5 Easy Steps for Being a Successful Landlord

5 Easy Steps for Being a Successful Landlord

This may come off sounding a little harsh, but I believe the vast majority of landlords out there are absolutely terrible.

I'm not just referring to the way they treat their tenants, though that is a problem as well. I'm talking about the way they run their business. I believe being a landlord gets a bad reputation largely from those who fall into this "terrible landlord" group, but in reality -- being a landlord is not an impossible task and success can be found.

The following are five tips for being a successful landlord, most learned through mistakes I've made in my own landlording journey. If you have any additional tips, I invite you to share them in the comments below the post!

1.) Treat Your Business Like a Business

As I mentioned earlier, many landlords do a terrible job at running their business and I believe this is largely because they don't see their business as a business. In other words, they treat their investing like a hobby. However, when you treat your landlording with the respect, systems, and organization that you would treat any other business venture, amazing things can happen.

For example, when is the last time you read a great book on business leadership? Or, what systems do you have in place so maintenance concerns can be fixed without your direct involvement (in case you happen to go on vacation the day a water supply line breaks!?)

When you shift your perspective as a landlord from "hobbyist" to "business owner" -- and treat your company as such - you will find far greater success.

2.) Screen Out the Bad Apples

Perhaps the biggest mistake landlords make is letting in the wrong person. This can lead to late rent, trashed homes, and costly evictions.

This ties well with number 1, because people treat their business like a hobby and refuse to follow even simple due diligence on the people who will be living in their properties. What would a bank say if you walked in, completely unqualified with no income and a 450 credit score, and asked for a large loan? A bank doesn't run on emotion, and you shouldn't either. So screen like your business depends on it -- because it does.

When screening for tenants, I typically require:

They must make 3x the monthly rent in stable income

No recent evictions

No recent felonies

Good previous landlord references

Be careful not to screen out tenants based on any of the protected classes, or you could find yourself in a lawsuit or sitting in a jail cell.
For the step by step process I use to screen tenants, check out the most in-depth post I've ever written, Tenant Screening: The Ultimate Guide.

3.) Treat Your Tenants with Respect

Look -- we don't have to like our tenants.

In fact, I flat-out despise several of mine.

However, don't allow personal feelings to get in the way of a business relationship (see #1.) Tenants want to be treated fairly and be seen as an equal human, because they are (no matter your personal feelings toward them.)

Just because you own some rental property doesn't make you a better person -- so don't act like it.

Treat each tenant with dignity and respect and it will come back to you in success.

4.) Don't Be Too Nice

This probably sounds like a complete reversal of what I just told you, and maybe a little harsh, but please allow me to explain.

Your job as a landlord is to be fair, not to be nice. Being "nice" will give your tenants and others the invitation to walk all over you and take advantage at every turn.

"But Brandon" they say "It was Black Friday and I really needed that big screen TV. I get paid again in two weeks. Can I just pay you then!?"

No.

The lease says rent is due on the first, so just as I am expected to fulfill my duties and obligations as a landlord, I also expect my tenant to fulfill theirs.

Humans have a tendency to keep taking more and more when given slack, something I often call the "if-you-give-a-mouse-a-cookie" syndrome, based on the children's book where a small annoying mouse continues to push the envelope, asking for more and more things after it's been offered a cookie.

By allowing your tenant to break the rules, you open yourself up to years of struggle and compromise that will ultimately lead to huge financial losses.

There is a difference between respectful and being nice. Choose wisely.

5.) Get Help

No landlord is an island.

With over 28 Million real estate investors in America, (Source: BiggerPockets.com / Memphis Invest National Survey of Residential Real Estate Investors) there are bound to be countless investors in your town who can help you out during tough times.

Whether it's the phone number for a plumber, help dealing with a tough eviction, or just reassurance that you are doing the right (or wrong) thing, reach out to other landlords for help. Landlords love to "talk shop" so look for opportunities to open the conversation.

If you can't find local landlords, the Internet is full of real estate blogs, forums, podcasts, and more to help you connect with other investors for free. Take advantage of this and never stop learning and growing as a real estate investor.

Conclusion

A successful landlord is one who doesn't feel like pulling their hair out every time the phone rings. It's someone who actually looks forward to the beginning of the month when the rent checks start coming in. It's someone who runs a tight ship with systems that can handle the big waves that are bound to come.

Success is possible as a landlord, if the right steps are taken. Hopefully this post has helped you take those first few steps in changing your business for the better. bturner

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Excellent tips

Excellent tips !

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Watch your words, for they become actions.
Watch your actions, for they become habits.
Watch your habits, for they become character.
Watch your character, for it becomes your destiny.
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

Our Heart's Desire must be nurtured by our mind,to give birth to common sense, that will enable us to seek out the path less traveled, with the greatest Personal Growth. -J.R.-


Great post, Randy!

This is a very good post and one that is very much needed.

Thanks for putting it up.

Karen

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"You're never too old to be what you were meant to be!"

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Thank you Randy!

No matter how many books I read on being a landlord, or how many landlords I spoke with, it wasn't until I owned rental properties and personally dealt with tenants, that I gained the experience needed to follow the tips given in the above article Eye-wink

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Valerie

“And will you succeed? Yes indeed, yes indeed! Ninety-eight and three-quarters percent guaranteed!” ― Dr. Seuss

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Great advice

Thank you! Guess one has to really jump in there to know though as Valerie states, but this is a good roadmap!

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Great tips

Thanks for sharing Randy.

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Reynold Orozco


Hello Randy

I'm glad I stumbled upon this post.

Thanks for sharing these awesome tips.

Best of luck in your investing!!

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TC
Miami Florida

"If you are not doing something that help the universe or God or your family, or YOU, is that something you should still be doing?"-Dean Graziosi

"Each day do one thing to get you closer to your dreams because if you do today what others are not willing to do, then tomorrow you can do those things that others are only dreaming about doing!"- Joe Jurek

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this is a very nice good

this is a very nice good tips thanks for sharing it


Thanks very much. This is

Thanks very much. This is very useful.

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The secret to living is giving


Randy always has

great tips and posts! Haven't seen some of the coaches post in a good while though.

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www.tw4homes.com website
https://tvallc.isrefer.com/go/RehabLite/reigirl/ FREE SOFTWARE FOR WHOLESALERS, REHABBERS AND AGENTS! Present professional looking deals to buyers and lenders as well as run your numbers and get the ROI.


You really hit the nail on

You really hit the nail on the head. Owning income properties IS A BUSINESS and it should be run as such. Landlords that suck every penny out of the rental income and put it in their pockets are not running a business well. There has to be a fund for maintenance, repairs and upgrades.


As a landlord myself...

I bought my first property at 27 and I refinanced it twice. I was barely making money and was a too-nice landlord. Now that I'm older and with the tips I get on this forum, I am planning a return in business.
What is everyone's favorite book and rental properties? I'm currently studying the flip course with Matt and Nate but they barely talked about rentals as of yet.

The idea of setting aside a portion of your monthly income for repairs and vacancy is new to me and I want to know more.

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I am a REI in training. Already own 15 appartments in 4 and 3plexes and wish to continue expanding. Based in Southern Quebec, Canada.


thanks coach

Yes you hit it right on the head people seem to take advantage of kindness all to much.People need to respect and follow through on all there obilgations and follow through, good stuff Coach, many thanks, Jim

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jbischoff


Forming LLC

Should I form an LLC as a landlord? If yes, should I form different LLC for each property?

Thanks.


I agree

I got into real estate years ago before joining dean and ive had a few rentals, yep had the renters from hell and that was my fault..
You do have to treat them with respect but they have to understand the 1st is still the 1st.
I have a rental across town and from time to time they ask if they can pay a few days later, what they mean is a week. I say no problem you do know that's $20 per day! If I let them go a week not paying think about it, that's only three weeks for next due date if they cant pay now are you sure they can pay more then hmmm im saying no. I do let them go a few days but it will cost them, its cheaper to pay on time.

Learn as we go

Aaron


AARON AND COACH GREAT INFO

be fair not nice. i have heard many thoeries on getting payments on time over the years.


Hey Walt

I like to send birthday and holiday cards out I think that helps how they see me..

Just a thought

Aaron


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