Tips for landlords

Updated March 1, 2024  |   Published August 16, 2022

Did you know that 35% of households live in rental properties? Just like a regular home, rental properties need to be insured as well. At WebFirst Insurance, LLC, we want to provide some tips for landlords, and what to keep in mind when shopping around for insurance.

 

 

Three common landlord mistakes to avoid

For most landlords, managing your property is not your full time job. However, with all of the tasks that go into being a landlord, such as screening tenants, maintaining the property, doing renovations, and making sure paperwork is in order, it can be tempting to rush through the small steps that may seem insignificant at first, but could end up costing you down the road. Here are some helpful tips to keep in mind when starting out as a landlord.

Research the rental price before listing.

Decide your rental price and how much profit you want to make off the apartment before you list for tenants. It’ll help determine what kind of tenants you’ll be getting. It’ll also determine how quickly you’re able to rent out the place. Don’t make the mistake of keeping your rental price consistent year after year. Keep these things in mind every year when determining the price of your rental property:

  • Study the rental market. Do a quick search of other units on the market and see how they’re priced. Only compare your price to the price of units in your neighborhood since location is one of the biggest drivers of rent prices. Compare units that provide similar value, such as how updated the appliances are and if they provide similar amenities.
  • Anticipate maintenance and repairs. Make sure the rent amount allows for occasional maintenance costs like plumbing or electrical issues, and takes into consideration more long-term items like appliance and roof replacement or structural repairs. It’s always a good idea to save up some of your rental income on the side for the unexpected problems that are inevitable in a rental property.

Perfect the rental agreement.

Your rental agreement is your guide to how your rental property will be lived in and managed. It’s your opportunity to set rules. A common landlord mistake is not modifying the rental agreement to reflect your own rules. As a landlord, you should research tenant laws to ensure you’re following state and local laws. It’s always a good option to meet with a lawyer for legal counsel as well. Good rental agreements are specific, so don’t be afraid to be specific with your rules.

Enforce (and follow) the rules.

Letting rules slide is a common error to make as a landlord. This reinforces bad behavior and decreases the validity of your rental agreement. Rules about late fees are the most important to follow, because they’re designed to motivate your tenants to pay on time. Tenants are more likely to forget to pay rent if there’s no consequences for being late. Be firm about your late fee rule. It’s also important for the landlord to follow rules on their end; as there are several rules in place to hold the landlord to proper protocols as well. For example, the notice of entry clause specifies how far in advance you should alert tenants that you’ll be entering the rental unit. Make sure you’re also familiar with the Fair Housing Act.

Conducting tenant background checks

Before allowing a tenant to sign a contract and move into your rental property, make sure to conduct a proper background check on them. This includes running a credit check, a check on previous history of living in an apartment, and a check for previous eviction notices. Here are some tips for conducting a proper tenant background check:

  1. Let your tenant(s) know that you’ll be running a background check before they apply. This will help increase credibility and trust between you and the tenant.
  2. Provide the tenant an opportunity to apply either online or on paper. This way you can gather the information you need to run the background check. Usually, it’s easier to apply online, for your convenience, but it’s up to each landlord how they want to do it.
  3. Run the credit check. Use an online service to check the credit of your prospective tenant. Once you enter the email address of your prospective tenant, they will be asked to enter their social security number. From there, you can view their credit score, as well as any red flags, account summaries, and tradelines.
  4. You can also run tenant background checks and view eviction reports. This shows you how your prospective tenant treats society and their neighbors. It also shows how many times they’ve been evicted, as well as the reason for eviction.

 

 

Requiring Rental Insurance from Your Tenants

It is important for a landlord to require renter’s insurance in the contract, because it helps protect both you and your tenants. Here are some benefits of requiring renter’s insurance:

  1. It mitigates the potential threat of a lawsuit
  2. It reduces the landlord’s responsibility
  3. It will help you find tenants that are more responsible
  4. Your deductible is covered
  5. It gives you peace of mind

 

We know that there’s a lot that goes into managing your rental property. Sometimes, purchasing insurance for your rental property ends up on the backburner because there’s so many other things to worry about. Let WebFirst Insurance, LLC, give you the peace of mind you deserve with affordable rental property coverage that fits your needs.

 

 

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