More and more people are expanding their real estate portfolio and buying properties for revenue purposes.
The reality of being a landlord can be hard work and may result in property damage from careless tenants but if you connect with the right people, they will treat your home like it is their own.
One thing to consider when buying a home for revenue purposes is positive cash flow, make sure that the income generated by the rental is more than you are putting out every month for mortgage and repair expenses.
As long as you have covered your mortgage and property tax and insurance costs with a little extra to stash away for property maintenance you will have a wonderful start on building some value into your portfolio!
Speaking of maintenance, the biggest mistake I see landlords make is putting carpet into rental properties.
Carpet is inexpensive but the need to replace it more often makes it actually the more expensive option in a rental property.
Hard surface such as vinyl planking and laminate are far better options even though the cost may be more expensive at the outset. Cats cannot scratch and fray laminate and Rover probably won’t ruin a vinyl floor when he has an accident! Most kid damage like crayons and spilled juice will wipe right up from any hard surface while these same scenarios can destroy carpet.
I have been using rubber baseboards commercially for years and then I bought a home that had them installed and I never even noticed!
Rubber base is about $1 a linear foot, is moulded to look like wood and comes in all shades and they NEVER have to be painted!
They can be installed with a sharp knife and a tube of construction adhesive and are absolutely beautiful. This is a perfect product for your rental and you don’t have to worry about tenants banging their vacuums into them or denting them and chipping the paint.
It is a good idea when doing the initial walk-through with tenants that you video tape the entire transaction.
A video of the condition of the home prior to move in removes any doubt if there are discrepancies when the move out is complete and you are returning the damage deposit. You can refer back to your initial walk through video for proof of before rental condition and it is an easy thing to do on your smart phone or ipad.
The rental market is a smart one, real estate is always a good investment and you will enjoy the return on your money in the long term.
Be good to your tenants and give incentives to the ones who stay long term and treat your house well.
A card or gift basket at Christmas goes a long way to saying ‘thank you’ to people who live in your home and who are helping to fund your future. Keep in touch and ask if they need anything to make their stay more pleasurable.
Kim Wyse is a local freelance designer. Find her on facebook at ‘Ask a Designer’.