Real Estate can make you rich, or it can make you a pauper. It is a great way to quickly transform millions into thousands. Going in with too much confidence and not enough education will poison your investment and leave you holding an empty bag.
We all enjoy watching shows like Property Brothers. But the danger with such shows is that they make house flipping look too easy. They have a few adventures and hijinks. But after almost every show, they have made $30,000 to $70,000 of profit in a few weeks. That is a year’s salary for a lot of people. Who wouldn’t want to go into that business?
What they don’t often show you are the times where they have lost money. They also only focus on one of the ways you can make money in real estate. Another way is to buy rentals and become a landlord. It can be a very lucrative option. But when becoming a landlord, there is a lot more to consider than profits. There is also an ethical component. The human cost of being a bad landlord is high. You need to care deeply about the people who rent your properties. Take the following concerns to heart if you want to be both profitable and ethical as a landlord:
San Diego has been in a fight for clean water for some time. They have recently announced a major victory insofar as the water authority claims to be safe from drought-related water shortages through 2045. That is a major victory. But that does not mean the fight is over. It still has to be fought and won at the individual level. As a landlord, you can be sure your rentals have a reverse osmosis system to ensure the purest water possible. Having water running through the pipes is meaningless if it is not fit to drink.
When you live by the sea, you might not consider water a major concern. After all, salt water has many benefits. But the challenge of clean water is a major concern for many families. It cannot be resolved by simply putting a filter on the kitchen faucet. Because the problem runs deeper, so too must the solution. As a landlord, you have the opportunity to offer a better solution.
Use Better Tools
To be a better landlord, you have to use better tools. You cannot create a stress-free rental portfolio if you are not using the right set of tools for the job. Consider your communication tools. Do all of your tenants have your mobile number? Is that even a good idea? How many issues go unaddressed because you missed a call or text? Whose responsibility is it to monitor tenant complaints and get back to them in a timely manner? If it is a hit or miss situation, your renters will only notice the misses.
Do you have a rapid response plan for if something catastrophic happens to one of your rentals? A displaced tenant whose belongings are destroyed by flood will be looking for guidance. Your rental portfolio will never be stress-free for you until it is stress-free for your renters.
Your Own Family
If you want to be the best possible landlord, you have to treat your rental properties as if they were being occupied by your own family. What might you do differently for the property if your mother was one of the renters. Now, imagine that you don’t know which of your properties she is renting. You just know that she is in one of them. How would that change how you handled your properties? This is a variation on the moral philosophy called the veil of ignorance. When any one of the spaces you rent could be housing your own mother or your own child, you will not need to be told how to treat that property. You will still make a prophet. But you will understand that there are some things even more important.
Renting out a property is not just a way to make a relatively quick and easy buck. It is a major responsibility for which not everyone is suited. You are perfectly suited if you can prioritize clean water, the right tools, and the ability to treat your tenants like family.