The Top 5 Mistakes New Landlords Make

Published October 28, 2025 at 8:26 pm EDT

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Becoming a landlord sounds simple enough. Buy a property, find a tenant, collect rent — easy, right?

But as many first-time landlords quickly discover, managing a rental isn’t nearly as passive as it looks on paper.

If you’re new to rental property ownership, you’re already doing the right thing by learning before you leap. To help you start strong, here are five common mistakes new landlords make — and how to avoid them so your investment stays profitable and drama-free.

1. Skipping Thorough Tenant Screening

It’s tempting to fill your property quickly, especially when it’s sitting empty and you’re watching the mortgage and utilities add up. But rushing to rent to the first applicant who shows interest is one of the most expensive mistakes a landlord can make.

A bad tenant can cost you months of lost rent, property damage, and legal headaches if an eviction becomes necessary. Even one bad experience can wipe out an entire year’s worth of profits.

Take the time to screen every applicant carefully. This means:

Running a credit check and reviewing payment history
Verifying employment and income to ensure they can afford the rent
Checking references from past landlords
Conducting a quick background check for red flags

It may feel tedious, but a thorough screening process is your first line of defense. If something doesn’t feel right, keep looking. The right tenant is well worth the extra time and effort.

2. Underestimating Maintenance Costs

Many new landlords assume that once a property is rented, it more or less takes care of itself. But the truth is, even well-maintained properties require consistent attention and upkeep. Roofs leak, appliances break, and plumbing doesn’t care that it’s a Sunday night.

One of the most common budgeting mistakes is failing to set aside enough money for ongoing maintenance and unexpected repairs. A good rule of thumb is to save about one to two percent of the property’s value each year for maintenance.

Keeping up with small repairs also prevents bigger problems. A leaky faucet today might become a water-damaged cabinet or floor tomorrow. Routine inspections and preventive care protect both your property and your peace of mind.

And if you own multiple rentals — or simply don’t want to be on call 24/7 — partnering with a professional property management company can make all the difference. They handle maintenance scheduling, vendor relationships, and emergency calls so you can stay focused on the bigger picture.

3. Setting the Wrong Rent Price

Pricing your rental correctly is part science, part art. Set it too high, and your property sits vacant. Set it too low, and you’re leaving money on the table every month.

Some new landlords price based on what they “think” the property is worth rather than on actual market data. But rent pricing should always be grounded in research — not gut feeling.

Study comparable listings in your area. Look at similar homes in terms of square footage, location, amenities, and condition. If possible, visit other rentals to get a firsthand sense of what tenants are getting for their money.

Online rental platforms can also give you a baseline for average rents, but don’t forget to factor in seasonality, as demand can fluctuate throughout the year.

4. Ignoring Landlord-Tenant Laws

When you become a landlord, you’re running a regulated business. Every state (and sometimes even city) has specific landlord-tenant laws that govern how you advertise, screen tenants, collect rent, handle security deposits, terminate leases, etc.

Ignoring these rules — even accidentally — can lead to fines, lawsuits, or major losses. For example, mishandling a security deposit is one of the most common legal missteps. Some jurisdictions require that deposits be kept in separate accounts or returned within a set number of days after a tenant moves out.

You also need to follow Fair Housing laws, which prohibit discrimination based on race, religion, gender, family status, or disability.

Before renting your first property, spend some time reading your state’s landlord-tenant handbook or consult a local real estate attorney. And if you hire a property management company, make sure they’re experienced in compliance — they can help ensure you stay on the right side of the law.

5. Trying to Do Everything Yourself

When you’re just starting out, you might feel like you have to wear every hat — landlord, maintenance tech, accountant, and even therapist when tenant issues arise. But trying to handle everything yourself quickly leads to burnout and mistakes.

Delegating is a sign of smart business ownership. A trusted property manager can handle day-to-day operations — including tenant communication, inspections, lease renewals, and rent collection — freeing you to focus on strategy and growth. That peace of mind is priceless, especially if you’re juggling other investments and responsibilities.

The Bottom Line

Every landlord makes mistakes at some point — it’s part of the learning curve. But the biggest difference between a struggling landlord and a thriving one is how quickly they learn from them. As you make mistakes, be sure to pull out the lesson and apply it moving forward. This sort of proactive approach will pave the way for future success.

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