A growing number of Dallas homeowners reportedly are holding onto their former homes and opting to become landlords. This explains one of the reasons for our low inventory of homes for sale. Every home that becomes a rental property is one less home for sale.
One of the reasons for becoming an unplanned landlord is the low interest rates many homeowners have on their mortgages reports CNNMoney. Few folks want to give up rates under 4% and are finding it easy to help fill the demand for rental properties in Dallas.
While becoming a landlord can work for many homeowners, there are challenges to leasing your property. The monthly rent needs to cover:
- the mortgage,
- any HOA dues
- with about 10-15% extra for repairs. You might be able to tolerate a tricky garbage disposal or gate that refuses to latch, but your tenant won't.
In addition to repairs, novice landlords need to plan for covering:
- expenses when the property sits vacant,
- the cost of leasing the property,
- running background checks,
- collecting rent,
- changing locks,
- cleaning and touch ups between tenants,
- following all landlord laws and legal requirements,
- dealing with demanding tenants.
If you don't want to deal with some of those issues, you can always hire a property manager for about 10% of the monthly rent. A property manager will typically collect rent, deal with any tenant calls and help keep you legal. You still pay for all repairs, cleaning, lock changes, etc.