The Top 7 Mistakes New Landlords Make

So, you’ve recently become a landlord or are thinking about purchasing a property with the intent of
earning rental income. Congratulations! The learning curve is steep and not without challenges but
with discipline and consistent effort you will find the road ahead is worth it.
Renting out your property can be a lucrative business venture, but you may find it’s not as easy as
expected. Here’s a quick list of some of the more common pitfalls many landlords discover and a few
things you can do to avoid them.

Lease Issues
A good lease may be most tool in your kit. Before allowing someone to move into your
property, ensure your lease meets your needs and will protect your assets.
Common clauses include the lease term, pet policy, security deposits, utility costs, smoking
policy and yard care. There are many lease templates available on-line, but before using one
ensure it meets your needs and is legal in Alberta.

Inadequate Tenant Screening
I know you want to place a new tenant quickly but choosing the wrong tenant is often an
expensive learning experience. Do your research before you rent to anyone; obtain a credit
check, obtain references and be sure to check them.

Performing your due diligence as part of your tenant screening process will significantly lower
your likelihood of conflict, non-payment of rent or expensive damages later.

Emergency Funds
Ensure you have funds available to cover your basic expenses for at least two months in the event of a vacancy.
Remember that your mortgage provider, will require payment even when the place is vacant.

It’s also essential that you have money available for emergency repairs that may come up and
to handle routine maintenance whether or not the place is occupied.

This is not a Hobby
This is not a hobby! Treat your investment as a business. Treating your rental as a business is
the only way to turn a profit, understanding the responsibility you take on with this venture is
essential to success. Treating it as a hobby, will eventually lead to trouble.

Create and use separate bank accounts, with one for your rental business and another for your
personal needs. Maintain contact with your tenants, and don’t neglect them—remember they
are your valued customer! Failing to do so, means you will not hear about their concerns which
often higher maintenance and repair costs and even higher tenant turnover.

Shirking the Research
Landlords who don’t do their homework will face the consequences. Renting out a property
comes with its fair share of legal issues and liabilities, and it’s essential that you become well-
versed on local, and provincial regulations before even considering renting out your space.

Being Lax On Rules
If you don’t strictly abide by your lease, your tenants won’t either. If you have a rule, stick to it!
If your lease has a no-pet policy, and you find a cat in the apartment enforce your policy! If you
have a penalty for late rent, apply the penalty!

Letting things go once means letting them go every time, so nip any bad tenant behavior in the
bud the moment it occurs.

Not Hiring A Property Manager
If the points listed above seem overwhelming, you might want to consider hiring a property
manager. Admittedly, I am biased, but as a Property Manager, we handle a host of duties: face
to face interactions with tenants, advertising, property maintenance, and even evictions.

Give us a call, we can help!