While putting up your house for rent may seem like an easy job, it sure takes some groundwork at your end. So, before you leap into the course of finding and managing tenants, we have listed out the essential steps you must take for a smooth transition:
First and foremost, make sure you purchase the landlord insurance. Apart from the things covered in a typical homeowner’s policy, this rental property insurance (landlord insurance) will protect you from any major damage done by your tenants. However, remember that the rental property insurance will not cover your tenant’s personal property.
It’s always wise to hire an accountant to help you sort through rental tax laws of renting your house. Not only this, you would defiantly need an accountant to figure out what records to secure in order to navigate your income or loss. Moreover, a depreciation strategy to minimise your tax bills can be mapped out by the accountant.
Let a real estate lawyer review your lease agreement to ensure no illegal provisions and no financial harm from tenants exploiting loopholes in your agreement. An ideal lease agreement would state how would the property be used, how many people could occupy the rental property, who is to pay utilities, and the measures taken if the tenant doesn’t uphold their commitment.
Outline a set of criteria for eligible tenants and hand it out to the potential tenants. These criteria must include acceptable monthly income levels, credit scores and the number of tenants to occupy the house.
Apart from the lease agreement, there are other paper works you need to have before renting your house out. This includes rental applications, credit check authorization forms, and any disclosures your state requires, move in checklists, and move out forms and various notices to tenants.
In order to attract the most qualified tenants, the basic rental hygiene of cleaning and painting is required. Remember, the presentation of your house is what would drive the tenants to lay eyes on your house. Make sure to keep everything neat and tidy before you put out the “For Rent” sign.
On the whole, being a landlord can be a rewarding experience if you play your cards right!