Rental Ownership Woes
While real estate investing is a great line of business to get into
in order to make copious piles of money there are a few things to
consider before jumping into the fray. This is particularly true if you
are considering going the route of a rental property owner. There are
all kinds of reasons that this is a good solid investment for most that
are interested in investing in the real estate business however, it
doesn't come without a few drawbacks, not all of which are financial. It
would be wise to consider these things however before you buy your
first rental property.
First of all, if you own rental properties
and elect to manage them yourself, which is probably wise unless your
first property is a multiple rental unit, you will quickly discover that
your life is no longer your own. You are literally on call 24 hours a
day 7 days a week to handle problems that may arise from pipes bursting,
heating going out, electric issues, noxious fumes, leaky roofs and
window sills and countless other complaints that may erupt at odd hours
of the day or night. Your tenants will have your phone number and expect
you to always take their calls.
Second, you have to play the
role of Mr. or Mrs. Mean every month when the rent is due. This is
probably the least tasteful task of owning rental properties for many rental property owners and one reason that many resort to the services of a property management agency
above all other reasons. You will hear all manner of sob stories in
your role as landlord but you need to treat this like the business even
the things about your business you don't like such as rent collecting
and, when necessary, eviction proceedings.
Third, the constant
need for upkeep and repair is often daunting to rental property owners.
It's a sad truth that people do not treat rental properties with the
respect that they would treat a home of their own. For this reason you
almost always need to paint and replace carpeting, at the very least in
between tenants. This takes works and time not to mention the fact that
the time that is spent painting and replacing the flooring is time that
the property is going to be empty of tenants and not bringing in any
income.
Finally, there is the constant need to have the property
occupied. As the owner of a rental property you will need to find new
tenants when the old ones leave because every day the property is empty
is a day you aren't making money. You want to have the property filled
as often as possible and you really want long term tenants whenever you
can manage that. One way of course is by making sure that your tenants
are treated well, not overcharged, and happy with their homes.
Owning
rental property can be financially rewarding but it is a lot more work
than many people give it credit for being in light of other careers
within the real estate investment field that may require more work
upfront. Rental properties require a long-term commitment to keeping the
property in good working order and making it a profitable venture for
many years to come. If you are considering this business and the above
things are a deterrent for you it might be a good idea to obtain the
services of a property manager.