Hey there! Today I’m sharing some tips at Modest Money on how to tackle debt by boosting your income. I also chatted on Joe’s Stacking Benjamins podcast about retiring abroad, which was a blast even though I’m not a pro like Joe!
So, I own a three-bedroom flat in the UK where I rent out each room to young professionals. Tenants usually stay for about a year before moving on, although I’ve had a couple who stayed for three years, which is perfect for a landlord. Just move them in, collect rent for three years, and you’ll miss them when they leave.
The best part is that in the nearly five years I’ve owned the property, I’ve never had more than a week of vacancy between tenants, all while managing everything from overseas. Even last month, I handled a tenant moving out, found a replacement, and dealt with a broken washing machine. Here are a few tips to help you manage your rental smoothly.
### Set a Fair Price
Everyone wants to make big returns from real estate, but if you price too high, you won’t attract tenants. Price too low, and you’ll get any kind of tenant. Aim for a reasonable price that won’t drive tenants away after a few months because it’s too expensive. Research your competition and test your pricing online, adjusting based on the responses you get.
### Say No
If you don’t have a good feeling about someone, just say no. Getting a deposit and the first month’s rent isn’t worth it if they end up damaging the place. I have my current tenants show the flat to potential roommates and chat with them to ensure they get along. I’d rather wait for the right person, and if my tenants vouch for someone, they share some responsibility if things don’t work out.
### Get Insurance
I previously owned a property in Paris, which was a nightmare. After the tenant passed away, his widow refused to leave or pay rent, and it took 18 months to evict her. Thankfully, I had insurance that covered the rent. Companies like CIA Landlords Insurance can give you peace of mind knowing you’re covered if something happens. If you have contents insurance, make sure your tenants know it doesn’t cover their belongings.
### Automate
All my bills are paid automatically, and my tenants set up automatic transfers for the rent on the first of the month. This way, if I’m traveling or busy, I don’t have to worry about paying bills, and the tenants won’t be without electricity. It simplifies everything.
### Have a Go-To Person
When I moved out of the flat, my old roommates stayed and helped out by forwarding my mail or letting in the plumber when there were issues. It’s crucial to trust your tenants and have a reliable person you can count on. Even though the original roommates have moved out, I still have someone trustworthy. They try to fix problems first before calling me to buy a replacement.
Do you own rental property? Who takes care of it?