It is time to join the growing ranks of accidental landlords. Perhaps you inherited the property. Or you could be unwilling to give up your ultra-low interest rate.
Whatever the reason, becoming an accidental landlord can potentially grow your wealth and increase your financial freedom. However, you must avoid common mistakes and pitfalls to make the most of your new role. These four tips will help you make the most of becoming an accidental landlord.
1. Create a Maintenance Plan
One of the first things accidental landlords in Minneapolis should do is create a maintenance plan. There are two reasons for this. The first is that you now own investment real estate.
Having a maintenance plan helps you protect the value of the real estate, thereby protecting the long-term value growth of the investment.
A maintenance plan must also comply with Minnesota landlord/tenant law. The landlord is responsible for maintaining a safe and habitable property. This means keeping the property "fit to live" by complying with local health and housing codes.
2. Hire a Property Manager
Becoming an accidental landlord is often a sudden and unexpected experience. Because of this, you do not have time to prepare. This makes your new role overwhelming and wrought with potential pitfalls.
Hiring a Minneapolis property management company is a smart option for novice landlords. It allows you to become a hands-free landlord, as the property manager handles the day-to-day management.
A property manager can handle marketing, tenant screening, maintenance, rent collection, and eviction proceedings.
3. Create a Tenant Screening Process
Whether you currently have a tenant living in the property or need to find one, you must create a tenant screening process before accepting tenant applications. Working with property managers in Minneapolis can assist with this.
The screening process you have in place will need to identify potential red flags effectively. That way, you can avoid potentially problematic tenants.
You must also comply with Minnesota Fair Housing laws. These laws protect applicants and tenants who are in protected groups from discrimination. Be careful; discrimination is not always obvious or intentional.
4. Buy Insurance Policies
As a new property owner, you must protect yourself and your assets. You will need to buy property insurance. This insurance covers damages that happen to the property.
You may also want to buy landlord insurance. It will protect you from liability if someone gets injured on the property. Additional insurance policies can protect you from rental income losses.
Property Managers Can Help Accidental Landlords
Accidental landlords face many challenges in their new role. The best approach is to identify potential pitfalls and then plan to avoid them.
A maintenance plan protects your liability and property value. A tenant screening process ensures you find high-quality tenants while complying with fair housing laws.
Working with a property management team like those from 33rd Company Property Management provides a valuable resource. As experienced property management in Minneapolis, we guide new landlords on the laws and best practices for success.
Gain confidence as an accidental landlord with an experienced team from 33rd Company Property Management to support you.