When it comes to renting out a property it can be profitable or cause a homeowner to incur serious losses. Thankfully, there are ways to ensure that renting out a property will not be a complete disaster. As everyone knows, some renters can wreak absolute havoc on the property that they inhabit. Most of these troublesome renters will put up red flags during the rental application process. Knowing what these red flags are can help any property owner screen out people that are not a good match for short or long-term rental contracts.
The Top 5 Things to Focus on Before Renting Out a Property
Thoroughly Screen Prospective Tenants – Before a property is rented out to a tenant a comprehensive criminal background and employment record check should be conducted. It is not uncommon for prospective tenants to lie about their employment status when attempting to secure a rental. Be sure that the tenant is actually employed and that they do not have an extensive criminal background.
Have a Backup Plan For Problems – Anyone that rents out a property should have adequate fail-safes in place, especially if a long-term rental contract comes into play. Always be sure to have an affordable strategy in place to cover water pipes failing, electrical lines going offline, or any other systems failures within the property that will be rented out.
Know Eviction Rights – Every person that rents out a property should be well versed in their right to evict a troublesome tenant. Some recent studies have indicated that at least 10 percent of tenants need to be evicted before they will leave a rented property. Knowing the proper eviction protocol can fast track the entire process.
Charge Realistic Rates – Experienced and successful renters know that charging a realistic or slightly low rent rate is a far better long term strategy than trying to squeeze every penny out of a maximized rate. If a tenant is paying a reasonable rent rate they are more likely to pay on time, treat the property with care, and do everything necessary to stay on good terms with the property owner.
Use Rental Insurance – Smart property owners that rent out their buildings know that forcing a tenant to come equipped with rental insurance is one of the most important things they can do. Rental insurance will ensure that any problems caused by the tenant will be adequately covered by their own rental insurance plan.