Executive Housing Consultants, Inc.
Executive Housing Consultants, Inc, Executive Housing Consultants, Inc.
Email: [email protected]

8 Tips for Buying Your First Rental Property

by Executive Housing Consultants, Inc 11/17/2020

Photo by Tumisu via Pixabay

Maybe you’ve thought about buying rental property. Wouldn’t it be great, you think, to own something that someone else pays for? It can work out that way, with your property increasing in value while you pocket money every month. But with the wrong home, the wrong tenants or the wrong management, it can go horrendously sour. Here are eight ways to make your first venture as a landlord a successful one.

  1. Start small. Buy a single house, townhouse or condo rather than an entire apartment building.

  2. Decide how much work you’ll take on. Are you a DIYer? Can you make minor repairs yourself? Are you willing and able to recruit tenants and deal with them on an ongoing basis? If this isn’t you, you’ll be wise to hire a property management company to handle these items.

  3. Really, really, understand your income and expenses. Project them forward 5 to 10 years and make sure you have a margin. There’s more than mortgage, taxes, insurance and utilities. There also can be landscaping, pest control, landlord insurance and minor repairs. Be especially aware of big ticket items. If you’ll need a new roof eight years from now, set aside for it. Be aware of property tax trends so you won’t be caught be surprise. Consider what will happen if a tenant leaves and your property is vacant for several months.

  4. Arrange financing in advance. Most mortgage lenders will pre-qualify your loan. It helps close the deal if you can show this to a buyer.

  5. Know the neighborhood. If you’re not familiar with it, drive around. Talk to people. Research it online.

  6. Learn how to be a landlord. Talk to other landlords. Join a landlord’s association. Familiarize yourself with tenant rights and local regulations.

  7. Know your tenants. The right tenants can make your experience a joy and the wrong ones can make you rue the day you got into this business. Use a screening service. Have a written lease ready to go and specify exactly what is expected: when the rent is due, what the grace period is, what’s the penalty for being late, who pays utilities, what - if any - maintenance the renters are required to do. Insist on prompt rent payment right from the get-go. No matter how much you like your tenants, it's imperative to keep the relationship professional. Visit your property from time to time. You’re not permitted to barge in, but a drive-by can tell you a lot.

  8. Keep business and personal finances separated. Maintain separate bank accounts and credit cards. Be clear on which is which for record keeping and tax accounting.

People have put children through college and financed their retirement through rental property while also working at paycheck jobs. But being a landlord is not for the timid, the inflexible or the careless planners. Think before you make the leap, and if you decide to go for it, all the best!

About the Author
Author

Executive Housing Consultants, Inc

Executive Housing Consultants, Inc. is the residential real estate company specializing in the rental and management of luxury properties in the Washington Metro area. This includes Chevy Chase, Bethesda, Potomac and North Potomac, Maryland, Upper Northwest Washington, DC, and McLean, Arlington and Great Falls, Virginia. Executive Housing Consultants was founded in 1983 to provide exceptional service and management of high-end rental housing. Our founders, Libbie Mathes and Rochelle Scissors, traveled the world and were disappointed with their experiences with the leasing and management of their homes in the Washington area while abroad. They recognized the need for a well-run, property management company. Libbie and Rochelle believed they could manage and run a rental real estate firm more efficiently than any of the companies they had dealt with during their time away. They also discovered the need for quality temporary housing in Washington. So they created our short-term furnished portfolio to serve those visiting Washington for a temporary stay and those relocating to the area that need a furnished property while they looked for a permanent housing solution. In 1997, Brian Ridgway took over Executive Housing Consultants and has continued our strong reputation of offering high-quality, upscale temporary and long-term rental real estate. Mission Statement Executive Housing Consultants Inc. is a leader in providing luxury temporary housing to our clients in the Washington Metro area. Our pledge is to offer exceptional housing and superior service while maintaining the highest level of integrity and strict ethical values. In addition, we promise to: Be loyal to our clients. Protect our clients’ interests in all matters. Promptly and diligently respond to our clients’ needs and the needs of their properties. Remain the experts in our industry. Why Are We Unique? We are truly the experts in this industry. Leasing and managing rental properties in the Washington Metro area is our niche; it is ALL we do. We offer unparalleled expertise, service, and value to our clients. In addition: Our contact and referral network is vast. We set the standard for world-class service in our industry. We are your link to success, whatever your residential rental needs maybe. Our clients own some of the most valuable real estate in the Metropolitan Washington, D.C. area. Contact Executive Housing Consultants Inc. for more info! Phone: (301)951-4111 | Email: [email protected]