Three Must Do’s for Newbie Landlords by Tony Martinez
Some of you may have sworn off renting your properties, I mean, we have all had bad experiences with renters. But realistically, some house purchases warrant renting. Sometimes flipping and selling isn’t the best option, or the most lucrative. But for those who haven’t rented before and are looking to, as it seems like the best option for a property at this time… then take a look at my advice below. Frankly, some who have acted as landlords in the past will likely find this information helpful.
- Have Reserve Cash: One week a branch could fall and tear on the roof and the next the water heater could go out. Depending on your insurance coverage you may have help with the costs of the roof damage, but the point is you never know what is going to happen. But you do know you need to have cash on hand to cover these urgent repairs. Don’t be in a position where rent barely covers expenses with little left over. Have a reserve, and be able to build the reserve quickly back when drained.
- Get a P.O. Box: Don’t give your home address to your renters, please. This could prove disastrous later. To protect your privacy get a P.O. Box so tenants can mail their rent to it, rather than your personal residence. Better yet, use an online service for renters to pay monthly so that the transfer of funds is almost instant, and there are no issues with checks getting lost in the mail.
- Seriously Consider Outsourcing Property Management: It may seem expensive at first (usually property management services are 10% monthly rent) but when you consider the amount of time, energy, and stress you are saving by not being personally involved in the day-to-day management of rentals it is worth it. Early on I tried to manage properties myself to save a little cash every year, but found that my time was much more valuable and was better spent elsewhere.
Your landlord experience doesn’t have to be a horror story. Do your research, take experienced investors advice, and consider renting as a serious strategy for your investment properties.
Tony Martinez is the Founder and Chairman of the US Tax Lien Association, which is an organization that is committed and dedicated to helping others achieve total financial freedom through the power of investing in Tax Lien Certificates. With over 30 years of expert experience, Tony is the world's #1 authority on the subject of creating enduring wealth through the little know strategy of investing in Tax Lien Certificates, which gives anyone the opportunity to earn guaranteed fixed rates of returns of 18% – 36% interest per year, and acquire valuable real estate for approximately 10% of market value.
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