TIP NO. 1: Be Well-Insured
There are a variety of insurance packages available for landlords and some are more comprehensive than others. Oftentimes, the purchase of insurance coverage is a hasty decision we make just before settlement on a property. Do your research and find out what kind of insurance products are available specifically for landlords. For example, you can visit AAOA’s insurance page to get quotes from multiple carriers at once at no cost to you. If there is an optional tenant rider or endorsements for additional coverage, I pay for it. If you only accept the products that your neighbor’s best friend “the insurance agent” has available to them, then you may be doing yourself a great disservice. Being well insured is the number one rule of asset protection. Also, when purchasing appliances for your properties, consider purchasing the extended warranties if the cost is reasonable. And be sure to add a clause to your lease agreement requiring the tenant to name you as an “additional insured” on their renter’s policy.
If your lease agreement only “recommends” that the tenant obtain renter’s insurance, consider making it mandatory. Add a clause which allows you to demand proof of continued coverage at any time
TIP NO. 2: Inspect More Often
If we only inspect the property after the tenant vacates, we are bound to find a lot of damages, particularly if the tenant resided in our property for a long period of time. I recommend quarterly inspections. My tenants know from the beginning to expect this and it changes the way they think and live. I am certainly not going to wait for an entire year to find out how the tenant is treating my property. Excessive damages and even excessive wear and tear are a breach of my lease agreement. If you have a building with multiple units, consider some nominal award (such as a gift card) for those tenants who get a 5-star quarterly inspection. Like I said, think outside the box!
I AM CERTAINLY NOT GOING TO WAIT FOR AN ENTIRE YEAR TO FIND OUT HOW THE TENANT IS TREATING MY PROPERTY.
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