Owning property is a perk in itself, but renting that property to tenants is an entirely different process. There are many pros and cons to becoming a first-time landlord; even those who have rented for decades can stumble upon tenant surprises. Missouri residents who are considering renting out a property may want to pause on some of the advantages and disadvantages of the role of a landlord. New landlords might wonder, how does the process tend to work, and what do the experts do in tricky situations?
As with most new positions, there are many pros and cons to becoming a landlord. Financial resource The Simple Dollar examines the perks and the downsides to renting out a property to tenants. Above all else, renting a property to tenants can reap significant financial reward, as renters provide consistent income. Property values can also benefit landlords; depending on the area, the property could see an increase in value over time.
On the other hand, there is a fair share of disadvantages that comes with the role of landlord. The Simple Dollar acknowledges that opening the doors to strangers is not always an easy task, as some tenants may prove to be difficult as time goes on. There is a great deal of trust required in this process, as regular streams of income are dependent on tenant consistency.
Fox Business also provides some insight on what it means to become a landlord. A tenant's monthly rent payments can not only offer financial cushion, but can pay off the mortgage for the property altogether. Landlords can also subtract property expenses on income taxes. Some disadvantages, according to Fox, include the chance of another housing crisis; however, this may depend entirely on the housing market in one's area. There is also the risk of an empty rental, for which Fox encourages all landlords to be prepared. There are many pluses to owning and renting a property, as well as a number of downsides, and landlords should always look at every angle before opening the door to new tenants.