Since 2020, rent prices in Riverside, California, have shot up by 40%. If you can afford to buy a rental property there, your bottom line will look good by default.
There's only one exception to this rule: being a first-time landlord. Managing a property is as much about experience as it is about knowledge. Knowing why, say, rental analysis is important doesn't mean you know how to do it.
Want to ensure your new investment remains profitable? Here are some tips that will help you stay ahead of the competition!
Have a Written Rental Agreement
Rental agreements are essential for communicating your expectations and protecting your rights. If you don't put this information on paper, it can be difficult to prove what you and your tenant agreed on.
A good rental agreement should also be specific. The less you leave open to interpretation, the easier it will be to communicate with the tenant. Keep in mind that your rules should also adhere to California rental laws.
Take Advantage of Rental Analysis
Setting the right rental price can be a science unto itself. To do it right, your first step should be to do a rental market analysis. This involves determining a fair rental price based on comparable rentals in your area.
A simple way to get rental comps is to go to a site like Zillow. You can also befriend local landlords and obtain this information from them. Make sure to get at least three comps before settling down on your rental price.
Collect Rent Payments Online
Even if your rent is fair, you should make it as easy to collect as possible. These days, this means allowing online rent payments. Doing so allows you to set up scheduled payments that automate the whole process.
Online rent collection also provides transparency. You'll know when a tenant makes a payment and when it will reach your account. There's no danger of the check "getting lost in the mail."
Use a Thorough Screening Process
Tenant screening is a huge part of avoiding tenant trouble down the road. When sifting through rental applications, focus on the details. Look at things like income, landlord references, reasons for moving, and so on.
Another way to confirm if an applicant can afford your place is to run a credit check. Credit reports can include all sorts of red flags, from notable debt to prior eviction history.
Keep Records of Everything
As a landlord, you should keep all documentation related to your business. This includes rent receipts, deposit receipts, and maintenance records. If you face legal issues, you'll have evidence to support your claims.
For best results, keep these records in a digital form. On top of minimizing paper clutter, digital records are far easier to look up. They also tend to be safer and easier to access.
Becoming a Landlord in Riverside, CA
The bottom line: being a first-time landlord is tough, even in California. From rental analysis to tenant screening, every step along the way matters. These tips will help you know what to expect from this process!
Want to outsource some of the above tasks to professionals? At PMI Riverside, we've been helping first-time landlords for over 20 years. Contact us here to learn more about our property management services!
