March 30, 2022
What to Take into Consideration Before Renting Out Your Property
Despite the economic problems caused by the COVID-19 pandemic, property investment remains profitable. With careful planning, renting out a property can offer a reliable source of revenue over the long term. If you want to rent out a property, you have to market it, do paperwork and take on various other responsibilities. Finding the right tenants, doing maintenance, and ensuring there are no delays in rent payments can be challenging. Here’s what you need to consider before renting out your property.
How much rent can you charge?
You can’t ask for more than the prevailing market rent rate, so you need to do some research before deciding what rent to charge. Fixing it higher than current rent trends in an area will make it difficult to find a tenant. Fixing it too low could mean you won’t make enough return on your investment.
You also need to take location, size, property age and other factors into account when determining the rent you can charge. You can include certain costs like electricity and Wi-Fi in the rent or make tenants responsible for these. You will need to be very clear with tenants about any cost implications for them other than monthly rent.
If you want trusted property managers in Atlanta, the leasing team from Evernest, Mynd, Home 365, Advantage and other reputed services can help you to determine the right price for your home. You will also get help with marketing to prospective tenants, tenant screening and much more.
Have you taken all the costs into account?
When renting out a property, you are still responsible for property taxes. Taking out landlord’s insurance is probably more than worthwhile to cover possible risks of having tenants on your property. You will still have maintenance costs on the property, too, and the older the property, the more expensive these costs will be.
If you have a mortgage on the property, you need to be sure you can cover the monthly payments. You don’t want a situation where tenants default on rent, and you can’t pay your mortgage payments. It helps if you have some cash reserves available. You may qualify for certain tax deductions, and it’s worth finding out which expenses may be deductible from an accountant.
Does your home look well cared for?
If your home is competing with another one down the road, it needs to be in good shape and look well cared for. The interior and exterior of the house should be clean. A fresh coat of exterior paint and a well-mowed lawn can create a favorable first impression.
Inside the home, make sure that all appliances are in good working order. Doors and windows should be in good condition. The health and safety of future tenants may be compromised if appliances aren’t working as they should, the roof is leaking, etc. If a home looks well cared for, it is likely to attract tenants who are willing to pay a little more.
How will you market your home?
When marketing your home, you will need to focus on what is desirable to tenants. Stainless steel appliances, granite countertops, and hardwood floors are just some of the terms you can use in ads to attract their attention. Tenants also want to know about appliances like washers and driers, air conditioning etc. Having a property management company to market your home for you will ensure that you get tenants quickly because they know exactly where to advertise.
How will you screen tenants?
When screening potential tenants, you need to run a credit check, speak to previous landlords, verify sources of income, and look at personal references. Following these procedures helps to ensure that you find reliable tenants you can count on to pay their rent and pay it on time. Finding reliable tenants who not only pay well but will stay in your home and look after it properly can make a real difference.
Do you have a suitable lease agreement?
A lease agreement is a binding legal document. You need to have a written lease agreement in place signed by you and your tenants if you want to rent out your home. . It should clearly outline all the terms and conditions of the lease, including the monthly rent amount and length of the stay. It should define your responsibilities and the tenant’s obligations. It must clearly state any house rules. You can also include a penalty clause for leaving the property before the lease term is up.
If you draft a lease agreement yourself, it is worth having a lawyer check it out to make sure you haven’t omitted anything that could expose you to risk. Renting out your home can be beneficial to you and your tenants as long as you take the time to address and prevent potential problems.