Owning and operating a property for producing income from rent can be a profitable endeavor. It can also be a costly undertaking.

Most first-time landlords are only concerned about finding a responsible tenant that is willing and able to make monthly rent payments. Of course, having that tenant is important, but there are other considerations.

There are considerable costs that can be incurred when owning a property for rental income. Maintenance and repairs are often needed because of:

• Heating problems

• Indoor decoration (paint, wallpaper, cleaning)

• Replacement of carpets

• Electrical appliances that need repairs or replacement (washing machine, refrigerator, dishwasher, stove)

• Landscaping issues

• Plumbing, including drains and gutters

• Door and lock repairs and replacement

• Exterior maintenance, including painting

What you cannot do yourself you need to hire someone to do. Appliances such as stoves, hot water heaters, and dishwashers need to be repaired or replaced when they stop working. And there is just no way around that expense when they stop working.

Property taxes need to be paid when due, as do any special assessments. If there are homeowner or condominium association fees, they too need to be paid each month. All of these kinds of expenses can suddenly make what would have been a profitable rental property investment a problem property. At best, the property can become a marginal income property. And if the tenant is problematic, such as not paying rent or causing damage, any hope of profit is lost.

Keep in mind that rental properties can be a source of income and significant profit, or they can become costly problems.