Learn about property management 101
Once the property is ready to rent, it’s time to familiarize yourself with the details involved owner. Here’s a look at the basics when learning how to rent out your home.
Create your rate
A major part of the rental process is setting an appropriate price for the unit.
The best place to start is by researching local listings for real estate and other rental apartments. Find similar properties for rent in your area. One great tool for researching comparable rental rates is Rentometer. It can narrow down the rental rates for similar properties in your area in a few seconds.
In addition to market rents in your area, you should also consider your expenses associated with the property. Expenses may include general maintenance, mortgage, property taxes, insurance, and major repairs.
In the ideal situation, the rental price will cover all your expenses related to the property as well as some profits. But in the end, you will most likely be able to charge market rental rates regardless of your expenses. Make sure that the potential rewards outweigh the expenses that you will have to cover.
Consider a lawyer
When you decide to rent a home, you are wading into a new legal arena. You will need to make decisions when writing contracts, going through tenant laws, risk mitigation And understand tax opportunities.
Although it is entirely possible to handle these decisions on your own, it can be beneficial to hire a real estate attorney that you can refer to. With the help of a lawyer, you can confidently make the choices that work for you.
Working with a lawyer can be expensive. But knowing them can save you from expensive headaches in the future.
Signing a contract
Whether you decide to work with a lawyer or not, you will need to enter into a contract. The contract you use with prospective tenants should cover all possible situations that you and your tenant might encounter.
Take some time to consider questions about these important elements of any rental contract. Don’t leave anything out!
- pet policies: Do you allow pets? If so, are there size or breed restrictions to consider? If the tenant has pets, will there be any additional fees associated with the concession?
- Illegal activities: What are your policies regarding illegal activity on property?
- Late fees: If the tenant misses the deadline for paying rent, what fees will be charged?
- Maintenance and repair: What is the process for a tenant to report maintenance issues?
- Breaking the lease: Can a tenant leave the lease early? If so, what fees or restrictions will you impose?
- Application Fee: In the screening process, are there any fees for tenants to be aware of?
- Security Amount: How much, if any, security tyrant will the tenant need to ask up front?
You can find standard rental contracts online for most regions. But you should take the time to customize the lease to your exact specifications. Otherwise, you and the tenant may have disagreements.
Screen potential tenants
With the property ready to go and make the contract, it’s time to show the property. It can be tempting to rent out the space to the first tenant who shows interest. But it is important to Screening potential tenants To make sure it will fit well.
First, you’ll want to know how many people will live on the property. Additionally, you should ask about employment, income, and credit score. You can verify this information with payment slips and credit reports.
In some cases, you may decide to ask for references to assess the individual’s personality. But ultimately, the point of the screening is to ensure that the potential tenant is able and willing to pay rent on time while keeping the property in reasonably clean condition.
Learn about landlord and tenant laws
All landlords will need to familiarize themselves with the landlord and tenant laws. These laws exist at the federal, state, provincial and local levels to establish fair ground rules for landlord-tenant relationships.
The best place to find out more about the laws that apply to your site is US Department of Housing and Urban Development.
Learn about the Fair Housing Amendments Act
fair housing laws It is designed to protect the rights of all individuals seeking to purchase or rent housing. the Fair Housing Amendments Act It makes it illegal to discriminate against potential tenants on the basis of race, color, national origin, religion, sex, family status, or disability.
There are some limited exemptions from this law for owner-occupied buildings that are less than four units and single-family homes that the owner rents without the assistance of an agent. But you don’t want to be found in violation of the Fair Housing Act. With that said, it’s smart to make sure you always comply.