Encountering surprise expenses when you’re renting out an Everett property can be unpleasant. If you’ve created a careful budget, it only takes one unexpected maintenance bill or longer-than-planned vacancy to knock you off track.
It’s difficult to expect the unexpected, and it’s even harder to avoid the inevitable costs of renting out properties. Make sure you know that these costs are going to be part of your process when you’re renting out an Everett home.
Unexpected Vacancies and Turnovers
Hopefully, you’ve worked the cost of potential vacancy times into your financial planning. There will be gaps in your rental income, when you’re preparing the property for a new tenant or even if an existing tenant breaks the lease and moves out early.
There’s more to it than just the missing rent, however.
Maybe you have budgeted the cost of losing your rental income during turnover periods, but have you included things like landscaping, pest control, and security? These expenses are going to be incurred by you without the benefit of any rental income to offset them when the property is vacant. You’ll have to pay to keep the utilities on, and there are likely to be repairs needed after one tenant moves out.
Unexpected and Emergency Repair Costs
You won’t know that you have a problem with the plumbing or a sewer line until your tenant calls to report that there’s a sudden leak and water is everywhere. You’ll have to fix an emergency like this right away, and it’s unlikely that you’ll spend less than $1,000 on a major plumbing fix. If the home is damaged to the point that it’s not habitable, you’ll also need to pay for your tenants to stay elsewhere until the repairs are complete.
Heat is required during cold Everett winters. If the heat goes out on a cold night, you may find yourself replacing a furnace, and that’s going to be expensive.
Avoid these surprise costs with preventative maintenance. If you’re having your system inspected and serviced annually, you can reduce the likelihood of an emergency.
Replacement and Repair Costs
It’s hard to make a maintenance budget, even if you have a rental home that’s fairly new and in good condition. It’s often a surprise when you have to put in a new roof or replace some appliances. Many owners will set aside a portion of the monthly rent that’s collected to avoid these surprise expenses during a tenancy.
Understanding the life expectancy of small things like paint and large things like your roof is also important. If you know your air conditioning unit is going to last 15 to 20 years, anything past the 15-year market could mean that you have to replace the entire system. With any system or appliance, you know you’re getting lucky if 10 years have come and gone and you haven’t needed to repair or replace it yet. You don’t want to rely on luck, however. We recommend that you keep a maintenance reserve to handle the emergencies as necessary.
Removing a Bad Everett Tenant
Things can go wrong with tenants, and a lot of owners are surprised to find out what it costs to evict or otherwise remove a tenant who isn’t paying rent or not following the lease. You’re missing a lot of rental income when you have to evict, and there will be additional court fees even if you are successful in evicting a tenant.
Maybe it won’t even go as far as eviction. Maybe you won’t receive rent for two months and after all your notices and the official filing for eviction, the tenant will move out before it goes to court. That’s still a lot of rent you haven’t been able to collect.
Avoid bad tenants with a careful screening process, a strong lease, and a tenant relationship that’s both positive and professional. When you work well with your residents, you’re less likely to find yourself evicting them or managing tenant conflict.
If you need help budgeting or avoiding unexpected costs when you’re renting out a home, contact us at Real Estate Gladiators. It’s just one of the things we do as your Everett property management partners.
