Common Mistakes Landlords Make

If you can make money by doing nothing, the freedom and the possibilities can build a lifestyle better than most people experience. Some people are lucky enough to own multiple properties, or have such business knowledge that they know the benefits of investing in property. Property has always been a solid investment. It can seem like a dream come true to be a landlord, and leasing out your property to produce passive income. 

Everyone makes mistakes, and sometimes the mistakes can be costly. As a first-time landlord, there are a lot of mistakes that could be made. Errors can make you or break you, depending on the severity of the error and how costly it is.  

Here are five of the most common mistakes, as well as tips on how to minimise their impact:

1. Tenants’ Privacy Rights – You cannot just invade a tenant’s premises. You would be infringing on the renters’ privacy rights if you did so. Upon entering the rented property, you must give your renters at least a 24-hour verbal or written notice.  The time for the notice should be in the contract and must be adhered to by all parties.

2. Miscalculating the expense of fixes or ongoing property upkeep.

You must manage the property in order to keep renters interested in living there, and paying for it. Assure your revenue is sufficient to pay at least a share of your recurring maintenance fees.

3. Failure to Include a Lease Term – Any tenancy agreement must specify a start and end period. Renters will never be confused on their move-in or move-out date this way.

4. Poor Handover – To avoid future conflicts and your words vs the tenant’s claims, it is necessary that the present condition of the property has a complete inventory list and be fully recorded before handing over the unit to the renter.  Some landlords take pictures, others videos of the property upon handover, and the condition of the property should be documented and signed off by both parties as an accurate description of condition.

5. Failure to conduct a move-in inspection check – Similar to item number four, before a tenant moves in and after the tenant moves out, it’s a good idea to show that the property was in good shape before the tenant moved in and after the tenant moved out. This may take the form of a written report, photographs, or videos. If you do not have such evidence, you will be unarmed in court.

Everyone makes mistakes. There is a level of trust implied upon allowing a tenant into your property. Insurance and documentation is essential to maintain the property. Contracts signed and agreed upon, and tenants and landlords should both understand their roles and responsibilities in the transaction.