In today’s world of single-family rentals, surprises are rarely a good thing. This is actually true when those surprises come by means of unexpected costs or expenses. For the new real estate investor in Jamaica Plain, there might be several of these unwelcome surprises. But, it is important to know that by being aware of a few of the most common hidden expenses, rental property investors can be more prepared in the event that one or more do appear.
Every single-family rental owner needs a good quality landlord liability insurance policy. Although that doesn’t mean that the policy must be the most expensive one you can obtain. Insurance policy rates can vary widely, as can the quality and reputation of the company giving it. For this very reason, it’s important to shop around before choosing your landlord insurance policy and to check your rate annually for changes. Except if you are carefully comparing rates and insurance carriers, you may end up paying far more than you need to for your landlord insurance.
A second undesirable surprise could arise in the figure of a property’s utility bills. An energy-efficient property is one that has relatively low energy costs. But it is really important that new investors would understand that their newly acquired investment property comes together with a high energy price tag. Even though the reasons for this vary, there are several ways that property owners can carry out to make their rental property more energy efficient. Maintaining and keeping the house checked for air leaks, aging appliances, and other energy “vampires” can help you get a better idea of where the issues may lie. Replacing weather-stripping, single-pane windows, lightbulbs, and other leaky spots can go a long way into lower energy costs. Just by doing a few simple fixes and some annual maintenance, you can significantly reduce your rental home’s energy bills.
Erosion Prevention and Repair
Within the first year of having a rental property, each new season can bring surprises of its own. Warm spring weather sometimes reveals erosion issues that were not visible in colder months. In such instances, the cost of erosion prevention and repair may come as an unwelcome surprise. As soil is eroded from a home’s foundation, water can pool and result in damage. Securing that your rental home has proper drainage and has been thoroughly checked for signs of soil erosion is a great way to evade several unknown prevention and repair costs.
Even the best single-family property owners may face unexpected legal fees at a certain point. Working with tenants is rarely easy, and disagreements can and do happen. It’s true that budgeting for a future lawsuit is truly being cautious, but the most ideal way is to always do what you can to prevent a lawsuit in the first place. Performing regular maintenance on the property and responding promptly to repair requests is one of the best ways to begin. Additionally, ensuring your property is compliant with safety standards, gives basic safety equipment, and has been checked for hidden problems like mold, lead paint, or asbestos are all valid ways to secure and keep yourself out of the courtroom. Following your lease agreement, and encouraging your tenant to do the same, is an additional appropriate way to avoid tenant lawsuits and keep legal fees at bay.
Inadvertent Appliance Damage
The last unpredictable expense that may definitely surprise the new rental property owner is how quickly appliances seem to wear out. The cost of replacing major appliances every few years can have any investor feeling sticker shock. The trouble isn’t necessarily that tenants are abusing the appliances, but rather that they may be accidentally damaging them because of a lack of the right information. The other perfect method to keep your rental home’s appliances running longer and better is to educate your tenants on proper appliance use and care. By prodding them to use the appliances correctly and perform a few basic maintenance tasks, you can significantly extend the life of your property’s appliances.
Now that you know a handful of the more unexpected costs and expenses that come with owning single-family rental properties, you can be better prepared to reduce or avoid them. By being proactive with tenant education, property maintenance, and cost comparisons, you can better prevent many of the more undesirable surprises of real estate investing. At Real Property Management Boston, we can help guide Jamaica Plain investors through these unforeseen costs. Call 617-522-0099 or contact us online today!
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