So you are considering converting your home into a rental property, but just making your home available for rent is not enough. Here are some important things to consider before turning your home into a rental:
1. Rental Market Price
Although the rental market prices can fluctuate, you need to know how to price your property. There are several ways to know the best market price for your home. Firstly, you may want to contact real estate agencies. With reputable real estate agents, market prices will depend on their database and experience in the industry. Secondly, you can go online and find out how much your unit could fetch from related properties listed by owners or agents. Finally, you may decide to drive around your area and gather as much information as possible. It could be a bit off target, but can help you come up with a reasonable market price.
Even if you don’t want to manage your unit on your own, it is always important to establish contact with renters. So you want to leave them your contact details just in case they need to call you. Obviously, you will want to put some rules in place to ensure your property manager is informed whenever issues arise. If you are not ready or able to commit time to meet the needs of your tenants, then renting out your property may not be a good decision for you.
While homeowners enjoy the flexibility and freedom of making any sort of repairs in their properties, such leeway is not given to tenants. You cannot postpone maintenance and repairs while you save money to attend to them. Moreover, if you need to fix minor issues, you may have to hire a handyman, but collecting rent to attend to such issues will end up reducing your profits, thereby making it harder to pay your bills. Before turning your home into a rental property, determine the potential maintenance costs and use such details to decide if renting out your home makes financial sense.
Many experienced tenants have a horror story about tenants from hell. When pondering whether or not to turn your home into a rental property, consider who your potential tenants will be and whether your neighborhood will supply the required number of tenants that you need to pay your bills without putting your finances at risk. Of course, you don’t want renters who cannot pay rent on time or those who do not respect their neighbors or other people. It is important to take the time to research your prospective pool of tenants before renting out your residence.
These days, many landlords are seeking the services of real estate agents and property managers who can help do the research as regards finding renters and maintaining their property. Find out the cost of such services to determine whether you can afford their help to ensure renting your house makes financial sense.
Turning a home into a residential or commercial rental property can be a great way to earn some extra income. However, homeowners should consider the aforementioned factors before opening their doors to renters. With proper research and sound financial management, putting your home up for rent might be the right decision for you!