There is no doubt that investing in property is a great business to be in if you are looking to make a great income.  However, there are a few things to consider before you take the first steps.  This is particularly true if you want to become a landlord.  Obviously, this is a great investment to have but there are a few drawbacks, not all of them financial.  You should consider all of these before you buy your first investment.

First, you need to consider who is going to manage these properties.  Most people start out doing it themselves and quickly discover that they are on call 24 hours a day, 7 days a week.  You will be called out to handle issues such as electrical and plumbing problems, leaky roofs, heating breaking down, noxious fumes and windows not opening.  Many of these problems happen at odd hours of the day and night and your tenants will have your number and will not be too shy at using it!

Second, every month you will have to collect the rent. You will hear all kinds of sob stories, some of them true, many not. It takes experience to discover which is which and a heart of stone to ignore the please of those in trouble.  It is this reason, above all else, that has the landlord reaching for the contact details of property management companies.  Unless you can treat rent collection, management and eviction proceedings as a business, you will never succeed.

Thirdly, unless you have great tenants and new buildings there will be an almost constant need for upkeep and repair.  Murphy’s law of rentals is that things will break in the order of their expense to repair.  Sadly, tenants often do not treat their rentals with care and there is always a need to clean, paint, repair and replace between renters, if not sooner.  This is time consuming and expensive and when you are between tenants, you are not receiving rental income.

Finally, there is the need to keep your property constantly occupied in order to pay your loans and maintain your income levels.  If you have a high turnover or bad occupants, this becomes more and more difficult.  Of course, one solution is to choose good tenants and treat them well.  This takes a mixture of luck and experience.  Anytime you have your property sitting empty, you are losing potential income.  Not only are you still paying the mortgage, you are also covering other upkeep costs that aren’t necessary when the property is occupied.  If you are lucky enough to find a good tenant, do everything in your power to keep them.  Even if you need to offer them some breaks, in the long run it will be worth it.

Owning property can be very rewarding financially and emotionally but it is a lot more work than many people believe it will be.  It requires long-term commitment, the holding of long term loans and a lot of work in upkeep.