Renting out your home rather than selling it can be a lucrative investment if done right. If you’re moving across the country and not ready to sell your home or have the funds to buy a new home without selling, this may be your best bet.
Statistics show that 70% of Americans live in single-family homes, so there is a big market for home rentals. You can also consider refinancing your loan with the help of Ideal Lending before you move and take advantage of lower interest rates. Here are some tips on converting your home into a rental property.
Prepare the Home
Like in an apartment building, you’ll want to prepare your home for tenants by painting, making necessary repairs, and clearing out all belongings. If you’re a first-time landlord, you may want to hire a property manager to handle your management. A property manager can hire the rental process from start to finish in exchange for a fee. This includes taking photos, preparing the home, finding tenants, and handling applications.
Once your home is rented out, they will also manage any handymen and needed repairs. This makes having a rental property very hands-off for you. While you will be sacrificing some profit, it can save you a lot of work, especially if you don’t have contacts for all of the above tasks on hand.
Market Your Property
Once the house is ready to be listed, it’s time to reach out to potential renters. Lots of sites like Zillow and Redfin list homes for sale and rent. Some of these sites also offer screening to keep all necessary info in one place. This is where flattering photos and a great description can help your house stand out. List all features of the property as well as any neighborhood benefits that tenants might want to know. You can put the date the property is available and whether the property includes any utilities. By putting all financial information, you will also be weeding out those who are not a good financial fit.
Traditional methods are still great, as well. You can create business cards and leave a lasting impression on potential tenants. This personal touch can set you apart from other landlords and let renters know you care about them and the home. It is simple to design a personalized business card online using pre-made templates and adding your own colors, font, and photos.
Find Good Tenants
Whether you use a property manager or not, you want to vet your tenants to ensure they are the right fit. Decide if you’re ok accepting pets, and if so, how much you want to charge for a pet fee to handle some of the inevitable damage. The first step is putting together a thorough rental application. You can ask for rental history, employment history, references, and other essential information. You can also let renters know your requirements, such as minimum credit scores and income. Remember to be clear on whether or not you allow smoking on the property and follow the rules of the Fair Housing Act to avoid discrimination.
By following some of the tips above, you will be on your way to renting out your home and turning a profit. While your home continues to appreciate, you can contribute the extra cash to another mortgage or rental if you’re in between homes.
