Has the luster of being a landlord worn thin? Are you struggling to find time to fix all the little things your tenant complains about? Are the hassles of being your own property manager intruding on your day job?
Being a hands-on, DIY landlord is a lot of hard work. Even if you’re a talented handyman with more tools than shirts, being your own property manager takes time. A successful landlord wears many hats from blue-collar worker to political negotiator and everything in between. But unless you’re financially independent, the one (or two) property landlord is usually stuck in that no-man’s land between managing the rental units and keeping the boss happy.
Are You Tired of Being a Landlord?
Maybe you’re not cut out to be a landlord or your circumstances have changed. The cash flow may not go as far as expected. The liability insurance may be too much. A major promotion could mean you have even less time… Whatever the reasons, you don’t want to be a landlord anymore so what are you going to do with that extra piece of real estate?
Not Landlord Material
Even with ok long term tenants, the property just keeps on depreciating. They don’t mess things up, they’re quiet but the wear and tear just makes the property look shabby and tired. And when they leave, there’s always the repainting and sprucing up to do…again, before quality new tenants will even consider the property.
Then there’s always a time crunch. Fixing things has to happen after work or on weekends and some major problems need more expertise than you’ve got. Limited DIY skills mean that while you can repair the little things, you’ll probably have to call out the experts for wiring and plumbing and they can be expensive
Landlords and Stress
Even good tenants can cause you stress and make you tired of being a landlord. Tenants move and don’t always clean up so well; water stained toilets, showers and sinks, half dirty appliances and a host of other small annoyances. These little things cost money to hire someone to clean. So you don’t return the deposit, they argue, you argue back, they clean up some more but this time you have to be at the property to let them in and because it’s a long drive, you have to wait while they finish. Then you refund the full security deposit – they’re happy – you just lost your whole Saturday. Stress!
Liability and Other Legal Issues
No matter how safe and secure your rental is, you still must have sufficient general liability insurance coverage on your rental property. This helps reduce risk and limit personal liability as a landlord. Responsible landlords do their best to make sure their rental units are safe. But the bottom line here is you can never predict what your tenants are going to do to undo your diligence. Which brings us to the next point…
No More Mr Nice Guy…
You’ve got some really nice long-term folks in your property and you’d like them to stay. Figuring you’ll catch more flies with honey than with vinegar, you give them some leeway when the check is occasionally late. Here’s where not-so-nice landlord clashes with mostly good-guy-syndrome. It’s probably better in the long run to do things by the book and be all-business.
Of course, there’s many reasons to sell but if you’re not cut out to be a landlord, other forms of investing could be a better fit and yield a comparable cash flow. With current market conditions, selling that underperforming rental now means better liquidity.