If you’ve followed this blog the past couple years you know that my wife and I became a landlord two years ago when we bought our first home.
We have a studio apartment built into the house and rent it for side income to help pay the mortgage.
Throughout the past couple years we’ve learned a lot about being a landlord in your 20s – or any age for that matter.
Being a landlord isn’t easy, but it can be rewarding. Everyone needs a place to live, so owning a rental property is reliable income. You build equity over time as well, which means if you ever divest yourself from the property you will most likely leave the deal with more money than you came with.
Here are a few tips on how to become a landlord in your 20s.
Decide What Type of Property is Right for You
There are many things to consider before becoming a landlord. One of these things is the “type” of property to be a landlord of.
When my wife and I decided to pursue rental income we knew that we wanted to start small. We bought a house that had a studio apartment setup. In fact, the last tenant at the property had stayed for a total of seven years; clearly this property was a good one for new landlords.
Another option for landlords in their 20s is a condo. Condos are generally smaller and easier to maintain than larger stand-alone properties. If a condo isn’t what you’re looking for, a duplex could be another good option. As a landlord you can either live in one of the units or live elsewhere and have two rental units.
Location is another variable to consider. If you plan on managing and maintaining a rental property yourself (the most profitable approach), it’s definitely easier to live close to your rental unit. With that being said, it’s also possible to manage a property from afar. If you have a good rental management company and are willing to sacrifice some of your margin there is no reason you can’t have a property hundreds – even thousands – of miles from where you live.
Be Mindful of Potential Emergencies & Maintenance
One of the biggest things to be mindful of when you you have a rental property is the potential for emergencies and maintenance. Issues with a property can range from minor – such as the need to re-caulk a shower, to major – such as a backed up sewer drain-out.
As a landlord you need to be prepared to either be “on-call” 24/7, or to have a property management company contracted out. You also need to have a designated emergency fund to put towards repairs and maintenance of the rental property.
Always Keep Learning
The most important thing about being a landlord in your 20s is to use the situation as a learning experience. Did the rental property you choose to go with not work out as planned? Use that information to find a better property in the future. Did you overpay for that plumbing repair? Find a better contractor next time (Angie’s List is a great resource – it saved us thousands of dollars).
Taking advantage of information on websites like the No Nonsense Landlord can be extremely beneficial to landlords in their 20s. Learning skills such as plumbing, electrical, and other construction skills can save you a lot of money over time, especially if you keep buying up rental property.
Do you desire to own or already own rental property? What interests you about rental property? What is the worst part about being a landlord?
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We don’t own a rental property, but would really like to in the near future. We’ve thought a lot about buying a duplex and living in one unit. Rental properties are a great investment if you pick the right one in the right place and are ready to be a landlord.
StudentDebtSurvivor I agree! I don’t think there is any “perfect” rental properties, but some are better than others.
This is the first time I read this post DC. Great way to make extra income. Just be sure to get good tenants, and that is not too difficult.
No Nonsense Landlord Glad you enjoyed it! It’s definitely a great way to diversify your income streams.
DC, I really enjoyed reading through the section where you talk about how you should always be prepared for potential emergencies and maintenance issues. This seems like it would be a great tip for new landlords to keep in mind. It seems like always being prepared for these types of issues can make it easier to handle them when they happen. My uncle manages a couple of properties and I think this might make some good advice for him. http://www.resteasyproperty.com/
I think that it is very important to be mindful of potential emergencies and things like that. I’m happy that you touched on that a little bit. Your tenants will rely on you a lot when it comes to potential living area emergencies. After all, you are basically in charge of the well being of the home. http://www.resteasyproperty.com/
You don’t even have to start at getting a new place. You could easily start by renting out your extra room as well. Me and my wife did that it was the best because it was like getting an extra paycheck every month. http://newbernforrent.com
I definitely think that it would be a really cool experience to be a landlord. It would definitely be nice to be able to get some extra money every month. However, dealing with property management seems like a really hard and complicated job. There are so many different details that go into play when it comes to things like this. I really respect people that are able and willing to go into this career.
http://www.tjpropertymanagement.com
This is some really good things for young people to think about. I always thought about having an income property, but I didn’t ever think about doing it in my twenties. It would be more beneficial to do it sooner and It would make sense to look for a house that has a rental suite. It would be a great way to make some extra money although I would want someone else to manage my property for me. http://www.tjpropertymanagement.com
The part that stuck out to me was when it said to “keep learning” from your experiences at managing a property. It would seem like an important thing because with different situations, different lessons are bound to be learned. I suppose it would come down to personal situation and responsibilities with different properties. http://www.sjcmanagement.com
DC, this is just the information my husband and I are looking for about property management. We have been thinking of getting into the business for a while now. We could use all the tips we can find! The tip about deciding what type of property would be work for us seems like a good idea. A condo might be a good place to start.
Emily Smith | http://www.tjpropertymanagement.com
This could be something I’d really be interested in when it comes to being a landlord. It would really be fun to be over a house and it could drive in some income as well. Perhaps I’ll look into buildings to buy and rent out, definitely something I’m interested in! http://www.spectrumpropertymanagement.com/provo-utah/
I like how you said to always keep learning at the end of this. A lot of times people think that once they’ve done something, they’ve mastered it, especially with something like this. But just because you bought a house and are able to rent it out doesn’t mean you’re done. There’s so much more to learn to improve the way you do things, and that’s what people really need to focus on. Hopefully they can do that and have everything work out for them.
http://www.reedyandcompany.net/property-management
Deciding what type of property is right for you is very important when trying to get into real estate rental. I remember back when my wife and I were landlords for some student housing at one of the nearby colleges; we chose to do so because we wanted to make cheap affordable living for the students. It really worked out for us because of how many students passed through the apartments before we sold them. http://www.completeresidential.com/residential_management.html