Hot Property: Three Things Every Potential Landlord Should Think About
Property is consistently one of the best investments that you can make. Especially if you decide to rent that property out. Being able to make a passive living from being a landlord is a dream that a lot of people have. Of course, it’s not quite as simple as buying a property, getting a tenant and watching the money roll in. Being a landlord is a lot of work and requires more than a little knowledge and know-how. Some things are more important than others and here are just a few things that every potential landlord should consider.
The type of lease
This gets especially complicated if you’re looking at commercial renting. Where you’re renting out a property as a retail space. You need to make sure you’re carefully considering exactly what type of lease you’re using. Decide whether you want to use something like a gross lease or net lease. In a gross lease, you would charge a higher base rent, but the financial responsibility of tax and other expenses would fall on you. Having a net-leased property would mean that the tenant would be responsible for those charges, but you pay a lower base rent. Make sure that you think carefully about what type of lease would work best for you as a landlord.
The type of tenants
Just like before, you’ll need to consider what kind of tenants are going to be renting your property. If it’s a private domestic property, then you might want to consider the sorts of tenants you’d want to live there. For example, students can be relied on to come and go pretty regularly, with new students coming up every year. But the downside of that is that they tend to take less care of the property. A family, on the other hand, might be a little harder to find. But they will generally make much longer lasting tenants who are far more likely to care for the property. If you’re renting out a commercial property, then make sure that you’re thinking about what sort of business will be run there. You don’t want to find your reputation as a landlord tarnished by renting to a less than reputable business.
The level of maintenance
Think carefully about how much upkeep you will be willing and able to manage. You might find a property that seems like a total bargain but turns out to have a lot of problems that require great deals of maintenance for example if you have plumbing issues you may need to contact a local plumber to have a check. This could turn out costing you far more in the long run than you were expecting. On the other hand, if you spend a little more on a newer and more well-maintained property, you could end up saving a lot of time, money and effort over its lifespan. You should also make sure that you’re aware of the kinds of maintenance they will need and how it will be done. Can you do any of the maintenance yourself or will you need to pay for a professional to come in and do it?