Joe Homs, a broker with over 40 years of experience, covers the basics for first-time landlords: treating rentals as a business, collecting rent reliably, handling maintenance, securing deposits, and protecting yourself with proper insurance and lease agreements.
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In today's video, I'm going to show you what all new landlords should know. Coming up next. Becoming a landlord for the first time can be a daunting experience. It could be that you're an accidental landlord and want to be successful with your first house to rent by owner, or you may have purchased your first investment property to earn passive income. Whatever the case, being a landlord is an excellent way to build wealth if you are willing to do the hard work. Before we get started, make sure that you subscribe so we never miss a video. I have over 40 years experience as a broker, investor, and mentor. I made this channel for the new and experienced investor, those who want to create the life they've always wanted through real estate. First one, treat your landlord role as a rental business. And for this, I always like to use kind of the golden rule. I like to treat people The way I like to be treated. So run your business as a business, but treat everybody fairly and honestly, and you'll go a long way in this business. Number 2, manage the rental property properly. And by this I mean, again, this is a business. So should you raise the rents every year? That's really up to you. I do it every couple of years. But don't be like the first-time landlord out there. And I get calls all the time, hey Joe, I'm thinking about selling this place and my tenant's been in there for 15 years and I've never raised the rent. And it's like, okay. So don't be like that. Renters expect, expect that the rents are going to be going up either each year Or every other year. You have expenses that go up every year. So again, treat it like a business. Number 3, decide on a method to collect rent. And there are various methods out there. You can literally knock on the door every month and say, hey, here I am. Do you have my money for me? Cash is given, a check is given. If you don't want to go through that trouble, then make arrangements for your tenant to drop the money off at your bank. Provide them with your bank account number and they can drop the money off there. As long as it's a check, I don't believe that many banks accept cash anymore. So you can do Venmo, you can do Zelle. There's services out there, companies that you can hire that they can directly send it to them. I would, would never give my home information out to a tenant. That's why I have a PO box or an office, and I have my tenants either drop it off at my office or send it to my PO box. Any of those would work fine. You need to decide what works for you. Number 4, keep the rental property well maintained. And if the tenant calls with any issues, try to be on it as quick as you can. You know, whatever it is, if it's an electrical plug that's not working or whatever, just, you know, take a little time. If you're handy, go over there and change the electrical plug. If it's something more sophisticated, then you're going to have to get a professional over there. I also do property management, and what I tell my clients is have a home warranty policy. And then this way, when I manage their property, if anything major comes up, I can literally just call the home warranty company. They will send a professional out there to take care of whatever it is. There is a service fee for that, but it's way less expensive in the long run than hiring a contractor, handyman, plumber, electrician for anything that comes up, you know, during that rental period. So try to keep the the place, the rental place, in as good condition as possible. Number 5, really important, you need to get landlord insurance and require your tenants to get renter's insurance as well. Your landlord policy will cover you, okay, so we're talking a single family, they will cover you for any fire damage. You want to get as much liability As you can. I believe the limit around in California is about half a million. You can also get an umbrella policy of another million dollars to cover you liability-wise if something happens on a property, slip and fall or whatever. The landlord— I'm sorry, the tenant insurance is just a conversation that you have with the tenant and you tell them, I've got insurance to take care of my stuff. The structure, everything inside. But my insurance doesn't cover your personal property. So if something happens in here, whether it's, you know, a fault that is mine or yours, you need to get insurance if you want your contents covered. So that's just really the conversation that I have. And I leave it up to them whether they want to get insurance for their personal stuff or not. I I've, at least I've given them that information. Regardless of whether your rental property is being used for extra income or as your only source of income, it's vital to manage your rental business correctly. Before your first tenant moves in, it's necessary to sign the lease agreement, collect the first month's rent and security deposit, and conduct a rental inspection with the new tenant. This way you can run a successful rental property business, even if you only have one unit. If you want to see me get rental property ready to lease, click on this video right here. I do a full walkthrough and show exactly what to look for. If you need help, don't hesitate to reach out. I'll see you on the next one.
