Accidental Landlord: From Stress to Success

Most people who become landlords do so intentionally. They seek out investment properties, buy units that they think will have broad appeal to tenants, and take steps to maximize the return on their investment. Yet some landlords fall into it unintentionally for one reason or another, such as a slow housing market or a job change.

Being an accidental landlord can be stressful, particularly because you may not have a strategy in place. You can take steps to ensure that your new venture is successful, whether you plan to be a landlord long-term or just want to hold onto the property until you can sell it. An experienced Hillsborough County property management company can help you work out the details and handle the day-to-day business of being a landlord for you.

Based in Lithia, Eaton Realty offers a range of real estate services for buyers, sellers, renters, and investors. If you have become an accidental landlord, we can help ensure your rental property is properly run and managed. Reach out today to talk to a member of our team about your rental units.

 

 

How Does Someone Become an Accidental Landlord?

An accidental landlord is precisely what it sounds like: someone who becomes a landlord by accident instead of making an active choice to do so. More people are accidental landlords than you might expect, particularly as the housing market cools down and inflation rates go up.

People become accidental landlords for many reasons. You may have to relocate for your job - something that is especially common in the Tampa region with so many service members stationed at MacDill Air Force Base. Other personal issues may also arise that lead to a decision to rent out your home, such as:

Job loss or other change in financial circumstances

A death in the family

Divorce or other change in family status

Housing market changes are another common reason for people to become accidental landlords. After the 2007 real estate crash, many homeowners couldn’t sell their houses. A Wall Street Journal study from that time found that nearly 1 in 5 landlords had no intention of renting out their house when they bought the property.

Current market conditions are also ripe for accidental landlords. Many homeowners were able to lock in incredibly low interest rates (around 3%) on their mortgages in 2020 and 2021. Now that interest rates are around 7%, these same homeowners don’t want to lose their low interest rates by selling their property. They may hold onto their house and rent it out to generate an additional income stream.

Fortunately, the housing market is nowhere near where it was in 2007 - but it has still cooled considerably from where it was over the past few years. Even if you want to sell your house, you may not get the price you want from buyers who are scared off by high interest rates. You may have even bought it at the height of the market in 2020 - 2021 before prices dropped over the past year. This may be another reason to rent your home instead of selling it.

Being an accidental landlord can be stressful. A lot goes into being a landlord, from understanding federal and state housing laws to drafting leases to handling maintenance requests. You will need a solid game plan for things like:

Getting the right insurance;

Staging your house;

Marketing your rental;

Listing it on rental websites;

Screening tenants;

Writing a lease with the appropriate provisions;

Dealing with issues like property damage or non-payment of rent;

Responding to tenant complaints;

Maintaining and repairing the property;

Handling evictions (legally);

Figuring out proper deductions from security deposits; and

Finding new tenants.

You’ll also have to figure out related issues, like taxes on rental income, depreciation, and the appropriate licenses and permits for your rental property (such as for short-term rentals).

This can be a lot for anyone to handle, especially if you are already facing a job relocation, family change, or another stressful circumstance. While owning investment properties can provide a passive income stream, it can also be a huge headache. Whether you’re fielding calls from tenants about a broken hot water tank on Sunday morning or figuring out how to deal with a tenant who decided to get a pet in your pet-free rental, being a landlord is often more involved - and more work - than people realize.

Tips for Getting the Most Out of Your Investment Property

If you have become an accidental landlord, you may not have a long-term strategy. You may not have a plan at all other than being able to pay your mortgage even though you aren’t living in your house. Fortunately, there is a good solution to your accidental landlord woes.

A property management company can handle all of the work involved in being a landlord for you. This frees you up to focus on your work and allows you to earn a passive income stream. Instead of responding to complaints and figuring out how to market your property to attract tenants, you can simply sit back and get a monthly check for your property.

A professional property management company will handle everything related to your rental property. At Eaton Realty, our property management services include the following:

Taking professional photographs and 3D videos of your property;

Marketing your house year-round, even while occupied, to ensure that it stays rented;

Posting your rental to the Multiple Listing Services (MLS), partner sites like Zillow, Trulia, and Hotpads, and our social media channels;

Screening tenants, including credit checks, background checks, and reference checks;

Scheduling appointments to show your property;

Tracking and managing repairs and maintenance requests, including after-hours;

Analyzing maintenance and repair trends to note patterns;

Using technology to document property condition, handle rent payments, and more;

Utilizing property management software that gives you 24/7 access to property reports, invoices, and year-end statements; and

Providing a comprehensive accounting of income and expenses.

We offer three pricing tiers that offer different levels of service depending on your goals as a landlord. If you ultimately decide to sell your property, we can seamlessly get it on the market and find a buyer. We can also advise you on additional investment properties with an eye toward strategic growth.

It is possible to manage your own rental property; many people do so. That being said, property management can be demanding. If you are still working full-time, it may be difficult to deal with all the little details involved in being a landlord.

Many became accidental landlords when they left Florida or the Hillsborough County region. This can make property management even harder, as you won’t be there to respond to issues, check on the house, or meet tenants. In this situation, professional property management is almost always necessary.

There are a lot of potential benefits to being an accidental landlord. Someone else will be paying your mortgage while you build equity. There are also tax incentives to being a landlord. Whether you plan to do it or not, being a landlord can set you up for long-term financial stability. Working with a property management company can increase the likelihood that your new venture will be successful.

How Eaton Realty Can Help You Manage Your Rental Property

Being a landlord can be demanding under the best of circumstances. It can be even harder when you’re thrust into the role by chance instead of by deciding to do so. A seasoned property management company can make the job easier.

Eaton Realty works with landlords throughout the greater Tampa-St. Petersburg region. We have deep experience in the Hillsborough County, Florida, real estate market, from buying and selling to renting and property management. Our goal is to help you achieve your goals as a landlord - even if you never planned to become one.

To learn more about our services, fill out our online contact form or call our office at 813-672-8022.