Everything I wish I knew before becoming a landlord

Simone Boer has seen a thing or two as a landlord. Since buying her first investment property — in her own neighbourhood of Lara, near Geelong, during the GFC in 2008 — Boer has gone on to become the owner of nine residential and two commercial properties, spread across the nation.

A 43-year-old mindset and business coach, Boer says being a landlord continues to throw up surprises. “I can confidently say that I am still learning every day,” she says.

However, she has, over the years, developed some non-negotiable practices, based on experience. Here are three things she wishes she knew when she was starting out.

There are things you should know before becoming a landlord. Credit: iStock

A good property manager is recommended

”It’s tempting to go with the cheapest option, but a good-quality property manager is worth their weight in gold,” Boer says. “They can help provide you with accurate appraisals and proper marketing, and get tenants in in a timely manner.

“Not only that, but they also ensure that the tenant’s rights and responsibilities are explained to them, so expectations are set from the get-go.“

Boer learned the value of a good property manager early in her investing journey, when one of her properties was leased to a young couple with no rental history. They got a large dog without permission, and by the end of the tenancy, the carpet was eaten, internal doors needed painting and external doors needed replacement.

“A better-quality property manager would have flagged these issues earlier, enforced boundaries and escalated sooner.”

It’s important you read every inspection report

“Never skim inspection reports,” Boer says. “Stay vigilant, insist on regular inspections and act on small maintenance issues early. They often signal bigger problems down the track.“

Boer found this out the hard way when she got complacent about her investment properties after having a baby.

“A property manager had flagged one property as ‘a little grubby’, but I didn’t follow up. Later, we decided to sell that property and discovered it had not been cleaned throughout the entire tenancy: there was visible mould on windows, dust build-up on fans and sills, and the shower needed full regrouting.

“When I went to retrieve the past reports, I discovered no inspections had occurred for over three years, and the last one, which was an online inspection, wasn’t even sent to me.“

Delaying difficult decisions can end badly

”If the tenant is not looking after your property, work closely with your property manager to create a clear game plan to get that tenant back on track, and exit them at the earliest convenience,” Boer says.

”I’ve made the mistake of giving second chances — to property managers and to tenants — that led to major problems.”

Once, when a cornice fell off in a bathroom, Boer completed the repair and asked the property manager to conduct an investigation. It didn’t happen.

When she decided to sell the property, she found out that it had been used as an overcrowded university house share.

“The cleanliness and smell of the property meant that it needed a full repaint and deep clean. I should have changed property manager, and tenants, earlier.”

The safety net

There are a couple of rules that Boer didn’t need to learn; she’s followed them from the beginning. Firstly, don’t get emotionally attached to your investment properties (“Even though I’ve lived in some of them, I’ve always treated them like a business,” she says), and secondly, always take out landlord insurance.

“I’ve never made a claim on landlord insurance,” she says. “I possibly should have when the dog did all that damage, but the tenant promised to pay for it all.”

However, Boer has seen how landlord insurance can act as a safety net when things go awry. “My friend made a claim after a tenant left their property in such disrepair upon vacating that it was unliveable. Insurance covered the deep clean of the property, the ability to ‘make good’ the property, and compensated for lost rent.

“I consider it essential. I would never rent out a property without it.”

Terri Scheer is Australia’s leading landlord insurance specialist. For more information, visit terrischeer.com.au.

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