Secrets of the Stress-Free Landlord

Right now money is cheap, the real estate market is white-hot, and the latest research suggests Americans have a collective $2 trillion more in checking accounts today than they had before the onset of the COVID pandemic.

So if there were ever a time for average Americans to dip their feet into the pool of real estate investing, it would have to be now. What’s holding them back?

In reality, the number-one obstacle that keeps people from investing in real estate has little to do with their finances or the state of the market. It’s a much more personal factor … and unless people confront it proactively, owning a rental property will never be in the cards for them.

Six Tips for Stress-Free Rentals

The truth is that most people – perhaps including you – stay out of real estate investing because they don’t want to face the hassles. They’ve heard horror stories of late rent, midnight phone calls from angry tenants, and properties that sit vacant for months… slowly siphoning money out of the landlord’s bank account week after week.

So they stay away. Though there are plenty of situations where rental properties are nothing but a burden to the investor, it doesn’t have to be like that. Most landlords – the successful ones at least – have developed systems and processes that make their lives largely stress-free.

They simply log into their bank account on the first of each month and see their rent payments waiting for them. The question is, how do you get to that point? How can you invest in real estate and become a stress-free landlord who simply cashes checks on a predictable schedule?

Here are a six of the winners’ best-kept secrets.

1. Have a Team on Speed Dial

Stress-free landlords don’t try to do everything themselves. They understand their limitations and know that it’s usually wisest to pay professionals to handle the duties that are outside of their realm of expertise and/or not worth their valuable time.

It’s a good idea to have the following on speed dial: a real estate attorney, an insurance professional, a mortgage broker, a licensed contractor, and a real estate agent. But you can simplify matters even further by just hiring a professional property management team.

Take Katy, Texas-based Green Residential as an example. They offer a comprehensive property management package that includes everything from tenant screening and property marketing to rent collection, repairs, and eviction services. This all-in-one solution makes a landlord’s life so much easier!

2. Write Descriptive Listings

Most landlords make the mistake of assuming rental property listings are designed to generate lots of leads in order to land a tenant. But the best landlords are actually not focused on that at all.

They hate the idea of fielding a series of phone calls from tire-kickers. Instead, they write listings that pre-qualify applicants so the phone calls they do receive are much more likely to turn up nothing but suitable tenants.

The key to a good rental property listing is to make it as descriptive as you possibly can. You want to make it quite clear what you’re offering (and what you’re not) so the only people who contact you are the ones with legitimate interest.

As you write descriptions for your listings, include all the essential information (such as price, location, number of bedrooms, etc.). But you should also include key details like whether pets are allowed, whether you’ll be running background checks, how much the security deposit is, and so on.

These details help to weed out most of the unqualified people who would otherwise waste your time with phone calls, showings, and screening.

3. Develop Templates and SOPs for Everything

Stress-free landlords are really good about making systems for everything. Any time there’s a repeatable process, they document it in the form of a standard operating procedure (SOP). This enables them eventually to hand off the task to an assistant.

Templates are something else stress-free landlords rely on. Email templates for common requests, fill-in-the-blank legal documents, and copy-and-paste notices allow a landlord to streamline communication in most scenarios.

4. Draft a Meticulous Lease Agreement

It takes a lot of time to develop an appropriately detailed lease agreement, but that’s something stress-free landlords take very seriously. They also walk every new tenant carefully through each section of the lease prior to the signing. This ensures both parties are on the same page.

5. Automate Rent Collection

Rent collection is one of those tasks that most landlords find a struggle. But the reason it’s such a pain is that many of them have no system.

This leaves them chasing down rent checks, playing telephone tag with tenants, and filtering an endless stream of excuses until they finally get the money. Stress-free landlords, on the other hand, automate rent collection using online payment portals and/or direct deposit.

This allows them to collect rent on a predictable date each month and avoid any back-and-forth with tenants.

6. Keep a Healthy Emergency Fund

Stuff happens. Pipes burst, appliances break, windows need replacing, etc. Savvy landlords know this, so they prepare ahead of time by keeping a healthy emergency fund for each property they own.

This usually amounts to three to six months’ worth of expenses. When a repair or maintenance arises, they have the ready cash to address it.

Follow the Leader

You don’t have to reinvent an entire framework or process. (In fact, you probably shouldn’t.) The smarter strategy is to swipe the playbook of successful landlords who are already where you want to be.

We hope this article gives you a solid foundation to build on.

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