Three Most Common Landlord Mistakes
As a Canadian real estate investor and landlord, one must pay attention to the amount of time that you spend managing your properties. You have to be cognizant of the fact that you want to be spending your time creating more deals, rather than spending your time dealing with tenants. You need to spend time on your business not in your business.
That said, we must do our best to create an excellent business relationship with your tenants.
The first mistake is becoming too friendly with your tenants. When you are too friendly with your tenants, they tend to take advantage. They will expect certain things of you like rent reductions or breaks on the time when they pay rent.
The reason why landlords want to be friendly with their tenants is because they don’t have the confidence in their business, themselves or their properties to be able to keep tenants in their properties. They all too often bend over backwards to make everybody happy and consequently they get ruledby the tenants.
An example that may hit home
I knew somebody who had a particular situation whereby they needed to raise the rent. It was perfectly in keeping with all the rules and guidelines. They said to the tenant, “just so you know Mr. Tenant, I’m going to be raising the rent in 60 days and I have your notice here.” Mr. Tenant said “oh no, you shouldn’t do that…I really suggest you wait until next year and maybe you can raise it then.” Unfortunately, that landlord was too scared to lose the tenants, so didn’t end up raising the rent. This was just another step to the tenants winning a small battle (of which there were many), and therefore took control the relationship.
The second mistake
The second mistake that landlords commonly make is in keeping with the first mistake. On the day the rent is due at , they run all over town to each and every unit collecting rent. Sometimes tenants promise that they will be there at a particular time with the rent and they are not there when the landlord shows up. You have wasted time and your gasin driving across town for no reason.
The third mistake is getting post-dated cheques from your tenants. The problem with a post-dated cheque is that if it bounces, you don’t find out about it until 14 or 15 days later.
By the time the tenant writes another cheque, it is probably the 16th or 17th of the month. Then, if that cheque bounces, you won't find out until the end of the month. By that time the tenant has been staying in your place a month for free.
At this point, any way you cut it, you lose. My suggestion is to get people to place money into your account on the first of the month. Open up accounts in whatever bank is closest to your unit, and have them deposit money.
On the second of the month, you can go online to be able to see who has paid and who has not paid. And at that point, you can take care of it right away.
Change the way you do business and change the type of relationship you have with your tenants. You will find that you have more responsible tenants and you will spend less time dealing with unnecessary problems.
World Wealth Builders offers many unique, practical, out of the box real estate investor trainings which offer the student hands on, in the trenches style instruction. To find out more, please go to www.worldwealthbuilders.com.
P.S. Take Action now to attend the eye-opening seminar and walk away with confidence, knowledge, and specific "action ideas" that can help you achieve your dreams and leave the rat race behind.
We have been training Canadian Real Estate Investors since 1993