If you’re a first-time landlord, you probably have a few questions.
- What is the best protection for my property?
- How much do I need to spend to get started?
- How do I screen tenants so they’ll pay on time?
- How can I reduce the chance of having a bad renter?
All of these questions are important to consider when deciding to become a landlord. However, one of the most important things to consider is whether you should include a restriction on pets in your tenancy agreement. The pros and cons of doing so are important to know if you are a first-time landlord.
Here are some pros and cons to consider if you are planning on becoming a first-time landlord.
Pros to Consider if You are a First-Time Landlord
An Extra Source of Income
If you decide to get involved with renting, you will create an extra source of income. This is a good way to help cover any unexpected costs that you may come across.
If you rent out your property, it can help you reduce or eliminate taxes you may have otherwise. This will only happen if you rent out a full-time property, and you will have to keep careful records of how much your property is being used.
Renters are more likely to ask about pet policies before agreeing to pay for your property. That said, we know a lot of renters are pet owners, and a new study from the Association of Fundraising Professionals (AFP) confirms what many of us already suspected: renters with pets pay more for their rent than those without.
Cons to Consider if You are a First-Time Landlord
Maintenance and repairs
As a landlord, you’ll be responsible for most maintenance and repairs. This will involve maintaining and repairing the appliances, fixing and maintaining the property, and repairing and replacing the plumbing and electrical systems.
In addition to these basic fixes, you may also have to make a few home improvements as well. As a new landlord, you may not have the time to go around and do all of these things.
Renting a property involves risk and liability
When you rent a property to a tenant, you may be exposed to certain risks and liabilities, such as lawsuits from injured tenants or non-compliance with your state’s tenant-landlord laws. Alternatively, you could end up having to pursue damages from a tenant who trashed your property after you had to evict them.
It is still a risk, even if there are ways to mitigate it, such as having adequate liability insurance and owning each property through its own company. Get adequate coverage to better protect yourself by staying up-to-date on federal, state, and local rental laws.
The pros and cons listed above can help you make the right decision if you’re first time become a landlord.