If you are a military family and a homeowner, you probably understand the challenge of selling your home when you are deployed. Facing the choice of taking a loss on selling below value and renting out your home can make you become an accidental landlord.
Before you make any rental decisions, there are a few helpful things every new landlord should know. Some are easier said than done, but nonetheless important.
- Disengage your emotional ties to the home. Approach renting to strangers as if you were selling. If you’ve lived in your home a long while it’s not that easy to do, but important. Remember your tenant has a right to privacy.
- Screen your tenants first. Sadly, you cannot trust everyone so be prepared. Landlord Protection Agency (LPA) has a tenant screening worksheet to help with questions to ask. Look for signs of responsibility. Check references and compare what they tell you to what is on their credit report. A background check and credit report are mandatory. Know your tenants.
- Understand your state’s laws. Every state is different when it comes to how tenants are protected. Draft your lease or rental agreement to your state’s rules.
- Your rental price. The amount of rentyou charge your tenants should be a percentage of your home’s market value. Usually, the rents that landlords charge fall between 0.8% and 1.1% of the home’s value. And, be sure you collect enough deposit — no less than one month’s rent or possibly two — considered first and last months.
- Be a responsible landlord. As a landlord, you have obligations to make repairs and maintain the property to your city’s code. However, if the tenant just wants something upgraded, that is not a requirement you must meet. You might allow the tenant to do the upgrade if they want to pay for it. You might consider small deductions off rent for paying early and/or direct deposit. Both are a win-win.
Finding yourself in the role of accidental landlord can be a challenge on many levels. It’s good to know if you don’t have the time and/or resources to effectively manage the job, you can always rely on the property management professionals like Cousin James Management. Let us know how we can make your accidental landlord job a lot less stressful.