Renting out your property is always a difficult thing. Finding the right tenant is not easy. You need to start with a decent screening process and even then, there’s a risk that you’ll make a mistake. On the other hand, a landlord has some responsibilities, not just privileges. It is their responsibility to legally protect themselves, as well as provide decent living conditions for their tenant. Other than this, there are a couple of tricks they can use in order to increase their rental income. With that in mind and without further ado, here’s what you should do before renting your property.
1. Get an insurance policy
The first thing you need to consider is getting a landlord insurance policy. Even with the best screening efforts, it’s impossible for you to know who exactly is your tenant. So, you need to make sure that the majority of your property is protected. Major damage to your property is something that can happen for a number of reasons. Sure, your tenant may be a great person but they may have a bad taste in partners or problematic friends. Keep in mind that getting landlord insurance or rental property insurance is the only way to protect yourself from this eventuality.
2. Ensure that property is rentable
There are several things you need to take into consideration when planning to rent out a property. There’s something called basic livable conditions. If the home’s installations are faulty, it’s unethical to rent it out, even if the future tenant doesn’t notice this during the first visit to the place. Signs of structural damage need to be mended and, if there is any sign of pests, make sure to look for suitable termite treatment. The key thing is that the place is clean, safe, and functional. Beyond that, your potential tenants have the right to choose whether they like the place or not.
3. Accountant and a lawyer
Another thing you need to take into consideration is the importance of consulting professionals. The most important thing worth taking into consideration is the matter of earning this money the legal way. First, you need to get familiar with rental tax laws. This will ensure that all your financial dealings are legal and that you won’t bear any repercussions for it in the future. As far as the lawyer, you need an iron-clad contract with your tenants. This way, you have legal mechanisms that you can employ if things go south.
4. Projects to raise the rent value
The better the place, the higher the rent value, the problem is that some improvements simply aren’t cost-effective. How so? Well, you can only add so much to the cost of the rent per home improvement, and with some improvements, it will take years until you get your money back. This is why it’s so important that you explore this topic to the furthest extent. For instance, kitchen renovation and curb appeal improvements may disproportionally increase your rental income. The same goes for painting and introducing some easy fixes.
The last thing worth mentioning is the importance of taking an entrepreneurial approach to this whole matter. As a landlord, you’re an entrepreneur and you need to act as such. Your assets are making money, which means that they need to be invested in and properly maintained. You owe the taxes and need legal protection from various potential outcomes. As soon as you start looking at things this way, the easier it will all become. Overall, you have a lot of work to do but, in the end, it will all be more than worth it.