When you decide to relocate, the question that immediately pops up is what to do with your old house. Will you sell it, and if not, how to rent out your home? As a landlord, there are certain things that you should know how to do properly to avoid any complications and troubles with prospective tenants.
How to Rent Your Home and Why People Do It?
The reasons why people opt for renting out their real estate after moving out of it may be numerous. Maybe they don’t want to sell it because of sentimental value (inherited estate, for example) or because they see it as an investment property and a chance to boost their income. Or they want to sell, but the market isn’t favorable at the moment.
Whatever your reasons to move and to become a landlord, the first thing to do is make sure you go through all the relevant laws that regulate house rental. Many regulations are in place to protect your rights as well as the rights of your tenants. One of the most significant of those is The Fair Housing Act.
Since renting out a house is a business, there are also many financial and managing details that need to be worked out. You can do it by yourself, though it is recommended to hire a company to do it for you. Professionals can handle all day-to-day activities concerning collecting rent from your tenant and handling repairs.
In case you don’t want to move out of your home completely, you may want to put up only one room for rent. Splitting the mortgage with a roommate may be a good thing for your finances. Still, there have to be strict rules and even a lease agreement in place. Roommate websites are an excellent place to find potential roomie, and to make sure you’re compatible.
Prepare a House to Build Up Its Value
Before putting a home up for rental, there are certain things to do before the tenants move in. Property should be cleaned, first and foremost, so take some time to do it. It would be best if you also took detailed pictures of the entire property. That way, you’ll have irrefutable proof that your sofa wasn’t damaged, or that the wall was squeaky clean when the tenant first entered the house.
How to Rent out Your Home and Protect Valuable Things
When you become a landlord and put your real estate up for rental, you’ll have to get an insurance policy for the property. The most common of those, home rental or fire insurance, will cover the building structure, legal and medical expenses, and the loss of income. It won’t cover the renters’ belongings, so they should buy a policy for themselves.
Also, some of the more valuable things should get separate insurance, since damage can occur at any time. If you want to secure what you hold dear against anything that renters may lay upon it, consider stashing such things in a storage unit. Storage services should be on your list of requirements when choosing professional moving services.
Protect Your Rights When Renting out a Property
Looking after your interests should be the main reason for doing things by the book when it comes to renting out your real estate. Aside from insurance, you should make sure that the lease agreement for the property is airtight. Whether you choose to hammer it out with the help of professionals or to keep it between you and your tenant, it should always contain certain items. Here are the essential matters you need to address when you lease out a house:
- Duration– are you renting on a short-term basis or is it the more stable annual lease
- Financial matters– the rent, due dates and penalties, security deposit, liability for any damages
- The exact number of tenants who are renting and their names and personal information
- General rules– noise level, behavior, pets
- Terms of eviction
When it comes to eviction, it may be wise to hire an attorney to handle the matter, since it will almost certainly be settled in court.
Learn Everything You Can About Your Prospective Tenants
Renting out your property is a serious matter. You should know who’s renting, since expected income may prove too costly after the bottom line is drawn. So take your time to do a background check of your potential tenants. Ask them for contact information of their previous landlords, and go for at least three of them. Every person who puts his real estate up for rental should be aware of the habits of people he entrusts his livelihood with.
Also, make sure to contact the police as well. If your prospective tenant is a criminal, you may think twice about signing a rental agreement. It is common to let the renter know that you’re checking him. Spend some time getting info on the renters. It’ll pay out big. Recommendation (or lack of one) may speak volumes.
Hire a Professional Advisor
To wrap it up, we have one final piece of advice. You may feel you don’t need it, but hiring a licensed professional advisor to handle matters is a great thing to do. Leaving a pro to take care of financial details, lease agreement, and to make sure that you won’t be letting an arsonist into your property, will leave you more time for more comfortable activities. Why haggle on whose responsibility would be to mow the lawn when you can go fishing, for example. Or take kids to an ice cream shop.
Another advantage of a professional is that he won’t get too emotional with your renters. You, as a landlord, might, though you need that check every month. We’re all humans, after all, but mortgage won’t pay itself.