First Time Landlords-You Can Do It Too

by Mario Acosta on February 4, 2013

in Buyers, Investors

Last week I began talking about the possibilities of renting out your current property to enable you to step into a different one yourself. If the idea pencils out on paper there is a good chance it could be a great stepping stone in your financial future – or a way to sit on a property while the property values climb back up to a place where it’s worthwhile to sell it. So as promised, here is the first of a few blogs where I will provide tips on becoming a first time landlord.  If you have a trusted realtor, talk to them.  They will have experience and insight, and will be happy to assist you in getting started.

Step 1: Get The Property Ready To Rent

I am sure at one time or another we have all rented an apartment or a home. So you know what the experience is like and what you hoped to find when you walked through the door. Obviously there are local codes for health and safety that you will want to be in compliance with, but beyond that you want to make the home feel ready to move into. Fresh paint and clean throughout – and if you don’t replace the carpet have it professionally cleaned. Allow it to dry completely before you show the property. Lawns and landscaping should be well tended. I always pressure wash the exterior and under the eaves. Clean the gutters and brush out any cobwebs in storage areas and around water heaters. I also bug bomb the property while it’s vacant. Make sure everything works. All the lights and bulbs are functioning, cupboards open and close properly, doors & drawers don’t stick, hinges oiled, toilets clean and fully functional. After all, this is how you would like to receive the property upon move out, and if necessary, to use the security deposit to make it so. Have blinds open, and I use plug in air fresheners here and there. Nothing strong – just a nice clean smell. I also like to warm the place up or cool it down before I show it.

Step 2: Market Your Rental Property and Find Your New Tenants

When you are ready to start interviewing applicants, the most simple and effective way to attract tenants is with drive-by signs advertising that your property is up for rent. In fact, a recent study conducted in U.S.A and Canada shows that almost half of tenants are found using this method. On top of that, drive-by signs are almost free and do not require much effort as well. If you are learning how to become a landlord, this is one thing you can’t afford to ignore. Local area newspaper advertisements and word of mouth recommendations by friends of tenants are close runners up, when it comes to attracting tenants to your property. If you are using the newspaper advertisements, it is often a good idea to include your address as many serious tenants prefer to drive by the property before even contacting the landlord. If your ad fails to attract enough tenants or you are looking to rent your property quick, you can also include your asking rent price in your newspaper ad.

Step 3: Screen Potential Tenants and Choose Someone Reliable

Now that you have potential renters ringing you up and knocking on your door, you have to pick the right one for your property. If you are learning how to become a landlord, this is a crucial step to master, if you want to avoid a sea of headache later on. Therefore, it’s a must to interview any potential tenant face to face before you rent out your property. There are two crucial things to consider when choosing your tenant, his ability and willingness to pay the rent on time, and if he will play nice according to the terms of the lease. While it can be a challenge to judge how responsible someone is during a short interview (especially if you are still learning how to be a landlord), it will be easier for you to verify his income and workplace. In most cases, a tenant with a secure job and regular salary is preferred over renters with irregular income sources such as a rookie salesman who earns commissions for a living. If you want more reliable and complete information on your applicants, there is a quick and easy way to do it. You can actually buy credit reports, eviction records and background checks of your potential tenants from well-trusted tenant screening sites such as Tenant Verification Service or E-Renter.

Step 4: Inspect The Property With Your Tenant Before He Moves In

Once you have selected your ideal tenant, it’s always a good idea to give him a welcome session where you inspect the property together. During the inspection, you should give a simple demonstration of how the security, heating and air systems work. Also, water, gas and power shut offs and any safety features of the home. Lastly, inform him how the garbage collection and newspaper delivery works in the area. With today’s cell phones all having cameras, it’s almost unthinkable to not document the condition of the property with the new tenant. Although not necessary, it will be helpful if you can show him the location of neighborhood conveniences like the nearest 24/7 store, petrol station or shopping mall.

After inspecting the property, remember to have your tenant complete and sign a move in check list – This signed check list is the whole point of the inspection in the first place. If you are learning how to become a landlord, you may find it bothersome to inspect the property, but it will come in handy in protecting you against unreasonable repair demands from your tenants later on. It also makes deducting money from your tenant’s security deposit for repairs a breeze. Becoming a landlord means having to deal with any property repairs and maintenance to make sure that your rental property is in a inhabitable condition according to your area’s health and safety codes. You need to ensure that your property is well maintained because most major repairs can be very costly. The best way to lower your expenses is to fix any damages while it is still superficial. When you are hiring contractors to carry out repairs on your rental property, there are a few things you have to know as first time landlords. You can ask your neighbors, friends and the local landlord association to recommend to you contractors who have provided excellent service. Most countries issue licenses for contractors but contractors do not always have to be licensed to carry out repair work. If you are learning how to become a landlord, you should also insist on hiring a licensed contractor to ensure that the guy who is replacing your water pipes or roofing has at least undergone a basic level of professional training. It’s a good idea to ask for price quotes from at least 3 contractors so that you can compare and bargain. The prices quotes also have to contain details of the exact repair work so that you will know what exactly you are paying for.

Well I am trying to keep these blogs to a readable length and not overwhelm you all at once, so I am going to end here for this week. Next week I will talk about keeping track of your costs, and handling problems, as well as the big mistakes first timers make so you can avoid them.

Have a great week – be well.

Sherman Oaks Home Search Sherman Oaks Home Values

Post by Mario Acosta

Mario has written 117 articles.

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