If you’re a first-time landlord, chances are that you’re not aware of a lot of things. Since you’re dealing with real estate, you can’t adopt the attitude that you’ll take it as it goes and go on a learning curve. Several rigid laws govern accommodation and tenancy policies. Insufficient or improper laws can open you up to several lawsuits and complaints that could end up being costly for you, especially when renting out a house for the first time
Once you’re familiar with all the relevant laws, you need to understand where and how to apply. Because being a landlord isn’t the same as being a good landlord. Being a good landlord is more than complying with all the provisions and drafting tight contracts. At the same time, it is also not about giving in to your tenants’ needs and being at their beck and call. A good landlord must know how to balance both so that he can effectively run his business because your property is nothing short of a business venture.
So, here are some tips for renting out a house if you’re a new landlord
Identify Who You Want to Rent to
Whether you like it, a locality will inevitably gain a reputation to cater to one type of tenants. If you have a property in that location and want to offer your property to a different niche of tenants, you will find a hard time renting it out to tenants. The fact that your property is in a neighborhood means that you’ve researched where to purchase your real estate.
But after purchasing the estate, the next step is to identify whom to rent it out to — identifying your tenants. You need to understand what sort of tenants your locality attracts and whether you can play with that niche or not. You need research for identifying who the property is meant for and whether the locality is fit for such tenants. If you’re unsure, there are several websites like Right Move that suggest what localities are best for which tenants.
With our bundle of Rental Lease Agreement templates, you can get reassured that your property is secured by legally-binding and enforceable contracts.
Advertise to the Right Tenants
Once you’ve identified who your ideal tenants are, you should look for avenues to advertise. If you’re catering to students, you should advertise your property on websites that offer sharing living, dorms, or university housing societies so that they can add your property to the list of recommended living for students. If you want to rent it out to families, then you’d be better off post options with realtors or websites that offer online consultations. Students’ requirements and family’s requirements differ by a huge margin. How and where you advertise is also important to attract the right tenants.
[ Suggested Read: Build to Suit Agreement]
Vet Your Tenants
This process of vetting should start from the moment they bid for the property. If your property is in a location that caters to the tenants’ needs, there is a good chance that you will attract a lot of tenants vying for the property. You need to find some way to screen all of them to settle on suitable tenants. One way to do that is by going for a sealed bid method. But you have the option to accept or reject a tenant. So, you should cash in this opportunity and vet your tenants.
After you’ve got the bids, it is against the law to reject the person you’ve selected if you find out something unfavorable about them later. You need to be sure that the tenants you’re accepting meet your standards of tenants you want.
That being said, you need to remember anti-discrimination laws. You can’t reject a tenant because of race, color, creed, or religious or sexual orientation.
Put Your Terms in Writing
Each tenancy is unique. Even though you might provide blanket tenancy terms, every good property comes with some changes that the tenants want you to provide. That is a reasonable request because the tenancy requirements for each tenant will depend on why a person is renting out your property. There’s a chance that the tenants might require some modifications that are not part of the original tenancy contract. If you agree to these terms, you need to put them in writing. Any terms that are not in the contract should be treated on an exception-basis. Even that should be mentioned in the contract. Your contract should contain a term stating that any requests will be dealt with on a case-to-case basis
Have Photographic Evidence and Conduct Inspections
Before tenants move in, insist that they conduct inspections of the property. This will absolve you of any liability if they find some problems with the property later. To further protect you, take photographs of how the property was before the tenant moves in. After this, send the photos to your tenant and take an acknowledgment.
This is important in case the tenant causes any damages to the property. In the same way, inspect the property after the tenant moves out and take photographs. Send the photographs to the incumbent tenant and take acknowledgment for the same. With these photographs and inspections, you’ll have authority for recovering damages from your tenant
There are so many mistakes that you can make as a first-time landlord. One of them is making incomprehensive and incomplete tenancy agreements. Agreements define the relationship between you and your tenant. Courts decide any dispute that may arise based on the agreement you have with your tenant. This does not mean that the agreement is superior to the state’s tenancy laws.