If it’s your first time renting out a property, it can be a little nerve-wracking, and that’s normal. After all, there are various things that can go wrong in any situation. However, if you make ample preparations and learn the ropes, being a landlord willreap you many benefits.
To help you on this exciting journey, here’s a property management guide:
Preparing the property
Before you rent out your property, you need to check if safety measures are in place and up-to-date with regulations. These include smoke alarms, fire exits, plumbing, electrical, and HVAC systems, and infrastructure stability (such as the roof, walls, floors, and stairs). It is important to cover every base, to ensure that the property is safe for future tenants.
Make sure the property is free of environmental hazards such as mold or asbestos. Aside from these, check for any rodent or termite infestations. See if all the switches, outlets, doors, and other fixtures are working. If there are things that need to be fixed, get them done beforehand, so that the property is in top shape when you rent it out.
Change the locks
If someone previously lived in your rental property, it’s wise to change the locks before new tenants come in. This is to ensure their safety and to avoid any legal issues. While you’re at it, you might also consider switching to wireless door locks. If you intend to lease out your property in short-term intervals, it might be inconvenient to have to change the locks every single time. Wireless door locks utilize keycards or mobile phones to unlock, and you can remotely change the passcode rather than go to the property whenever the need arises, such as when a tenant loses their keycard. This also improves security and hygiene measures, since less people are involved in the process.
Finalize the lease agreement
This is probably the most crucial step in renting out properties. You need to make sure to cover any issue that might arise, from property damage to failure to pay rent. You should also stipulate any rules in the agreement. Are pets or visitors allowed? Can tenants sublease the property?
A lease agreement typically includes the following:
- Name of the tenant and landlord
- Term of the agreement (length of stay)
- Amount of rent and mode of payment
- Right of entry (conditions wherein you will be allowed to enter the property, such as for maintenance)
- Agreement for maintenance
- Accountability for damages (who will pay for repairs)
- Prohibition of disruptive practices and illegal activities
- Limits on tenancy
Once the agreement is drafted, run through it with a lawyer or legal expert. Afterward, discuss it with the tenant in detail, and make amendments if needed. Once both parties are satisfied, have the lease signed and notarized.
Get your first and last month’s rent
Before the tenant moves in, make sure to get the first and last month’s rent. Some landlords also ask for a separate security deposit, which is equal to a month’s rent, but the last month’s rent can also serve as the security deposit. The security deposit will serve as funds in case the tenant fails to pay for rent, and it can also be used to cover unattended damages when the tenant moves out. Include such terms in your lease agreement to avoid confusion in the future.
For ease in collecting rent, you can also ask the tenant to provide post-dated checks for each month so you don’t have to collect them monthly. This can be convenient for the tenant to avoid missing their dues, as long as they make sure the checks don’t bounce.
Consider hiring a property manager
You might be thinking that being a landlord is too much work and you don’t have time to spare. One thing you can do is hire a property manager. A property manager can oversee and manage a rental property for you. They are actively involved in all the steps, from tenant screening, to collection of dues, to arranging for repairs and maintenance, and more. They do charge for their services, but it can be worth it if you have a busy schedule, as being a landlord can take chunks of your time.
If you need help with property inspections and property management, Sundance Property Management provides full-service management for various owners of multifamily communities and manufactured housing communities in Ohio, Indiana, Kentucky, Tennessee, Georgia, North Carolina, and South Carolina.
Sundance can also manage all physical inspections to ensure your property is cared for and well maintained.