Owning rental property has become a modern day vehicle for the average person to try and obtain wealth. Land or property ownership was originally the domain of the wealthy. The commoner rose up and said we want to own land as well, which became a normal part of society. Modern day society in most countries has a system that allows all people to own land and or property. The ownership of property now has emerged into a form for the average person to obtain wealth through the acquisition of property. 

What many average people don’t understand about being a landlord is that, when you are a landlord you become a business owner. Managing a business is different than working as an employee. The biggest difference for a business owner is the emotional aspect of making decisions that affect other people. Often as an employee you are taking direction from someone and not making the decision. 

Many average Landlords struggle with the emotions of making business decisions. 

I hear many landlords saying things like the following:

-  Have not raised the rent in the past three years because the tenants are very nice.  

- The tenants appeared to be very nice when they looked at the property.

- My tenants submitted information that turned out to be false information. 

- The tenants damaged the property

These are a few signs the “business” owner is making a decision based on emotions not based on facts. In BC there are restrictions on when and how much rent can be raised. As a business owner you need to evaluate the economic facts of operating your property, and base decisions on those facts alone. If your costs are going up and the market supports a rent increase, raise the rent every 12 months, which is the allowable time frame. If the market is in a downturn and you can’t re rent the property for the same price or more than it is currently rented for then don’t increase the rent. 

Failing to do due diligence at the start of a tenancy when checking references for potential tenants creates a disaster for landlords. I have seen and heard many stories of landlords who thought the person was a good applicant, and when asking them how they came to that decision, it was mostly based on how they felt about the individual when they came to view the property. This is a decision based on emotion. I have met many potential tenants at viewings who come across as being very personable, yet the information on the application is inaccurate and references aren’t valid. 

Don’t judge a book by it’s cover, read all the chapters when being a landlord. 

Need assistance managing your rental property? contact us for an evaluation of your needs.

Cartref Properties specializes in managing rental units located within Strata Corporations.

www.cartrefproperties.com