Not understanding the local market.
Some investors do not understand the local market. They do not understand what rents go for, or what properties sell for. Sometimes, they take what property sellers say as gospel without doing test and measure. They do not do their due diligence and homework. They buy properties because they get emotionally involved in the deal, and they do not run their numbers.
Not understanding Fair Housing Laws.
There are laws and regulations that protect the tenants and these laws must be respected by the landlords. There are the protected classes, 7 Discrimination Laws, Texas Property Code, and a lot more things that you need to know. Fair Housing Laws make us understand the rights of the tenants.
Not understanding how to best market the property.
Make sure to market your property correctly by putting it at the right price point for the area, and not on what your mortgage is to make money. The market will dictate on what the property will rent for.
Not screening the tenants properly.
This is a huge problem to a lot of landlords. They usually go off with their gut feeling, and that is the worst thing that you could do. Put the right person and make sure they are doing what is needed. Also, make sure the tenants are properly screened.
Incorrect leasing information.
When filling up leasing paperwork, make sure the lease is current and enforceable by law. Do not put anything in the contract that you cannot enforce. Also, make sure to understand what your responsibilities are as a landlord. A lot of landlords put scary things in the lease agreement without knowing if they can or will enforce them.
Not knowing what maintenance costs will be.
If you are buying an older home, realize that you may not only be getting a deal but also higher maintenance costs associated with that.
Not understanding that property management is a business.
Business has policies, procedures, and structures. Realize that when you are in property management, you own a business and you have to treat it that way.
If you want to talk to us about buying a property, strategizing, or if you just want us to help you find a property to buy or lease, do not hesitate to call Empire Industries. We would be happy to help with any Houston property management concerns.