6 Tips for First-Time Landlords Getting Ready to Accept Tenants
Owning a rental property and getting it ready to bring in the first tenants is exciting, but it can also be nerve-racking. For first-time landlords, there’s a good degree of nervousness about what they should be doing and what to expect from the experience. They’ve all heard about difficult tenants and the need to avoid them where possible, but there are other considerations too. However, managing a rental property well helps to realize positive cashflow with price appreciation as the cherry on the top for real estate investors.
Here are six tips for the first-time landlord when moving towards accepting tenants.
Tenant screening is everything when you are a landlord. You have to know who you are letting stay in the property. That’s difficult to do when you haven’t met the person or couple before. How you get around this reality is with proper screening of prospective tenants.
A background check and a credit check help to remove applicants who should be ruled out right away. With a background check, it can confirm if they’ve had a history of trouble with the law or other problems. A credit check confirms their credit score and any issues with debt or late payments. If a past landlord has registered a debt, then it will show up there. An outstanding lien will also show up.
Also, look at their employment history. If they tend to hop from job to job, then it could be an issue for reliable rent payments in the future when between jobs. However, if they have been with a single employer for a while or have a history of regular jobs where they’ve found a new one before leaving the current one, then that looks perfectly normal.
You should also verify county occupation rules based on the size of the property. Have prospective tenants complete an application form. Contact past landlords to see what they have to say about the person because stories can differ dramatically from what the prospective tenant says.
2.Get a Better Match Between the Property and the Tenants
Finding the right type of tenant for an apartment isn’t always easy if it’s not in the perfect spot for commuting or accessing local neighborhood shopping centers. Sometimes, you might discover that getting the perfect (or near perfect) tenant is a tough ask because the area doesn’t support that.
Try using an apartment guide to narrow down the search and make matching an apartment to a renter a smoother process. The Apartment Guide rental resource is designed to match property owners with tenants through their mobile apps. The apps run on Android or the iOS operating system (iPhone and iPad).
The apps include a reputation monitor making it simpler for landlords to get a better sense of the quality of each applicant. Listing a property by posting it on social media is possible through the app too. The system is run by RentPath which also owns Rent.com, Rental.com and LiveLovely.com, so you know you’re in reliable hands.
3.Real-Life Staging with Furnishings
When listing a property for sale, staging it by removing existing furniture and replacing it with brand new, fashionable furnishing is a great way to help potential buyers envision themselves in the house or apartment. The same goes for renting a place too.
As a landlord, you could rent a property unfurnished. It is a smart idea to examine the local market to see how other landlords list properties. If they tend to all offer places to rent that are unfurnished, then there might not be a market for furnished rentals locally. Alternatively, it might be that people are looking for furnished places and struggle to locate them.
Turn to Google to check what renters are commenting on social media and posting on forums in the local market to gauge interest level. Then provide the property in a furnished/unfurnished state that suits what renters are looking for.
4.Know Local and Federal Housing Laws
Understanding Fair Housing Rules and Regulations is necessary for new landlords. These govern the position from a federal standpoint and there are local laws to be aware of too. The laws are there to protect people who fall under certain classes against discrimination relating to housing specifically.
The laws and rules can apply nationally but there are also those that are specific to the state or the city/town where the property is located. One area that is a frequent issue relates to not permitting an animal which aids its owner, such in the case of a blind person. Laws stipulate their right to housing with their support animal regardless of the wishes of the landlord who may not like pets in general.
Familiarize yourself with the local and federal laws relating to renting out properties or consult with a lawyer that specializes in the laws surrounding rental properties. Be aware that should a lease be drafted in a way that contravenes the law, it can be invalidated in the courts along with fines applied.
5.Cleaning Up Before Renting
Perhaps you purchased the property to rent it out? Or, is it a former home that you’re turning into a rental and you’ve bought a new home? If the property was your former home, be sure to remove anything personal to create a blank slate. If people have to remove knickknacks from the cabinets to make space for their own trinkets, they won’t know where to store them. Declutter to clear away unwanted items before taking pictures of the interior.
The property must be cleaned top to bottom. It should be immaculate before inviting prospective tenants in to see the place or taking photos to be placed online. While you may overlook a dusty upper shelf or a chipped kitchen worktop, you can bet your last dollar that visitors looking over the place will notice it all. People will begin to question the rental cost when the rental property isn’t immaculate; that’s just the way it is. Get a professional team in to clean the place.
Don’t forget about the front and rear yards too. Curb appeal is important when first driving up to the property. What are the first and second things that a potential renter will see? Similarly, how does the rear garden area appear? Are there raised patio steps that could be hazardous and need fixing? Ensure the front and rear lawns are mowed and trimmed up properly to be presentable too. People notice the little things.
6.Streamline Rent Collection
Create a system where you can collect rent payments online via an app or automatic payments. This cuts out the need to go door-to-door yourself. When doing it the old-fashioned way, it’ll often take several trips to collect the rent when owning a few apartments and not a single-family home. Save yourself the hassle and get automated.
Renting a house or an apartment the first time seems quite daunting. There is certainly a reasonable amount to learn, but once you’re up to speed on the fine print, it’s full speed ahead. Renting out properties has been found to be a reliable source of income that doesn’t stop just because the stock market fell 20 percent. It’s got excellent diversification benefits for investors and has historically performed well over the decades too.