Do You Have What It Takes to Be a Landlord?

No question about it—not everyone is cut out to be a landlord. Landlording requires a lot of skills and a certain state of mind—some not easily learned or adapted to. Can you say “that’s me!” to all the following characteristics of being a successful landlord?

• I’m a risk taker. Real estate investment is a risk. You can make a lot of money—but, you can also lose all the money you invested and then some. Being risk averse will hold you back.
• I’m not cash poor. While some investment strategies enable you to dive into the business without extra cash on hand, owning rental properties isn’t one of them. You may need extra cash for vacancies, evictions, unexpected repairs or unpaid tenant utilities—just to name a few.
• I’m organized. While being organized may not be as critical when you own one property but, once you get a few more, being organized is essential. Simply forgetting what you put where can be frustrating, but even more important, not keeping files in order, etc. can lead to violations of lead disclosure laws, fair housing laws, etc. and leave you defenseless in case of a lawsuit. Remembering which unit or what tenant needs what is also important.
• I’m a detail person. Great! Because those that aren’t detailed people find themselves in a world of hurt when they forget to cross a “t” or dot an “i.”
• I’m not a procrastinator. Everyone will demand your attention once you’re a landlord—your tenants, the municipality, the neighbors to your property, and (hopefully not) the police. Ignoring tenant complaints, repairs, bills, etc. is a formula for failure. Also, not getting on top of repairs needed to resolve city violations can lead to fines, fees and potential prosecution.
• I’m a people person and don’t mind confrontation. If you hate talking to people or hate confrontation—being a landlord is probably not for you. While relationships with most tenants are great there are always the one or two relationships that go cross ways—past due rent, parties, unapproved tenants, trouble with the neighbors, housekeeping issues—things happen that involve a need to communicate. You may also have to deal with not so friendly city inspectors, utility personnel, contractors, or bill collectors—or the parents of your tenants.
• I don’t take things personally. Like with just about every business, there are likely to be times where someone will attack your integrity or call you unfair or callous or racist or whatever. If you’re the type of person that let’s what other people think or say about you get under your skin then you might not be ready for property management.
• I learn from my mistakes. You know what they say about doing the same thing and expecting different results…need we say more?
• I embrace life-long learning and change. The landlording business is always changing and evolving—laws change, tenant’s demands change, the neighborhood where your properties are located change. Landlords must be able to stay on top of new laws and be flexible in their approach. If you think you’re going to buy rentals and do the same exact thing until you retire or die, you’ll be sadly disappointed.
• I’m not obstinate or hard-headed. Great! Because if a landlord decides to draw a line in the sand with the city or with the justice system, things can go south quickly—very quickly.
• I understand that owning rental property is a business. Some folks just never quite figure out that owning rental property isn’t a hobby—but a business. It’s important to take being a rental property owner and manager seriously. Rental investments are a business. Rental properties are not an extension of our private residence—even if we’re house-hacking. Even if you don’t look at it as a business, others will and expect you to act accordingly.

With all that said, not everyone can be all things and none of us are perfect. So, what do you do if you couldn’t answer “that’s me to a tee” for all the above questions? Partner up with someone that has strengths that you don’t have. There are many successful partnerships in the business—often split between spouses. The most important thing is recognizing your weaknesses and getting help with those. Happy Landlording!