The real estate market has seen significant changes in the past few years. Rising home prices have priced many people out of home ownership. With more people looking to rent properties, a homeowner can easily become a first-time landlord.
When you first start out, being a landlord can be difficult. You'll need to know everything from screening tenants, writing a rental agreement, and online rent collection.
There's always the option of hiring a property management firm. However, you will still need to know the ends and outs.
Here are five essential tips every first-time landlord should know.
1. A First-Time Landlord Needs to Know Rental Laws
Being a landlord places you in the role of a business owner. You must adhere to federal, state, and local laws in order to conduct ethical business. In order to safeguard your company's reputation and avoid potential legal issues, it's vital to comply with all applicable laws.
Before diving headfirst into real estate and rental property investments, be sure to thoroughly research all applicable laws. Speak with a real estate attorney to ensure you have a clear understanding of your legal responsibility.
2. Rental Rate and Fees
To set the right lease cost, research your local market to determine what the fair lease cost is for your property. When calculating your rental price, also consider your profit margin. Key things to consider are your mortgage, state and federal tax responsibilities, insurance, and property maintenance costs.
Rentals are also a source of income, so factor in a profit margin. It's easier to see how rent prices affect your monthly revenue if you compare income to expenses.
Utilize an online payment portal to streamline the rent payment process.
3. Tenant Screening
The primary objective of tenant screening is to assist in finding dependable tenants. You want renters who will maintain your property as if it were their own and pay their rent on time.
You also want tenants who have:
- verified income
- good rental history
- good credit and background
It is essential to conduct a thorough tenant screening prior to the renter's move-in. Maintain a professional relationship with your tenants at all times.
4. Rental Application
Today's technology makes it easier to accept rental applications online. You also have a means of digital recordkeeping.
Rental applications and agreements are the best way to communicate your expectations. They also safeguard you in legal situations where it may be challenging to demonstrate what was agreed upon prior to the tenant moving in.
5. Tenant Management
A new landlord could use a little help. That's where a property management firm can come into play. Use the services for the things you can't handle.
You can hire someone for property maintenance, tenant screening, or handling evictions. If you begin to take on more properties, the firm can manage all of your real estate properties.
Give Us a Call!
Renter's Warehouse offers various services to assist a first-time landlord in Virginia's Hampton Roads area. Services include free rental analysis, landlord education, and much more.
Contact us for more information on our full line of landlord services.