Becoming an accidental landlord can be a scary situation. If you've never owned a property before, how are you supposed to know what to do?
It's completely understandable to be a little intimidated. Luckily, there's plenty of information out there to help you out.
Read on for the tips accidental landlords need to know.
1. Know the Local Laws and Regulations
When you're new to being a landlord, it's important to inform yourself about the law.
Pleasanton has specific rent control regulations that landlords need to be aware of. Familiarize yourself with the allowable rent increases and understand the rules surrounding just cause eviction. Keep an eye out for any changes to these rental regulations.
Different types of landlords may need to know about different laws. Commercial and residential properties might have different regulations.
Respect tenant privacy rights. Ensure that you provide proper notice before entering the rental property for inspections or repairs, as required by local regulations.
2. Screen Your Tenants
You want to be very careful about who you're letting live in your properties.
Define specific criteria for potential tenants, including a minimum credit score, income requirements, rental history, and any other factors. Having clear criteria helps streamline the screening process.
Conduct thorough background checks. These should include criminal history, eviction history, and credit checks. Use reputable tenant screening services to obtain up-to-date information.
Pay attention to your instincts and gut feelings during the screening process. If something feels off or if you have reservations about a potential tenant, consider exploring other options.
3. Plan for the Future
As a beginner landlord, you need to ensure that you're setting yourself up right.
Create a detailed budget. Go through all expenses related to your rental property, including any mortgage payments, relevant taxes, insurance, maintenance costs, and property management fees. This will help you understand your financial commitments.
Build and maintain an emergency fund specifically for your rental property. Aim to set aside three to six months' worth of expenses to cover unforeseen repairs, vacancies, or other financial setbacks.
Consider diversifying your new investment portfolio to reduce risk. Relying solely on rental income may expose you to fluctuations in the real estate market, so explore other investment options for a well-rounded financial strategy.
4. Get Help
When you're becoming a landlord, it's important to keep in mind that you don't have to do everything all by yourself.
Think about bringing in a professional Pleasanton property management company. They can handle tasks such as tenant screening, rent collection, property maintenance, and legal compliance, allowing you to focus on other aspects of your life.
Work with a real estate tax professional to optimize your tax strategy. Identify eligible tax deductions, depreciation, and other benefits associated with owning a rental property.
Accidental Landlords: Prepare Yourself Today
Accidental landlords have a lot to learn. Hopefully, with these tips, you'll start to understand how to be a good landlord in California.
Do you need more help on your journey to become a successful landlord in Pleasanton? Advantage Property Management Services has been serving and advocating for landlords for over a decade.
Contact us today to get started.