Becoming a property ‘mogul’ is among one of the many aspirations that many people have. The idea of having a somewhat passive source of income in the form of rent is very appealing. For this reason, more and more people are gravitating towards owning rental property as a way of supplementing their monthly income.
Before you can fully immerse yourself in buying houses in South Florida and converting them into rentals, you must be cognizant of a few things. Below are some examples of what you need to in order to ensure that you can be successful at it.
a) Formulate realistic goals about owning rentals
As much as owning property and getting consistent rental income is a splendid idea, you cannot become rich overnight. Rentals are a good moneymaker but they come with a lot of responsibilities.
For starters, you must get liability insurance for your property just in case. There are other additional expenses you must factor in before you can fully get to a sustainable income.
Therefore, you must formulate realistic financial goals that are within reason in regards to your rental property. This way you can sustain the resources needed in keeping up with the properties.
b) Educate yourself about the laws and regulations governing rental ownership
If you get into a legal battle with a tenant because of an alleged violation, you cannot simply claim ignorance of the law. As a new property owner, you must ensure you learn every law and regulation applicable in regards to rental properties in your market.
You must undertake all research that is there about those laws. This way you can protect yourself against lawsuits and problems with tenants or other people.
c) Join a Landlord’s organization in your area
If you are new in the rental property arena, you should consider joining a landlord’s organization in your area. The benefits that come with this are immense.
One of them is that you get to network with professionals. They will show you the ropes and connect you to the right people. Most organizations put together regular events that promote the exchange of ideas and transfer of knowledge.
d) Insurance is a non-negotiable
As a new property owner, you are liable for the safety of the tenants in your property. Should anything go wrong while they reside in your property, insurance should cover any losses that might occur. Insurance will also cover a lot of damages to the property that could occur. This is an expense that cannot be ignored under any circumstances whatsoever.
e) Create an emergency fund just in case
Insurance is a good measure for protection but sometimes it is not enough. As a future property owner, you must be proactive and set up an emergency fund for rainy days.
The fund must be equivalent to 10-20 percent of the overall property value. Also, you should contribute to the fund regularly don’t just stop when you reach 20 percent of the value.
These are some key steps that will ensure that you will be on the right track to becoming a successful landlord.
Useful Reference Links
Thinking About Becoming a Landlord? Avoid These 6 Rookie Mistakes
Top 10 Landlord Legal Responsibilities in Florida | Nolo.com
A guide for investing in rental property – CNBC.com
Being a Landlord Is Most Profitable in These 10 Areas – Zillow
5 Steps to Become a Landlord in Tampa, Florida