What No One Tells You About Becoming a Landlord
3 Essential Tips For First Time Landlords in 2020
1. UNDERSTAND THAT RENTING OUT YOUR PROPERTY NEEDS TO BE A “WIN WIN” SITUATION
Many first time landlords face significant challenges as they go from a place of someone who “has dreamed of owning real estate” to someone who’s responsible to find the “ideal tenant” to put into their real estate property.
Here are some tips to remember if you’re transitioning to this role for the first time. I would suggest that if you are thinking of becoming a landlord, that the first thing you do is read the RTA (Residential Tenancy Act) and become familiar with the LTB (Landlord and Tenant Board).
I would go as far as advise you to go and attend a few LTB hearings and speak to landlords who are waiting to get their matter taken care of. You will hear some horror stories and you’ll need to ask yourself, if this is what you may need to face as a landlord. You will also need to ask yourself if you’ll do what it takes to become educated about your rights and obligations as a landlord.
Being a landlord in 2020 is “dangerous” and I don’t use that word lightly. You need to be aware that there are landlords who haven’t been paid for a year their rent and that they will find their homes destroyed. Are you ready to face this? If you don’t begin to understand how important it is to choose the right tenant to begin with, then you will be plagued with sleepless nights worrying about your property. I always advise new landlords to get a coach or mentor who has been successful in choosing their 5 Star Tenants and is willing to share their “secrets” with you.
2. COMMUNICATE WITH TENANTS
The way I deal with tenants is strong and consistent communication.
When you have the luxury of being the “judge and the jury of who you choose to come into your buildings” as a landlord, the pressure and the onus is on you.
If there are tenants who come to your ‘Discovery” interview and who don’t understand who owns the property and who has the right to choose them. And if you do choose them, they need to respect what they have signed and what your relationship is all about from the moment you meet them.
That relationship between the landlord and tenant is about mutual respect and trust.
If you as a landlord don’t demand respect and trust, and remember that goes both ways, from the moment you meet them, then you are being a pawn.
It’s your fault for not creating the infrastructure for them to shine. Just because someone shows up to view your rental that is just the beginning of finding out and feeling out if they will be your next great 5 Star Tenant. This doesn’t happen overnight. It may take you up to 2-4 weeks to make sure that they will be a good fit for your property. RULE OF THUMB – NEVER RUSH TO LET IN A BAD TENANT!!!
3. BEING NICE AND OPEN IS ROI POSITIVE
I want to create a conversation around the practicality of positivity, kindness, and empathy toward your tenant. I’m not just saying it to be ideological — instilling those characteristics and traits as part of your culture has significant long term impact for your business of being a 5 Star Landlord. At Niagara Rentals, Sarah Wright is our, “Sympathetic Heart”, and is number two in the org chart in my company. Now having said that, remember you need to find the right person who will fit into your type of “Avatar” as a tenant. I have a picture of who my next 5 Star Tenant is and whom I accept into my buildings. I may have to go through 100 people, before the right one appears!! I learned through making mistakes, that I need to dot all my “I’s” and cross all my “T’s” before I choose the next 5 Star Tenant. I never rush into this most important part of my business. If my tenant doesn’t pay or destroys my property, then what kind of business am I in?
I hope I’ve given you food for thought and that you will go out and do your “homework” to find out how to become a 5 Star Landlord who chooses a 5 Star Tenant. Good Luck on your new journey.