There are many questions people ask themselves when thinking about renting their property and many factors to consider in order to protect their investment. Whether it’s because you have been transferred from the area for work but plan to return in the future or you realize the potential monetary gain from the property and add to your financial future, it is important to determine if you are prepared to become a landlord before you commit your property.
To avoid the horror stories you hear from unprepared landlords (ravaged properties, unpaid rents, and lengthy evictions), it is imperative that you make the right decisions in the very beginning of the renting process. The following recommendations will allow you to minimize hassles and avoid letting those tenant horror stories hold you back from what can be a lucrative and rewarding decision.
Employ an Experienced Property Management Company.
Although research is required to choose the property management company that best suits your needs, it is wise to have a professional management team on your side. The number one tool to make educated decision on accepting renters for your property is background research.
The best property management companies will provide professional photos and detailed descriptions of your home, and market through the most effective websites and avenues to attract the most qualified tenants for your property.
These companies boast property managers, who are well trained in researching tenants and have tools to effectively research criminal background records, credit reports, eviction history, rental history, and to confirm employment and income. Managers are able to gather this information quickly and will review their findings with you, offer guidance from their experiences, and keep the process moving swiftly for your and the applicants anxiously awaiting a response.
In addition, they should provide a through lease specific to your state’s regulations and enforce it with the tenant. They will also hold the security deposit in a proper trust account, collect monthly rent, manage any repairs, and issue legal notices.
Managing a property yourself is an option that many choose, but know that these are all duties that you will be responsible for.
Get the Proper Landlord Insurance.
Landlord insurance [link to L&F Insurance] provides security for your rental property and helps ensure that you get a return on your investment. Different insurance companies offer different levels of coverage, so contact your current homeowner’s insurance agent and discuss plans to lease your property. Your agent will advise how to best cover your home with a landlord-specific policy. Make sure your landlord policy is in place when the lease term begins.
Prepare Your Home for Tenants.
Before your tenant moves in, your home should be cleaned, empty of all personal items, and free from any major repairs. Have all carpets professionally cleaned and be sure everything is up to code to the best of your knowledge. Install fresh batteries in all smoke detectors and confirm they have not expired. Change any burned out light bulbs and install a carbon monoxide detector on each level of the home.
Purchase extra air filters and leave them in the home for your tenants to have easy access to. Make sure neighbors have contact information for your property manager to alert anything they find alarming or outside community regulations.
Enroll your tenant in community updates, via mail and email. Leave instruction manuals for appliances and make sure the main water shutoff and electrical panel are easily accessible. Write down old alarm codes used in case of security system malfunction and provide garage keypad codes – anything helpful for the tenant to avoid future maintenance reports.
Be Accessible to Make Repairs Promptly.
If you have a property management company, they will handle communications with the tenants and coordinated any requested repairs. However, make sure you are accessible and stay in touch with your property manager so you can review repair estimates and give approval as to how you would like to proceed.
If you are not available, make sure your property manager has the ability to make decision on your behalf. Make a list of your trusted service providers who are already familiar with your home, such as appliance repair, HVAC maintenance, electrician, etc.
Renting your home as an investment can be beneficial, but be sure to weight the financial and personal factors. Sometimes it may be worth paying a highly monthly mortgage than the monthly rent you receive if you will be able to sell the property in the future at a higher price. Landlords across the Triangle are renting their homes to great family’s every day! Will you join them?
Interested in renting your home?
About Kristina Ellis-Godoy.
Kristina Ellis-Godoy is a full-time sales associate of the Fonville Morisey Realty Brier Creek office.
Kristina is a member of the Raleigh Association of REALTORS®, the North Carolina Association of REALTORS®, and the National Association of REALTORS®.
Fonville Morisey Realty has 11 sales offices, with over 850 associates and employees throughout the Greater Triangle region. FM offers mortgage, insurance, property management, title services, real estate education courses and relocation services through its divisions and partners. For more information about Fonville Morisey Realty, visit www.fmrealty.com.