Initially, some investors want to be immersed in real estate by taking care of one or two rental units. After a while, they find out they prefer to be full-time landlords.
If you’re one of them and want to switch from being a part-time landlord to being a full-time one, read this article to learn more.
Advantages of Being a Full-Time Landlord
Going full-time into managing your investment property isn’t a role everyone seeks. But it carries plenty of benefits that draw in landlords. Among them are:
Monthly Cash Flow
As a full-time landlord, you’re able to keep your attention on your rental. As a result, you can optimize the cash flow from your unit leading to higher rental income each month.
Another upside to real estate is the lifestyle flexibility it offers. With a regular job at set hours, you must follow your superior’s work orders and stick with a fixed working schedule. You’d also need to comply with the number of vacation days assigned per employee.
Full-time landlords, on the other hand, can enjoy two-hour meals to catch up with a friend in the middle of a workweek. You can also go on vacation for more than a month. Your time isn’t constrained by company policies.
There are tax savings that come with investing full-time in real estate. You can maximize the property-related deductions.
Though part-time landlords also experience these perks, it’s further strengthened for full-time landlords.
Tips for Smoother Switching from Part-time Landlord to Full-time Landlord
It can be nerve-wracking to let go of your regular job and decide to focus on being a full-time landlord. But the rewards are great, you just need to handle the switch up well.
Here are helpful ways to accomplish this:
Have a Cash Reserve
Since you’re entertaining the idea of focusing on being a full-time landlord, you should be adequately prepared. Check your time frame. Is this going to be in the next year or two? It’s best to save up and have a cash reserve.
Make sure to set aside three to six months of living expenses but it’s advisable to allocate a fund for a year of expenses if you have no more full-time income. This gives you less stress if you have to deal with business issues.
You can start by computing how much your monthly cost of living is. Then multiply it by the number of months to a year. It’s important to focus on the basic things you need such as food, shelter, transportation, and healthcare.
Entertainment and other non-essential purchases need to be pruned so you can reach your set budget goal and switch to being a full-time landlord with fewer worries.
Build Your Portfolio
If you’re planning to transition into a full-time landlord, ensure you own two or more rental homes before doing so. The reason behind this is you want a larger rental income to fall back on and want to be certain that you can take on the landlord tasks which can also be demanding.
If you already own plenty of rental spaces, you can assess whether being a full-time landlord is really what you want and you can see yourself solely doing it.
Search for Mentors
Real estate has a lot of challenges to face. But with the right network, it’s easy to manage them. That’s why you need to work on being around more experienced people who have more expertise compared to you.
Having a mentor allows you to limit common landlord mistakes and sidestep costly mishaps. Challenges are foreseen by mentors and they can easily help you resolve them in several ways you aren’t aware of.
In fact, having mentors can provide you with a ton of opportunities since they also have a solid network and can offer up greater resources than you have.
No matter how your job frustrates you, resist leaving on bad terms. Even if you think you won’t be needing a job reference from your old company, you never know when you’ll be needing a referral from them.
It’s not advisable to burn bridges at all. Remember that as an entrepreneur, you need to have a reputable business image. You also want to keep your network solid since you might decide to stop being a full-time landlord in the future.
Hire a Property Management Company
As a full-time landlord, you want to protect your time so you can focus on your goals. For this reason, it’s recommended to hire a property management company to handle your rental units.
This way, you have access to a professional team who will attend to the small details and resolve property issues that can eat up a lot of the DIY landlords’ time. Your time and energy are best reserved for growing your real estate portfolio and attaining regular returns. This allows you to benefit from passive income.
Generally, property owners invest in one property per quarter of each year. In two years’, time, you’d be getting 8 properties, which leads to sufficient income to live on without taking on another regular job with fixed hours.
With SGI Property Management Dallas as your partner, you also enjoy investor services. We help you expand your earning opportunities, optimize cash flow and reach your investment financial goals.
We offer full property management services such as marketing, tenant screening, lease drafting, rent collection, finance reporting, managing evictions, and property maintenance and repair. For a hassle-free rental business operation, contact us today!