The Top 12 Things I’ve Learned From 12 Years as a Landlord

28

Being a landlord for a dozen years teaches you a thing or two about the business and the human condition. It is certainly true that there is no better teacher than experience. You meet so many different people in this business. Some want to pay you money, others want you to pay them money and some want to scam your money away from you.

You have to learn how to deal with them all. You have to learn little things to make your life run more easily and your business tick more smoothly. You also have to learn ways to avoid being scammed. Sometimes things are learned the hard way, other times not. Here’s to hoping that you can learn from my experience and avoid learning the hard way.

Download Your FREE copy of ‘How to Rent Your House!

Renting your house is a great way to enter the world of real estate investing, but most first-timers (understandably) have a lot of questions. Fortunately, the experts at BiggerPockets have put together a complimentary guide on ‘How to Rent Your House’. All the skills, tools, and confidence you need to successfully rent your house are just a mouse-click away.

Click Here For Your Free Guide to Renting Your House

The Top 12 Things I’ve Learned From 12 Years as a Landlord

1. Call the Main Business Line to Check References

If a potential tenant lists a reference and provides a phone number, if it is at all possible call a main business number and get transferred to the reference. For example, if a tenant says Mr. X can verify employment at Autozone, call the main number for the store or office and get transferred to Mr. X. You never know if the number you were provided will just connect you to a friend who is part of the scam. People lie, and you do not want to be duped by the likes of Vandelay Industries.

2. Don’t Trust Pay Stubs (or Business Letterhead Either)

Take a look at this website. Pay stubs and other work related documents can and are faked. It happens more than you think. The moral to this story is to verify everything. Do not take anything on face value.

3. Use Your Smart Phone More Smartly

Put your tenants’ names in your phone’s contact list, but list them by apartment first rather than by name first. This will allow you to more easily identify who is calling and provide better service. So, for example, instead of Jennifer Tenant, list the contact as 123 Main Jennifer Tenant. Tenants come and go, and how many Johns and Jennifers do you know? It can potentially get confusing, especially as you acquire properties and more tenants.

Related: 7 Types of Tenants Who Cause MAJOR Landlord Headaches

4. Take Advantage of Video Capability

Use your smart phone to take a video of your property during a tenant’s move in and have them appear in the video. Not only will you have a great record of the condition of the property, but you will have evidence that the tenant was aware of the conditions when they moved in. It is pretty hard to convince a judge otherwise when they are shown in the video.

5. Build a Professional-Looking and Functional Website

Quality tenants are attracted to a professional-looking website. Plus, you can eliminate a lot of paper and busy work if your website allows tenants to apply for apartments and pay rent online. Make it easy for your tenants to find you, see what you have available, apply for your rentals and pay for them.

6. Hire Help Now

Do not wait to do this. You need help — be it a secretary, contractor, property manager, whatever — to give you the time to think about and work on your business rather than in it.

7. Get Rid of the “For Rent” Signs

Almost everything is electronic now (see “build a professional website” above). Use Craigslist and backpage.com to advertise your rental properties. There are all sorts of websites out there that will help you create nice-looking ads. Signs tell crooks your house is vacant and in my experience bring out the worst sort of applicants. If you can, ditch the signs.

8. Define “Emergency” Up Front

What an emergency is to you may not be the same to your tenants. Do you really want a call at 4 a.m. because of a drip under the kitchen sink? No, I do not think you do. Make sure you spell out exactly what an emergency is and place it in your lease. Otherwise, everything can become an emergency.

9. Use Texting as Much as Possible

It is just easier and less time-consuming to text rather than talk. If you get a call, try texting back to the person that you are in a meeting and ask if they could please text you their concern. Then respond promptly, and folks will learn that texting is the best method of communication.

Related: 11 Things Landlords Should Be Doing Every Year… But Probably Aren’t

10. Use a Changeable Cylinder System for Locks

I switched over to the Landlord Locks system several years ago. With this system, to re-key a property, you simply change the cylinder instead of the entire lock. This saves a ton of time and frustration. There are several differing types of lock systems. Check them out and pick one that fits your needs.

11. Place a Key Box on All Properties

Having key boxes is a great time saver. No longer do I have to run around and open up properties to allow trusted contractors in for a repair. Plus, if I am out of town and a tenant locks themselves out, I can always give them the key box code and change it later when I return. This is an awesome time saver.

12. Show Your Tenants How to Flip a Breaker

Believe it or not, many tenants have no idea how or are scared to do this, especially the younger ones. Showing them how to flip a tripped breaker upon move in can really save you some phone calls and hassle — and possibly your property. Don’t stop with just a tripped breaker, but also show them how to work water and gas cutoff valves. Now, if a breaker trips they can turn it back on without calling you. If a leak starts, they can stop it before more damage is caused. If they smell gas, they can turn off the source.

So there you have them — a dozen tips from a dozen years in the business.

What would you add to the list?

Please share with your comments!

About Author

Kevin Perk

Kevin Perk is co-founder of Kevron Properties, LLC with his wife Terron and has been involved in real estate investing for 10 years. Kevin invests in and manages rental properties in Memphis, TN and is a past president and vice-president of the local REIA group, the Memphis Investors Group.

28 Comments

  1. Alex Craig

    Do you get any push back on # 4? I can see people having a problem with this, but I think it is a great idea.

    Totally agree on # 7. We have a spot on our application that says “how did you find us?” 85% say Internet with craigslist and zillow being the most frequent site referred.

    • Kevin Perk

      Alex,

      Not at all. Some try to jump out of the way, many times that is simply a natural reaction, other times we counter with “What’s the problem, are you planning on destroying the property?” So do it!

      I think signs are a relic of the past, even in lower income areas. Everyone has a smart phone of some type these days. Having a sign, especially a generic one from Home Depot, screams little, inexperienced landlord who is ready to be scammed.

      Thanks as always for the comment,

      Kevin

  2. Kevin,

    You are one of my favorite BP bloggers!

    Vandelay Industries…haha!

    #3 Use your smartphone more smartly…yes, this is a very good point! I have done this and turned my smartphone capabilities into a rental business managing tool that is well worth the $50.00 I pay per month.

    #9 Use Texting as much as possible…this one I would add some caution. Millennials really only want to text. I am cautious because they will want to have entire discussions via text. What I do is write a concise email and then send a text telling them that I sent them an email. This of course is only for more involved conversations that would otherwise be 10+ text messages. This way, I have concise documentation that I can easily print out if need be.

  3. Elizabeth J.

    Wonderful points! Wondered if you found any particular type of software especially helpful in running the management of the building. I am looking to purchase a 6 unit building that I want to manage myself (with the right people in place, of course, to handle repairs, maintenance, etc.) and found one that looks pretty promising, but I wondered if you had tips in this regard as to what features have been most helpful. Also, have you found that when you made improvements to units, you attracted a better renter pool? The building that I am considering needs a number of cosmetic fixes, especially the kitchens in some of the units. The rents are currently quite low for those units, but I think that is in large part due to the crummy product that the renters are getting. Thank you!

    • Kevin Perk

      Elizabeth,

      We use Appfolio as our management software. It might be a bit pricy if you only have a few doors. There are other tools out there like Buildium and Yardi. Check these out and see if they might work for you.

      Personally, I would make as many improvements as you can afford. I recently did a podcast on my blog with an apartment broker here in Memphis who explained that he was seeing the greatest rewards going to those who did the best rehab jobs. Tenants are in effect voting with their dollars and going to the nicer places and staying put. That said every market is different, but I think in today’s climate you will reap the returns if you go the extra mile with a rehab.

      Thanks for the comment and the kind words,

      Kevin

    • Gregory Hiban

      I think his main point here is that you no longer have to take the risk associated with physical signs given that the size of the online marketplace has hit critical mass in the rentals space. If a few teens break into one place due to the signage, they could easily do $10K worth of damage.

    • Kevin Perk

      Kevin,

      Signs do still work, especially if you use customized signs as opposed to the generic home depot ones. In fact in some neighborhoods, you may still get better results from signs, but I think overall their effect is fading fast.

      I don’t like them because they advertise the vacancy to everyone and they tend to , in my experience, attract a lower quality of applicant.

      Thanks for the comment though. You do bring up a good point about signs. If you use them, get some customized ones and be sure you know your local laws.

      Thanks for commenting and adding to the discussion,

      Kevin

      • Bob Hucker

        Signs don’t work as well as online listings, but one of my best tenants saw my sign when she was riding around with a real-estate agent to see some rentals on the MLS. She was smart enough to write down my phone number and call later, avoiding the complication of having the agent call me and want a commission.

        Also, a sign does not necessarily indicate that the property is vacant. Following the pattern of big apartment complexes, I require a 60-day termination notice from my tenants, allowing time to advertise the property before they leave and allowing time to acquire tenants who have to give a long notice to their apartment landlords.

  4. Evelyn Jordan

    Great article, Kevin! Thank you for sharing invaluable information from your personal experience. I like your advice on smart devices and how we should use them more often – I always take pictures of everything in my properties but haven’t thought of making a video with the tenant in it instead! Educating your tenants upfront about certain things at the property is very important too – saves you tons of trouble. I have heard that the new Kwikset E-key lock is great and allows you to be hands-off and control access to your property from long distance. Haven’t used it yet, but they say it’s worth the money (http://www.kwikset.com/Kevo/Default.aspx#.VO0N2vnF98E).

    Looking forward to reading your next article!
    Evelyn

Leave A Reply

Pair a profile with your post!

Create a Free Account

Or,


Log In Here

css.php