If you’re renting out a home in Chula Vista for the first time, you might wonder whether being a landlord is going to be easier than you expected, or more difficult.
There are some great rewards – rental income, for one thing.
There are also challenges. You’ll have to understand some pretty complicated laws. You’ll also have to find a tenant, collect rent, and keep your rental home well-maintained.
Let’s talk about some of the pros and the cons of becoming a landlord and how Chula Vista property management can help.
Pros: Benefits of Becoming a Chula Vista Landlord
The best part of being a landlord is that you’re earning short-term cash flow and long-term ROI. The California real estate market is expensive. It’s not easy to enter it, and if you already have a property, you’re in a great financial position.
Tenants are paying your mortgage and contributing to the expenses that come with owning a home. Unless your property is paid off, you’ll have to pay the mortgage every month as well as property taxes, insurance, and other expenses. The rent you earn from your tenants will contribute to those costs and in some cases, pay for them entirely. That’s what is meant by passive income.
Don’t forget the tax benefits. The deductions you can take on your property definitely belong in the “pro” column. At tax time, you’ll have to declare what you earn in rent as income, but the deductions will protect you against any extra tax liability. You can write off your property management fees, the cost of maintaining your home, any mortgage interest, and you can also claim depreciation.
Cons: Challenges to Being a Chula Vista Landlord
Being a landlord takes a lot of time. It’s easy to underestimate what’s involved. It’s not as simple as finding a tenant and collecting rent. You’ll need to invest a lot of time and resources in showing your vacant home, screening tenants, responding to maintenance needs, and managing the turnover process between tenants. You’ll also need to manage financial details and document inspections. Unless you have a lot of free time, you may start to feel like you’re working a second job.
Another challenge is that you’ll need some cash available to you. Renting out a home can be profitable, but a tenant might call at any minute to report an emergency. Keeping your property habitable requires a maintenance reserve. Make sure you’re financially stable before becoming a landlord.
You may find there are a lot of unexpected costs. Vacancy, turnover, and evictions are all expensive and they’ll quickly eat into your profits. It’s hard to budget for how long it will take to make a home ready for the rental market between tenants. Be prepared for these, and always budget more than you’ll actually need.
Finally, in California, laws and legal obligations are complex. There are a lot of rights provided to tenants. You need to understand rent control, fair housing, evictions, and security deposits. You need to know the difference between a pet, service animal, and companion animal.
Professional Chula Vista Property Management
If you want to enjoy the benefits of being a landlord without falling victim to those challenges, work with a professional Chula Vista property management company. We can use our resources and expertise to provide a great rental experience for you and your tenants. The result is often higher incomes, lower expenses, and fewer mistakes.
Please contact us at Encore Realty for more information about how to become a Chula Vista landlord and what you can expect from us.