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4 Things Nobody Tells You About Being a Landlord

On paper, it’s the perfect solution. You have some money and you’re looking for somewhere to invest that will earn you a steady stream of passive income to supplement your day wage or even form the foundations of what will someday become a thriving and profitable portfolio. You’re too risk averse to be tempted by the inherent volatility of the stock market. You know that there’s no way you can realistically grow your money by saving alone. So what do you do? You turn to good old bricks and mortar! While property is traditionally regarded (and rightly so) as a prudent investment and while it remains one of the best places to put your money, the life of a landlord isn’t the life of milk and honey that many people (mainly tenants) assume it to be. If you’re looking to grow your money by becoming a landlord there are some things that you should know before you commit to the investment.

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You won’t get rich quick

Ignore all the seminars telling you that you can get rich quick in real estate. You’re unlikely to get rich, and you’re even less likely to get rich quickly. Being a landlord can earn you a sizeable income especially if you have a portfolio of properties, but you also have enormous overheads. As well as the cost of buying and mortgaging your property you’re also responsible for the upkeep of the property. Even if you do your homework on a property (and it goes without saying that you should), there’s really no way to guarantee that your rental property won’t be beset by problems that leech away at the revenue your rent generates or at any emergency funds that you keep on hand.  

You can’t do it alone

Most landlords are resourceful and hardworking people. Many have a background in construction or at least excellent DIY skills. Nonetheless, it’s a fool’s errand to try and tackle the various challenges of being a landlord alone. A big part of what separates a good landlord from the chancers and the amateurs is the ability to reach out to those who can improve your business. This may simply come in the form of reaching out to this company for resources and advice on the complicated craft of being a landlord. It may involve reaching out to a third party property management company or letting agent. Whatever form it takes it’s incumbent upon you to seek advice and make investments if it improves your property and the experience of your tenants.

Your tenants will likely have no idea how hard you work for them

Unfortunate and inaccurate as it may be, your tenants will likely see you as a fat cat preying on their inability to afford their own property and seeking to rip them off at every turn. Unfortunately the malpractices of previous generations of landlords have given landlords a bad name. You can, however, reverse this opinion by politely educating them when their expectations are unreasonable or unrealistic.

The term “Passive income” is colossally misleading!

“Passive income” may not be the most accurate way to describe the lot of a landlord. Even if you have a management company to manage a lot of the logistics for you, you still have a lot of responsibilities. Whether you’re painting, decorating and deep cleaning between tenancies, attending to routine maintenance issues, dealing with tenants in rent arrears or simply worrying about the myriad things that could go wrong when you have comparative strangers living in your property, being a landlord is a 24/7 gig!