7 Things To Do Before Renting Your House
While renting your house out may seem as easy as posting an ad, we recommend that you set aside some time to prepare for your new business venture before you leap into the world of finding and managing tenants. Outlined below are seven essential steps that every new landlord should take
1. Get an Insurance Policy
Purchasing landlord insurance (also known as rental property insurance) is one of the most important steps to take before renting your home. In addition to the things covered in a typical homeowner’s policy, landlord insurance may protect you from damage, as well as from legal actions they may take against you. Be aware, though, that rental property insurance will not cover your tenant’s personal property—they’ll need to purchase rental insurance to cover their belongings, which is part of our services.
2. Enlist an Accountant
Assuming you’re not an accountant or deeply familiar with rental tax laws, it would be wise to enlist an accountant to help you sort through the tax implications of renting your house. An accountant will help you figure out what records you’ll need to keep in order to navigate Schedule E come tax time. He or she can also help you figure out how to minimize your tax bill. Generally property taxes break even so taxes are minimal – gains are taxable.
3. Have a Realtor Review your Lease Agreement
A real estate professional can help ensure that your lease agreement does not contain any illegal provisions, while also protecting you from the financial harm that could result from tenants exploiting loopholes in your agreement. A good lease agreement will specify the ways tenants can and cannot use the property, how many people can occupy the rental, what insurance is required, who is responsible for paying utilities, and what will happen if the tenant doesn’t uphold his or her obligations. Our lease agreement has has been tried and proven for many years.
4. Establish Criteria for a Tenant
Working with in Landlord and Tenants Act and guidelines, outline a set of criteria your rental applicants will need to meet, and put these down on paper. These criteria should include acceptable monthly income levels and credit scores and the number of tenants who may occupy the house. You should also lay out your smoking and pet policies – policies that our lease agreement will cover.
5. Get Your Paperwork Ready
Beyond the lease agreement, there are a number of forms you’ll need to have on hand before renting your house out.
6. Home Inspection
Having your home inspected by a professional will help you fix any critical maintenance issues before your tenants move in. This will help protect you from potential legal issues, while also saving you from having to answer multiple maintenance phone calls within the first few weeks of renting your property. Having home inspections both before a tenant moves in and after he or she moves out will also provide third-party documentation of any damage caused by the tenant. At the least – bring a friend in for a third party opinion!
7. Clean, Paint, and Landscape
There’s no substitute for a through thorough cleaning and a fresh coat of paint when it comes to brightening the interior of your rental home. While trendy upgrades may be optional, if you want to attract the most qualified tenants, this basic rental hygiene is required. Likewise, it’s important to make sure that the lawn and garden surrounding your rental house is neat and tidy before you post the “For Lease” sign.