Real estate can be a wonderful investment, and a great way to make money. However, there is certainly risk involved. Owning a valuable property is good, but having all of that value tied up in just one investment can be worrying, especially if the property is not properly protected. If you’re considering renting out a property, there are three major dimensions to consider: maintenance, insurance coverage, and your tenants.
Let’s start with the obvious: a well-kept property needs maintenance. That means preventative maintenance and regular checks on the systems that make your property comfortable and functional. It also means quick repairs on any issues that may arise. Putting off maintenance or repairs will only make problems worse. You’ll need to develop a regular schedule of maintenance and repair visits. This is only made more important by the fact that you are not living there, where you can personally spot potential issues. Make a schedule and automate the process as much as possible, so that you don’t miss key check-ups.
Even a great maintenance and repair schedule is not a guarantee of a property’s well-being. Disaster can still rob you of your valuable property. A fire can damage or destroy it, burst pipes can flood it, and criminals can break into it or vandalize it. You can’t prepare for everything, but you would be wise to get insurance that covers all of the most common problems faced by properties in the same area. Keep in mind that you may need special insurance, such as landlord insurance, because of the fact that your space will have a tenant, or multiple tenants.
Speaking of tenants, they are the final part of this equation, and they’re extremely important. When it comes to a rental property, the quality of the tenant or tenants is one of the single biggest risk factors. A bad tenant can do serious damage to your property. From parties and vandalism to simple neglect, there’s a lot that a malicious or inept tenant can do to cut into your property’s value.
Plus, bad tenants can hit your bottom line by simply failing to pay rent. Kicking out a deadbeat tenant is costly and difficult in most areas, and it’s never ideal. One of the most important things you can do to protect your space is to property check out your tenants before signing the lease agreement. There are ways to make this easier, including working with real estate agents and using free tenant screening software, so make sure that you do it!
Owning a valuable property is great, and it’s exciting if it may be able to generate income for you. If you take care of the concerns covered here, you should be able to rest easy. Good luck!