It’s entertaining to browse funny stories online about mistakes landlords make, but it’s no laughing matter if you’re the one who is the butt of the joke.

The truth is that there are many things you cannot legally do as a landlord. Other mistakes may not get you in trouble with the law, but they could cost you time, money, or worst of all, your tenants.

Knowing how to be a good landlord includes not only knowing what to do, but what not to do. In this article, we’ll discuss some common landlord mistakes, as well as how to avoid them as a landlord.

  1. Not Researching the Rental Price

One of the most common landlord mistakes is conducting little to no research before setting the rental price.

Some will simply pick an arbitrary number that will cover their costs while allowing them to make a profit. Others advertise the same price year after year without any consideration for market trends. The biggest faux pas is raising the rental price dramatically without considering local rent-control laws.

To avoid these mistakes, study rental prices for similar properties in your area. Factor in related costs of maintenance, insurance, and repairs. Make sure that the price you advertise is not only fair but compliant with the law.

  1. Using Generic Lease Agreements

No doubt you already know the importance of a written rental agreement. What you might overlook is the importance of a customized, state-specific lease agreement.

Those “standard” forms you find online might be free and convenient, but they can come back to haunt you later. For one thing, they’re probably not compliant with the laws specific to your city, county, and state. If they short-change your tenants’ legal rights, you could find yourself on the losing side of a legal battle.

On the flip side, a generic form could hold you to tighter regulations than your locale requires. As an example, many online lease agreements state that you must return a security deposit within 10 days. In California, the law gives you up to 21 days to do so.

It’s worth the time and effort to draft a rental agreement that’s compliant with both federal and local laws.

  1. Not Conducting Thorough Screenings

Did you know that 40% of landlord references are bogus? This is just one example of why it’s so important to properly screen potential tenants.

Even if you’re desperate to fill your property, don’t rush the application process. Pay for a credit report and criminal background check. Contact their references to verify employment and rental history.

It may feel tedious or even unnecessary, but it costs a lot more to evict a bad tenant than to screen for a good one.

  1. Asking Illegal Interview Questions

Did you ask a couple if they’re married or planning to start a family? Did you ask a disabled person for details about their disability?

Guess what? You just broke the law.

The Fair Housing Act has very clear, and very strict, guidelines about housing discrimination. Even if your questions are well-meaning and innocent, the applicant may view them as discriminatory.

Under federal law, it’s illegal to make a decision about potential renters based on their race, religion, nationality, or marital status. Get familiar with this important Act so you know what it’s okay to ask, and which questions could get you into trouble.

  1. Failing to Maintain or Repair the Property

As a landlord, you’re required to meet or exceed your area’s health and safety standards. These include state building codes, landlord-tenant laws, and local health ordinances.

Keep an open line of communication with your tenants. Keep up with routine inspections and maintenance tasks, after giving proper notice of course. Encourage your renters to contact you immediately if there are any issues with the property.

Remember that a small problem, if ignored long enough, can turn into a disaster. You don’t want to face a major repair bill or a lawsuit for negligence, or both. Do your due diligence by holding up your end of the lease agreement and keeping the property in good working order.

  1. Using Security Deposits Incorrectly

Most violations of landlord-tenant law center around security deposits. One of the most common mistakes landlords make is using their tenants’ security deposits in an inappropriate way.

For example, some landlords take money from the security deposit to make cosmetic upgrades or other unnecessary changes. Some fail to return the security deposit on time after the tenant moves out. Worst of all, some landlords spend their renters’ security deposit with no intention of returning it.

All of these actions are both unethical and illegal. Save yourself from a potential lawsuit by keeping those security deposits separate and returning them after the tenant moves out.

  1. Not Treating the Business Like a Business

There’s nothing wrong with being polite and friendly to your tenant, but your goal isn’t to make new friends. Your goal is to run a profitable business.

Maintain a professional distance in your landlord-tenant relationships. Don’t get involved in your tenants’ personal lives. Strive to be fair but firm at the same time.

Hold yourself to the terms of the lease, just like you expect your renters to uphold their end of the agreement. If your renters sense that you’re lax about the rules, they’re less likely to respect the rules themselves.

The Best Landlord Tips and More

From discriminatory questions to failing to maintain the property, there are plenty of mistakes landlords make. The last thing you want is to be one of them.

However, even the best landlords need help sometimes. That’s where companies like Genuine Property Management come in.

From screening tenants to providing 24-hour maintenance work, our job is to make your life as a landlord easier. We help landlords in San Luis Obispo and throughout Orange County better manage their properties, their tenants, and their rental business.

Contact us today to learn more about our unique services for landlords like you.