Renting out your property might seem like an easy way to increase your passive income, but early in the process you might find it’s more complicated than you expect. Your home can sit on the market for months without a rental seeker because it is priced above market rent. A bad tenant may be late or outright refuse to pay their rent; they have the potential to cause thousands of dollars in property damage and can ignore your attempts to evict the property until the authorities are involved.
So how can you avoid the hassle of these common difficulties associated with renting a property? Here are five things to do before renting out your home to reduce the risk and stress of being a new owner.
1. Take pictures of the property
Photographs of the property are necessary for several reasons. They are an important part of online advertising – otherwise favorable rental listings without photos of the property are often ignored by potential tenants as they don’t want to have to wait for a home viewing to find out the property is not available. has no layout or design that suits them. These photographs will also be useful during the move of your future tenants, as you can use them to measure the material damage that has occurred during the rental period.
2. Evaluate the fair market rent
While it may be tempting to charge higher rent to recoup money from recent renovations you may have done or moving costs from the time you left the property yourself, the best thing to do is to do some market research: check rental websites, newspapers, local landlords. , real estate agents and property management companies to determine the rental price of properties of a similar location, size and condition.
3. Create a concise and effective rental application
An effective rental application will not intimidate potential tenants with its length, but will be comprehensive enough to be used for tenant screening purposes. Any additional information you need from the tenant if they pass verification can be included in the lease documents. A good app will have spaces for the following:
- Last name
- Date of Birth
- Social Security number
- Phone number
- Current/previous addresses (last 7 years including owner’s name(s) and contact details)
- Current employer (name, address, date of hire, income, contact information)
- Authorization to Obtain a Consumer Statement
- Signature of the tenant
4. Consider using a property manager
Property managers typically charge a percentage of the monthly rent for their services, but in return they take care of things like finding new tenants, creating/signing leases, collecting rent, and issuing reviews. legal (including evictions). Hiring a property manager reduces the benefits you will get from rent payments from your tenants, so you need to carefully consider the cost-benefit of these services.
5. Find good tenants
Finding a decent tenant is easier said than done – many applicants can be friendly, polite and seem like a good fit, but this will create a flood of problems for you. The best way to improve the quality of the tenants you rent to is to conduct tenant background checks, that is, to choose tenants based on measurable tax and rental liability. Most landlords will charge prospective tenants an application fee to cover the cost of screening tenants.