Starting out as a landlord can be a daunting challenge, as there are so many possible things that can go wrong when you are working, especially if you are unprepared. Even the most well-trained landlord will inevitably encounter a few situations that they weren’t expecting. Yet educating yourself on some of the most commonly made mistakes and the most recommended practices can help to elevate the confusion that comes with the job. With that in mind, consider these 10 helpful tips for first-time landlords!
- Clearly Define Terms of Lease & Rental Contracts
Your Lease Agreement is an official agreement between a landlord and tenant that maps out the rules for occupying a property for a certain period of time, usually six months to a year. Rental Contracts also include various terms and conditions that go along with the Lease, covering everything from rent amounts and requirements surrounding security deposits to maintenance responsibilities and whether pets are allowed on the property. These rules are important for keeping your property running smoothly, so be sure the terms are clearly laid out and readily available.
- Screen Tenants Effectively
The act of screening your tenants is one of the most parts of being a landlord, as doing it effectively will ultimately cut down on a lot of frustration down the line. Establish clear standards for screening applicants, including running credit checks, background checks, and contact previous landlords or property managers. Smart screening strategies are one of the most important ways to mitigate liability as a property manager or landlord.
- Get a Security Deposit
Some tenants can be somewhat careless about how well they take care of a property they are staying in. By collecting a security deposit, you are telling your new tenant that you care about the condition of the property and how well they take care of it while they are staying there. Additionally, if they don’t keep the property in good condition or damage in some way, you may be able to keep some or all of the deposit to cover repairs or cleaning costs.
- Choose Your Investors Wisely
As with any business partner, your investors should be people who are honest, transparent, and communicate effectively. Don’t simply partner up with the first person who makes a good offer. Be more selective, looking for someone who you could see yourself working with over a long period of time.
- Make Smart Renovation Choices
Whether you are addressing tenant problems or just aiming to expand upon your existing properties, you will inevitably end up investing in renovations and repairs over time. Yet while repairs are a necessity, it is important to reserve renovations for situations that will result in higher rent, otherwise you run the risk of pumping money into a property without receiving an adequate return on your investment. Under-renovating reflects poorly on a landlord, but over-renovating can be a serious financial drain.
- Keep Up-To-Date Records
Management consultant Peter Drucker is often attributed as saying, “What gets measured gets improved.” With this in mind, it is absolutely vital that keep in-depth and up-to-date records on all major aspects of your business. From records of revenue and expenses to written contracts for official client agreements, keep your business information updated and organized. You might not be able to measure everything, but just measuring what you can go a long way.
- Be Transparent With Tenants
What cannot be solved by measurement can often be dealt with (or at least mitigated by) clear communication and honesty with your tenants. Some landlords have a bad habit of keeping renters in the dark about terms or conditions, with some even resorting to false advertising. This kind of behavior erodes goodwill and makes prospective tenants leery. Ideally, you should be setting the right expectations from the start, being open to renter’s questions and making sure that all property specs or lease terms are accurate.
- Show Tenants Empathy & Respect
While you need to be firm about rent deadlines and make sure that tenants are keeping up their side of the renter’s agreement, remember that you are dealing with people here and you should treat them with a basic level of respect. Tenants can often be nervous about their relationship with landlords, as they sometimes feel like they are at their mercy. Do your part to ease these concerns: be understanding and respectful of their time, avoiding unannounced drop-ins, rent hikes, or shutting off utilities. Give plenty of notice ahead of schedule, especially if prices are expected to change. Most importantly, do not resort to negativity or insults, even if a tenant is causing problems.
- Understand Your Rights & Responsibilities
No matter what your situation is, your tenants have certain rights that you must consistently meet. For instance: you must ensure that your properties are as possible and that you do not discriminate against tenants as discussed in the Fair Housing Act. At the same time, you have your own legal rights as well, and so long as they do not infringe upon your tenant’s rights, you should exercise them and protect them. If you are a first-time landlord, be sure to read a landlord guide and have a thorough understanding of both your responsibilities and rights.
- Know Your Local Housing Laws
Every state has its own unique housing laws, and many cities and counties will also have specific requirements that must be fulfilled as well. There is no good reason for you to not be educated on the laws that govern the real estate industry, so be sure to do your research. Even if you have a good sense of general real estate law, there might be some local requirements that you aren’t aware of that could complicate your business.
Of course, if you need further insights into your area’s real estate laws or would like some additional legal guidance as a landlord, consider reaching out to CCSK Law. Our professional team is well-versed in the ins and outs of local real estate and entrepreneurship, offering the kind of in-depth legal knowledge that can help landlords and other real estate pros find success!
 NOLO. (2012, March 19). Understanding Leases and Rental Agreement Contracts. Landlord Tenant Law Firms published by NOLO. Retrieved from https://www.landlordtenantlawfirms.com/resources/landlord-and-tenant/leases-and-rental-agreements/understanding-rental-agreement-contract.htm
 Moussa, C. E. (2015, October 19). 5 Rental Home Renovations That Are Worth Your Money. Landlordology Retrieved from https://www.landlordology.com/5-renovations-christina-el-moussa/
 Zak, P. (2014, July 4). Measurement Myopia. Drucker Institute. Retrieved from https://www.drucker.institute/thedx/measurement-myopia/
 Welles, H. (2020, January 17). How to Overcome Communication Barriers as a Landlord. Rentec Direct. Retrieved from https://www.rentecdirect.com/blog/overcome-communication-barriers-as-a-landlord/
 Eberlin, E. (2020, February 1). How the Fair Housing Act Prevents Discrimination. The Balance. Retrieved from https://www.thebalancesmb.com/what-is-the-federal-fair-housing-act-2125014