BOKISSONTHRONE: 7 Smart Ways to being a good Landlord

Wednesday, October 5, 2016

7 Smart Ways to being a good Landlord

Being a landlord is not for everybody, but in today's rental market, it can be a smart way to grow your wealth. That's because demand for rental units continues to be strong — driven by the failure of wages to keep up with the rising cost of housing.

However, you can still buy rental property and actually make income on it. It should not, therefore, be mistaken for a way to get rich quick. This is a long-term investment that needs to be approached carefully. But if you're still itching to tap your inner real estate baron, here are 7 smart moves to help you get started.

Smart Move 1: Recognize that being a landlord is a business.

Being a landlord is different than being a private homeowner. It's a business, and you need to treat it like one. "Where I see a lot of people make mistakes is, they don't have a good business plan," Roberts a real estate investor says. "This type of investment is not hands-off. It is not just a passive revenue stream. It requires involvement. It requires your time. It requires certain skills."

Any property you buy has to make sense from a business perspective, not because it is a house you would like to live in. That means it should be a reasonably priced home likely to appeal to the kind of tenants you are looking for.

Smart Move 2: Start small.

Roberts suggests starting with a single house or smaller multiple-dwelling unit, perhaps with a partner, to see if the business really suits you.

"Single-family residences are the easiest properties to buy when you are looking for investment property," Merrill says. Condominiums usually require a larger down payment and monthly association fees.

Starting with a single home will allow you to get a feel for the maintenance, bookkeeping and other work required. Roberts and Merrill both recommend choosing an initial property without high-maintenance features such as elaborate landscaping.