• Are you willing to work with people?
• Do you have the discipline to stick to a long-term plan?
• Are you a good communicator?
• Can you diffuse potentially volatile situations?
• Can you deal with uncertainty?
• Are you decisive?
If you manage your investments correctly, your time as a landlord will be mostly uneventful; on an average month the only thing I have to do for a given property is walk to the mailbox and pick up the check. But occasionally you'll be called to handle an issue, deal with a tenant, or make a decision on a repair or an upgrade. Responding to issues in a timely, professional manner will ensure that you maximize the profit potential of your investments. It will also go a long way toward ensuring that you maintain a work-life balance that will keep you in the game for the long term. Most people don't think of real estate investors as being in the service business, but in reality you are. Your clients are your tenants; they're the key to keeping your investments profitable. Dealing with your tenants will be relatively pain free if you stick to a few principles.
• Invest in the right market segment: There are all sorts of communities out there to invest in, so think about what type of people you're comfortable dealing with and invest accordingly? Do you like dealing with higher end clients, or will you get annoyed by the rich college student who moves into your townhouse rental? What about working class neighborhoods?
• Create a relationship based on mutual respect and courtesy. Return phone calls promptly. Be responsible with repairs. Show concern for your tenant and they'll respect your time and your property.
• Communicate clearly, openly, and early. Surprises lead to misunderstandings, and misunderstandings lead to conflict. You control a very important element in the lives of your tenants: their home. Communicate early if you have plans to work on the property, to increase the rent, or any other change that will impact their lives.
The Author: Chris Smith is a real estate investor, founder of an online reference for investors and real estate professionals and has published articles in Corporate Finance Magazine, Euromoney, and the Business Journal Network. More about Chris Smith.