There are many things to consider and many more preparations to make before launching your own property rental business. Below is a checklist to help ensure a smooth and profitable outcome for your business.
follow the law of the land– Find out what laws govern rentals of your type in your area, follow agreements, conditions and restrictions. Carefully read all documents that establish the rules for the area where your home is located and sign any necessary contracts/agreements BEFORE entering into a contract with your tenants.
License and Permits – make sure you have completed all the necessary paperwork and have all the licenses and permits required to rent your house in the area where you are located.
safety regulations – each state or province has its own security specifications. Be sure to follow the rules set forth for your home as a rental.
Sure – insure your home, buy contents insurance as well as renters/renters insurance. It is always better to pay a little more each year than to find yourself at the mercy of fate when it strikes.
Advertising – you will find a very detailed advertising strategy for your rental house later in this book, however, these are just some of the highlights:
TO. Do your research and decide what your best advertising options would be.
b. Sign up to some of the most popular online rental websites where you could advertise your property.
against Have a redacted copy, which you could offer to other websites, and circulate both in the physical world and in the virtual world.
d. Take photos of your property in the morning, at noon and at night to make an impressive portfolio; Have a virtual home tour ready when you need it.
my. Create a website, if possible, and list your property there; it will be very easy to provide the link to your prospective tenants via email or other means.
F. Tell your friends, colleagues and family about your property. It will make a great word of mouth advertisement.
Leasing contract – It is necessary to have a standardized rental contract. Check with your local real estate board, they often have a very complete residential lease available for a small fee or even free.
Taxes – understand the tax obligations and benefits in your state or province. Pay close attention to capital gains eligibility and tax deductions.
Payments – Income and expenses need to be clearly understood so that you know where you are financially at any given time. Here are some steps to help you in that direction:
TO. Calculate your break-even point.
b. Set up a rate chart that covers your daily, weekly, monthly, or yearly rates.
against Create a system by which you can understand your cash flow, expenses, and net income.
d. Have an elaborate payment schedule.
my. Have standard forms and letters ready to facilitate communication.
Maintenance – Maintaining your home is an important activity that requires your attention. Unless the house is well maintained and cared for, your guests will not be able to settle comfortably in your house. Here are some important points to remember:
TO. Provide clear instructions on garbage disposal.
b. Provide a phone number for emergency contacts.
against Provide clear instructions with a chart if possible, on what maintenance you expect your tenants to do and what you will do. See the Lease Addendum – Policies for a sample repair addendum on the ‘Property Management Forms and Letters’ disk.
d. Make sure all repairs and renovations are completed before guests arrive.
my. Arrange for a reliable cleaning service or housekeeper (for vacationers; for non-vacationer rentals, cleaning would be the responsibility of the tenant)
General: This covers a few things that would facilitate a comfortable stay for your tenant:
TO. Provide informative documentation on the attractions of the area.
b. Please provide a list of your recommendations for dining out, shopping and entertainment. This would be exceptionally well received by your tenants.
against Please provide a tourist map of the city, a public transport map if you have one, and some numbers of taxi companies.
d. Provide an up-to-date yellow page book.
Owner- effective communication is very important both before and after you find the right tenant for your home. Here are some points of guidance:
TO. Please take your time to prepare standard answers to the most common questions you will receive.
b. Establish standard procedures, so that both you and your tenant know how to proceed in certain situations and have the same expectations. An example of such a procedure would be an entry and exit procedure/policy.