Often a time people find landlords and landladies annoying. Unending calls and visits to a tenants house at the end of each month is what best describes them.
But people fail to understand that the hassles that come with managing property and keeping tenants happy may take a toll on someone who has thick skin.
Investing in real estate has become increasingly popular over the last 50 years and has become a common investment vehicle. Investing in a tangible asset like real estate may seem to offer a greater sense of control. This feels somehow safer than subjecting your savings to the whims of the stock market.
The real estate business in Kenya is becoming popular; many people are now investing in building rental properties.
Owning rental properties can be the key to a great deal of profit and financial freedom if one does things the right way from the start or at least learn from your mistakes and that of the others along the way.
According to an article by Angela Colley, the following are the issues with becoming a landlord;
Startup capital; all potential landlord consider the cost of purchasing an investment property, but many overlook the cost to remodel. Don’t expect startup cost to end at the closing of the deal. Remodeling to your own code can be costly.
Making repairs; when it comes to being a landlord, two things in life are inevitable: death and repairs. Never consider the real estate business unless you are ready to pay for repairs. The landlord and tenant law requires that you make serious repairs quickly, if not you are liable for additional damages. Major problems aren’t the only issue you’ll have to account for. Some tenants will call you for every little thing. Be ready to spend your free time changing light bulbs, and weeding yards.
Collecting rent; you’ll have tenants who pay on time, tenants who will slip up but will always let you know and then you’ll have tenants that don’t pay and don’t call. As a landlord, you’ll have to play bill collector from time to time. Are you comfortable confronting your tenants before you start renting?
Dealing with problem tenants; most of your tenants will pay the rent, treat the property like their own and keep the neighbors happy. But at some point, you’ll inevitably have a problem tenant. If you are going to be a landlord, you have to handle tenants fighting, doing damage to your investment and those who don’t pay.
Surviving evictions; in reality, evictions are often expensive and time-consuming. Even if you evict a tenant successfully, you will have likely incurred major expenses and lost significant time in the process.
Managing your finances; a landlord’s finances do not stay constant. If you can learn to go with the flow, and plan for the unexpected, you just might survive.
Keeping your property safe; by maintaining and keeping it in good working order to avoid contributing to potential mishaps.
Paying taxes; one thing that you can’t overlook is taxes. Renting property is a business and so you’ll have to report the income you can earn when you file your taxes every year.
When investing in rental houses, just be aware that being a landlord is not all fun and games. You have to work hard for your money and may be faced with adversity from time to time. investing in rental property is not for everyone. It is an investment option to consider once you have achieved a certain level of financial independence.