Tired Of Being A Landlord? Here’s What To Do Next.

Being a landlord isn’t a hobby—it’s a business.

It can be both lucrative and a major headache. The monetary benefits, tax deductions, and asset appreciation for an investment property are on the whole, significant advantages. Be that as it may, managing bad tenants, vacancies, significant repairs, turnovers, and untrustworthy people isn’t just exhausting, it’s costly. Beyond committing time and resources into your investment property, you must also become well versed in your state and local laws to avoid potential lawsuits. The following are six reasons being a landlord can be a headache and what to do about each.

1. Costly renovations

As properties age, they need more upkeep and support. What’s more, sooner or later every house needs a significant upgrade and remodel. There could be plumbing issues or leaking roofs that you need to deal with. Natural disasters can hit and you might be confronted with a property that has major fire or water damage. Dealing with large repairs can take a toll on you, and affect your bottom line cash flow. Out of nowhere your investment seems like a sinking ship.

What to do about it: Truly investigate your operational overhead. What was your total carrying cost for the past few years, including all maintenance, and how much rental income did the property make? If expenses are more than revenues during this time, only a massive, forced appreciation of the property’s value may be able to offset your loss. Consider whether it might be worth it to sell the house and use your net proceeds in a more beneficial investment.

2. Tenant Issues

Being a landlord implies managing, and dealing with all sorts of tenants. In a perfect world, you have great tenants who require minimal attention. In any case, just one bad tenant can be a nightmare for even the most patient landlord. Just some examples might be that the rent is always late (or fails to be delivered at all), or the house is trashed and continually damaged. Managing this kind of tenant can lead to lawyers and having to process evictions with the city just to recover your cash flow. Additionally, there could be tenant disputes and noise complaints to have to deal with, and that make your job difficult.

What to do about it: Are the financial benefits you get as a landlord worth the stress of dealing with tenants? Landlords today can easily communicate with their tenants through technology and collect rent via online, but only to a certain point. Evaluate whether you can resolve tenant issues while continuing to be a landlord, or whether they are an unavoidable constant of the job. If the latter, you might consider selling the property and escaping the property management business.

3. Staying Informed

Before becoming a landlord you may have longed for kicking back, relaxing and collecting rent checks. Be that as it may, you might now realize it’s not just that easy. You need to remain educated and remain up-to-date on all property legislation and laws pertaining to landlords. You need to know about any state or government policies that could affect you, so you can limit your risk of lawsuits or fines. All of this requires some investment of time and effort.

What to do about it: There is no simple method to get around this: if you want to be a viable landlord, you need to be educated. Fortunately, there are a ton of incredible online resources to keep you in the know. Most importantly, focus on the market where the property is located. If the area is going downhill, no amount of information will help you avoid the negative impact this could have on your business. Monitor the national housing market too, as it can signal rent and housing price changes forecasted for the future.

4. Time Commitment

Maybe you wanted to become a landlord because you thought it was an ideal way to spend your retirement. Easy money right? Think again. Being a good, cash flowing landlord requires time commitment, and it’s generally not on your time. Tenant issues can arise whenever. If you don’t have a property manager, who’s getting the call at 3 a.m. when there’s an emergency? That’s right, you.

In addition, if you want to avoid potentially bad tenants you have to make the time to screen them properly and do your due diligence. When there’s a vacancy, you have to take time to market the property, and respond to all the requests that come through, as well as perform tours. All of these things can intrude on your spare time and can require an enormous investment of the time you do have. We all know this, time is a limited asset — one that you can’t get back, so ask yourself how much time are you truly spending on all of this and is it worth it?

What to do about it: Consider hiring a property management company. They can take on the role of intermediary between you and the tenant, while also managing the day-to-day issues of your property.  Unfortunately, property management companies aren’t cheap. You will need to determine if the cost merits the financial trade off.

5. Managing Difficult Situations 

As a landlord, it’s not an ‘in the event that’ you should manage troublesome circumstances, it’s when. No landlord is safe from troubles. There can be tenant disputes that you have to resolve. You will most likely have to be the bad guy and tell a tenant something they don’t want to hear. Worse yet, you may have to evict someone, which is unpleasant. You must be able to withstand a great deal of these challenges to be a successful landlord. However, sooner or later you may become worn out on continually putting out fires.

What to do about it: As referenced above, you could consider utilizing a property management company to remove difficult situations off your plate, but it will come at a cost to your bottom line. You could likewise utilize a tenant management platform, but this will furthermore take money and time to learn. It also won’t completely eliminate dealing with certain difficult situations. You can however, avoid certain circumstances by improving tenant screening and shoring up your policies in writing. Regardless of what actions you take, dealing with these problems just come with the territory of managing rentals.

6. Location 

Where you are a landlord also matters. Neighborhoods are always changing, and if you’re in a hot area now, in a couple of years, it might not be anymore. Focus on what’s happening in your market. On the off chance that market conditions head downhill, even the most experienced landlord might be in for a tough time.

What to do about it: Watch national and local real estate trends for indications of a downturn. It could be an ideal opportunity to trade out your rental and utilize your potential benefit by buying up property in an alternate state.

The Good News? You Have Options.

Obviously, if your property is in good condition, could work with a realtor. But finding a good agent can be hard, and realtor fees can set you back 6% of the purchase price.

If your property isn’t in the best condition however, you might have to fully remodel it to bring it up to market value, or instead, be forced to sell it at a deep discount.

Rather than dealing with all  that, Nexus Property Solutions, LLC is here to assist you with getting the best return on your property. In our business model, the seller comes first, and we want to provide you the best value. To help relieve your stress as a landlord, we purchase your trouble property AS-IS, and offer quick cash closings. Just fill out your info here.