More households are renting right now in the U.S. than they have been for the last 50 years. Are you considering renting out a house for the first time?
If you’re planning on becoming a landlord, there are a few things you need to consider first. After all, preparing to rent out a property to a tenant is a big deal. You want to make sure everyone is on the same page and you’re following all local laws.
Learn everything you need to know as we go over our top tips for renting a house.
- Prepare for Commitment
Before you rent out a property and take the leap toward becoming a landlord, you need to have the right mindset. Renting and managing a property is a business and you need to prepare for commitment.
As such, it’s important to present yourself professionally to your tenants as well as get ready to invest time and money on the property.
You’ll need to take time to research local laws, connect with a legal professional, and take time to inspect and maintain the property.
It’s also a good idea to set aside money for any unexpected expenses such as a burst pipe or accident. Investing in landlord insurance can help protect you in the event a tenant tries to sue you.
- Understand the Neighborhood
Location, location, location. If you purchase a property in a desirable neighborhood, chances are that you’ll attract quality tenants. You’ll also be able to ask more for rent.
Do your research on the area and ask yourself, what are the property trends? Understanding the real estate market can help you keep your rental rates competitive and also ensure your property stays in good hands.
Study demographics, proximity to public transportation, job trends, and places of interest like parks or shopping areas. Renters often pay more for perks like these.
- Maintain Your Property
You’ll attract more renters if you keep your property in good condition. This means you’ll need to invest a good deal of time and money into repair and maintenance.
First, begin by ensuring everything is in good, working order. Make sure the HVAC is running smoothly, check all the appliances, look for leaks, holes in the walls, chipping paint, or dirty carpet.
A little elbow grease goes a long way when keeping a rental property in good shape.
Make sure you have a plan in place for maintenance issues that arise when a tenant is staying there. Create a list of emergency numbers and put them in the rental agreement if anything serious comes up.
- Know Your Local Laws
Before you rent anything out, you must know your local and state laws.
There are some restrictions on renting out properties you’ll have to keep in mind. For instance, a homeowners’ association (or condo association) may not allow long-term rentals in a certain area.
There are also times you may have to pay extra fees or have regular inspections performed on a rental property.
To avoid any legal issues, it’s best to consult with a lawyer that understands real estate. Have them check your lease agreement and ask about any laws you don’t understand.
- Keep Everything Up-To-Code
This ties into the maintenance issue, but you should always double-check your property and keep things up-to-code.
Here are some basics to check:
- Test all smoke detectors and ensure there are enough per floor
- Test carbon monoxide detectors
- Understand the hazards of lead paint (follow EPA guidelines)
- Know the dangers of toxic mold and how to remove it
- Fulfill requirements for proper lighting and banisters in stairwells
- Understand safety laws concerning sidewalks or walkways
- Clean the vents and ensure they are in working order
When you’re renting out a house for the first time, you’ll need to understand and comply with state and local laws. Keep everything up-to-code to avoid accidents and potential legal issues.
- Require Background Checks on Applicants
Before you rent out a property, you should require all applicants to undergo a background check. Having a tenant screening process can put a landlord’s mind at ease.
Run background and credit checks on every adult applicant. Running a background check can tell you whether they have a good rental history, pay their rent on time, or have any evictions on record.
While background checks can eliminate many problems, there may be a time when you need to evict a tenant. Again, you’ll need to follow local laws concerning the eviction process and give a tenant time to fix issues.
If you do need to take legal action, use eviction services to ensure everything is by the book.
- Prepare a Rental Agreement
Before you rent, you’ll need a written rental agreement. This agreement should be legally binding and include all your expectations and rules.
A rental agreement is a contract between you and your tenant. It protects you in the event of a legal situation and outlines all rules a tenant must follow. Both parties need to sign the agreement before move-in.
It’s important to have a lawyer that specializes in real estate look over your agreement before you hand it to your tenant. A lawyer can tell you whether you’re following all local and state laws and give you suggestions for improvement.
Use These Tips When Renting out a House for the First Time
Taking the first step toward becoming a landlord is an exciting journey, but you need to prepare before renting a house.
When renting out a house for the first time, you’ll need to follow all state and local laws. Manage your property like a business, and prepare to invest extra time and money into it.
Use these tips to prepare yourself for your first tenant and ensure everything goes smoothly. And if you need more advice like this, be sure to check out the other areas on our site!