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Your house, your rental income and your future.
In the age of Airbnb, listing your home, property or apartment for temporary and long-term renting is a unique way to generate income while stepping into property management shoes. Listing your property, which may initially sound simple, requires meticulous management, organization skills and a general understanding of landlord-tenant law. The worthy feat of generating income through property rental is gaining popularity, particularly in areas where housing is in high demand.
Explore the comprehensive guide below to understand the process of renting your house and assist in developing an efficient property management strategy. These step-by-step instructions are tailored to assist both novice and seasoned property owners in maximizing the benefits of the significant endeavor that is the rental game.
Renting out your house: a step-by-step guide
Follow these steps to ensure you and your potential renters gain the most from the renting experience. In addition to optimizing your earnings, acquire the know-how to increase your visibility, ensure compliance with legal regulations and cultivate essential management abilities.
1. Understand local laws and regulations
Before you embark on your property management journey, it’s imperative to research and familiarize yourself with local laws and regulations around renting. Here are some rules, regulations and definitions to understand concerning renting out your house while playing by the rules.
Fair Housing Act: This federal law prohibits discrimination against housing applicants on the basis of race, color, religion, national origin, disability, sex, age or familial status (e.g., women who are pregnant, families with small children or teenagers, etc.).
Fair Credit Reporting Act (FCRA): Credit and criminal background checks are subject to federal regulation known as the Fair Credit Reporting Act (FCRA). Its many provisions include the following requirements:
- You must notify applicants in writing and get their written permission before running any check on them.
- If you decide to reject an applicant based on the findings of a credit report or background check, you must notify the applicant of your intent in writing, furnish them a copy of the report and give them a reasonable amount of time (a week suffices) to respond with a correction or explanation of the report’s findings.
- After that period, upon consideration of any response you get from the applicant, you may notify them in writing of your final decision.
“Fair chance” laws: This isn’t a federal law, but a growing number of states and cities have enacted these measures to prevent discrimination against persons with prison records. Specifics vary by jurisdiction, but most of these laws forbid asking about past criminal convictions or incarceration on housing applications.
Protect yourself by consulting your legal advisor to see whether any fair chance laws apply to you, and how they might affect your tenant-screening process. Avoid exposing yourself to legal liability as well by utilizing professional background-check companies or consulting legal advice further.
2. Prepare your property
Staging your property and making it suitable for renters is the next step. Ensure any broken appliances are fixed, messes tended to and any recommended enhancements are made. Completing some market research to see similar rental properties to yours (properties that have similar offerings like bedroom and bathroom numbers or properties in the same location) can be helpful in terms of improvements or enhancements to make to your rental property.
Secure landlord insurance as a part of your preparation step. Landlord insurance is a specialized policy that safeguards property owners from potential financial losses and liabilities when renting out their residential properties to tenants. It typically covers property damage, liability protection and loss of rental income due to covered events.
3. Set a competitive rental price with our rent estimator tool
Continue your market research in this step to determine the ideal price range for renting out your property to temporary tenants. Utilize this rent estimator tool to assist you in valuing your property for rent price.
4. Draw up a lease agreement
Draft a comprehensive lease agreement that clearly outlines the terms and conditions of the rental, including rent amount, security deposit, lease duration and any rules or policies for the property. Ensure that it complies with local and state laws.
5. Create your listing
Once you know what you’re charging for rent, you’re ready to get to the heart of marketing the property online: putting together a listing that will entice tenants into renting out your home.
The key to a great listing is communicating the unique advantages of your property in a way that attracts the right kind of tenant. Namely, a tenant who will be dependable and take care of your property as if it were their own.
A Rent. survey found that most seekers of single-family rental (SFR) properties are married or in domestic partnerships (62 percent), have children (61 percent) and have pets (54 percent).
Regardless of who you are renting out your home to, it’s important to highlight what’s most likely to resonate with your ideal tenant. Here are some potential features to consider when renting out your home.
- Schools: Each Rent. listing automatically displays GreatSchools.org ratings for schools closest to each property. If nearby schools get high marks, consider highlighting them in your property description and noting if any are within walking distance.
- Parks or playgrounds: If there are parks or playgrounds nearby, mention them and how long it takes to walk or bike to them. If you pique any rental seekers’ curiosity, they can use the map embedded in the Rent.com listing to explore via Google Street View.
- Pet-friendliness: If you plan to allow pets on the property, make sure you include this in the listing, along with any breed restrictions info. Call out relevant details that will be of interest to pet owners (e.g., nearby pet-friendly parks, fenced-in yards, doggy doors, etc.).
- Neighborhood highlights: Call out nearby landmarks, much-loved hangouts or transportation conveniences like a train or subway stop and include a picture. Don’t forget to call out the distance from your property.
6. Market your property
Share your listing across ILS networks to cover a lot of the heavy lifting, but you can also share links to your Facebook and Instagram accounts. Try using Facebook Marketplace to limit the post geographically (and to reach potential tenants you aren’t friends with on Facebook).
Once you’ve posted one and shared it across multiple ILS sites and social media, you’ll likely be moving on to the next phase of the rental process: choosing the best tenant from among the applicants who are interested in your rental listing.
7. Screen and collect
Develop a tenant screening process that includes background checks, credit checks and references. This will help you select reliable tenants who are more likely to pay rent on time and take care of your property. Once you find a suitable tenant, collect a security deposit and the first month’s rent from your tenants before they move in. Make sure you follow local laws regarding the handling of security deposits.
Once tenants are inhabiting your rental property, it’s imperative to stay responsive to maintenance requests from your tenants. Timely repairs and maintenance will help keep your property in good condition and your tenants satisfied.
8. Maintain your rental property
Regular maintenance tasks include keeping the property in good repair, addressing maintenance requests promptly and conducting routine inspections to identify and address issues before they become major problems. Timely maintenance is important because it minimizes the risk of costly repairs down the road. Make sure to stay up to date with local regulations and safety standards as well to ensure that your rental property remains compliant and safe for renting out.
Renting our your house made easy
Renting out your home, in the age of Airbnb and VRBO, is an exciting time and journey to embark on. Once you estimate your home using our rent calculator tool, draw up your lease and prepare your property, the rest of the process involves meeting and vetting potential tenants. Sharing your home, community and amenities is a unique job that just about anyone can do, using this article.
The information contained in this article is for educational purposes only and does not, and is not intended to, constitute legal or financial advice. Readers are encouraged to seek professional legal or financial advice as they may deem it necessary.
Source: rent.com