With over 35% of households in the US renting their homes and approximately 296,000 property management companies managing these properties, there are a lot of people who may be out there deeming themselves rental experts. And in the process, spreading misinformation with outright confidence (*side eye*). But don’t fret! With over a decade of experience in the property management industry, we’re here to bust 5 of the most common myths about rentals.
Myth #1: Owning rental property is passive income.
The Truth:
No, we don’t care what you heard from the TikTok real estate expert. We won’t argue that a multifamily rental property isn’t a great investment…it is! But if you think it’s as simple as collecting your monthly rent checks, think again. Consider all of the maintenance and repairs you’ll be responsible for, the time and energy required in the leasing process, and the management of concierge services like guest access, deliveries, or even amenities. Property management is a lot of work, which is why a lot of owners invest in software to streamline their operations. And yet, it still won’t be as passive as many internet gurus will have you believe.
Myth #2: Having good credit means they’ll be a good resident.
The Truth:
Having good credit is only a small piece of the entire pie that makes someone a great resident. Of course, being able to pay their rent on time is a huge consideration, but don’t stop there. Finding out information on their previous rental history (have they ever been evicted?), doing a proper background check (do they have a criminal record?), and even interviewing them about their lifestyle is key to picking the best applicant for your vacant unit. While they may be able to pay rent, they could end up being a resident that causes havoc at your property if you’re not thorough during the screening process.
Myth #3: Rental prices are firm.
The Truth:
If you’re new to property management or renting in general, you may be surprised to hear that rental prices can be negotiated. A renter’s bargaining power will vary greatly depending on external factors such as the location and time of year, but it’s good to be prepared for the possibility of a negotiation. At the end of the day, you as the property manager will have the final say, but it could be in your best interest to take up a fair offer.
Myth #4: Maintenance is always the responsibility of the property manager.
The Truth:
The truth here will come down to the lease terms you’ve set. Most property managers will take on general maintenance tasks like a broken a/c or lack of hot water, but draw the line at issues caused directly by the resident. Whatever you decide, make sure your residents are well aware of their responsibilities to avoid an uncomfortable situation down the line caused by miscommunication.
Myth #5: Residents can be evicted for any reason.
The Truth:
Of course, you don’t want to have to evict anyone, but if that time comes, it’s best you know your rights. Generally, property managers need a warranted reason, most often proof of a broken lease, to legally evict a resident. Eviction laws vary by jurisdiction, so be sure to do your due diligence before throwing a resident’s belongings on the curb.
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