In the Pasadena, Glendale and Burbank areas where I manage property I recently talked to two property owners who were thinking about putting their homes on the rental market.
Both owners were new to landlording and both wanted to talk about worst case scenarios. I get it. If you google landlords, tenants, property management, etc. you will find endless horror stories and these owners wanted reassurance.
Leasing out your property is a risk. So is getting out of bed in the morning. You might fall, you might hit your head on the bedpost, you might trip over the cat. You wisely mitigate your risks by not arising until both feet are firmly placed on the ground, removing slippery throw rugs and shooing the cat or banning him from the bedroom. You mitigate your risks and don’t stay in bed, fearful of possible catastrophes.
Although leasing out your property is a risk so is not leasing out your property. Your bottom line is at risk when you have a vacancy and no rental income coming in. A vacant property is at more risk from vandalism than an occupied property.
The first thing these owners asked me about was eviction. I went over my screening process with them and told them the best prevention against an eviction is thorough screening. However, I can’t guarantee 100% a tenant I place will never end up in eviction because we all know life happens no matter how well we plan. A tenant may contract a serious illness, not be able to work and not have the income to support the rent. Or a happily married couple may eventually divorce, and the remaining spouse not be able to afford the rent. Thorough screening makes the percentage of tenants who are evicted very small, but I can’t promise it will never happen.
Two other expensive problems that might occur are bedbugs and mold. In a single family home you can have a pest control company certify the property as bedbug free before tenants move in.Then, If bedbugs occur after move in it’s the tenants’ obligation to remediate.
Best way to avoid mold is to be proactive about water intrusion. Make sure your roof is watertight and handle any plumbing leaks quickly. I also cover mold prevention when going over a lease with tenants.
Yes, renting your property has risks but an experienced knowledgeable property manager can help mitigate your risks and provide peace of mind.