Being a landlord sounds pretty straightforward on paper: you own a property, you rent it out, and the checks roll in. Easy, right? In reality, it’s a bit messier than that. A lot of landlords (especially new ones) find themselves bleeding money not because the property is bad, but because of avoidable mistakes. Let’s go through seven of the priciest ones and talk about how to dodge them.
1. Skipping Tenant Screening
The excitement of filling a vacancy can cloud your judgment. You meet someone nice, they’ve got cash in hand, and you’re tempted to hand over the keys. Big mistake. If you don’t check their credit history, past rental behavior, or references, you’re gambling with your investment. A couple hours of screening beats months of chasing unpaid rent or repairing damage later.
2. Putting Off Repairs
That “tiny” leak under the sink? Give it a few months and suddenly you’ve got warped cabinets, mold, and a bigger repair bill than you expected. Tenants also notice when you’re slow to fix things, which doesn’t exactly inspire them to stick around. Quick fixes aren’t just about saving money. They show you care about the property, and in turn, tenants are more likely to treat it with respect.
3. Using a Weak Lease
Too many landlords copy-paste something random from the internet and hope it holds up. A vague lease is basically an invitation for misunderstandings. Spell everything out: rent due dates, late fees, who handles lawn care, what happens if a tenant breaks the lease early. The clearer you are, the less room there is for conflict.
4. Forgetting About Vacancies
Every landlord has downtime between tenants, but many don’t budget for it. Mortgage, taxes, insurance; those bills don’t stop just because the apartment is empty. A good rule of thumb is to stash away at least one month of rent each year to cover vacancies. If you don’t need it, great, but when you do, you’ll be glad it’s sitting there.
5. Mismanaging Taxes
Taxes can be overwhelming, and honestly, a lot of people just wing it. That’s risky. You could be missing deductions, filing incorrectly, or leaving serious money on the table. Did you know that understanding cost segregation study rules can unlock bigger depreciation benefits for landlords with multiple properties? If you’re not a numbers person, hire someone who is. An experienced accountant can save you way more than they cost.
6. Skimping on Insurance
Regular homeowner’s insurance usually doesn’t cover rental situations. Without landlord insurance, you could be out thousands if a tenant damages the place or someone gets hurt on the property. It’s not the most exciting expense, but neither is a lawsuit. Talk to your agent and make sure your policy actually fits your role as a landlord.
7. Treating It Like a Hobby
It’s easy to think of renting property as a side hustle. The problem is, side hustles sometimes get side-tracked. When you treat being a landlord like a proper business, you make smarter choices: you keep records, plan for expenses, know the laws, and act professionally with tenants. Even if you only own one property, the mindset shift makes a huge difference.
Most landlord mistakes come down to being reactive instead of proactive. If you wait until something breaks, a tenant leaves, or the IRS comes knocking, you’re already behind. Think ahead, stay organized, and remember that your rental is both a home for someone else and a business for you. Get those two things right, and you’ll avoid the most expensive traps.
