of owning rental homes.