Find a new house before the old one sells out, or are forced to move temporarily for official business and want to get extra money to cover the mortgage? Want to try investing in property? Whatever the reason, you'll want to rent out a house quickly so that the income goes straight to your wallet. However, by putting a little effort into marketing your property and selecting tenants, as well as adhering to the rules regarding home rentals, you will save a lot of time, effort and money.
Step
Method 1 of 3: Determining the Rental Price
Step 1. Look for the comparison property
Of course, you want to rent out the house as quickly as possible at a high price. Comparing the house you are about to rent with other homes for rent in your area is the best way to determine rental prices.
- Look for homes to rent in your area through a real estate agent's website, or a site like OLX. Find homes that are similar in size, have the same number of bathrooms and bedrooms, are in similar condition, and are more or less the same age. You can also pretend to be a potential tenant and look around for comparable homes to compare them to yours.
- Check the site every few days for missing ads. The loss of the ad is a sign that the house has been successfully rented out. You can also contact the advertiser to ask if their home is still for rent. By asking, you will find out a reasonable rental price for your home.
Step 2. Repair your home before renting it out
Before renting out a house, you may feel the need to fix all the problems with the house. However, focus on repairs that will increase the rental price of the house.
- Make repairs so that your home complies with the IMB and other regulations so that you don't get into legal trouble in the future.
- If your home is IMB compliant, focus on making short-term repairs to increase rent, such as cleaning carpets, painting, or changing curtains. Long-term repairs such as roof replacements generally won't increase the rental price too much so you shouldn't have to do them unless there is damage to certain parts of the house.
Step 3. Consider the benefits you might get from renting a house
Before repairing or advertising a house, calculate the income you will get from the house, then compare it to the material expenses you have to spend. Also take into account the hassles you will face as a home owner.
- Once you know the average rental price for a house in your area, consider whether the rental price is worth the time and effort you put in.
- If this is your first time renting out a home, or you're having a hard time dealing with tenants, repairing your home, and collecting rent, consider paying a property manager. By paying half of the first month's rent and 10% of the following months' rent, the property manager will take care of everything about the property you are renting. The money you spend on a property manager may be nothing compared to the time and peace savings you get.
Method 2 of 3: Advertising the House
Step 1. Place ads in strategic places
How you advertise your rental home will depend on the location of the house. Although now many house rental ads are found on the internet, the sites used to advertise and other advertising media used can vary.
- If you don't subscribe to a local newspaper, buy it occasionally, and read the classifieds column. If you find a lot of ads for homes for rent, you may be able to advertise your home in the local paper.
- Advertise a home on a site that hosts many equal homes. Also use video and social networking sites to advertise. For example, shoot a video of a house tour, then upload it to YouTube and link the video in your ad.
- Research shows that ads posted on Fridays get more traffic than ads posted on other days, because potential tenants tend to search on weekends.
Step 2. Advertise in your home
Some people don't include addresses in their home ads, so they can tidy up their house first before showing it to potential tenants. However, there is nothing wrong with trying to attract the attention of road users who pass in front of your house.
- While you can put "For Rent" on your home page, an ad that looks professional, easy to read, and stands out will appeal to potential tenants more, especially if you're targeting a specific segment of tenants. Take the time to create an eye-catching ad, or ask a printing service to design an ad for your home. Include information about the property in your ad, such as the number of rooms and bathrooms and the features of the house.
- If your home has been vacated, consider opening windows and turning on the lights at night (especially in certain areas, such as the kitchen or living room) so potential tenants can see what's inside your home.
- Make an interesting event in your home, such as washing the warehouse. Also allow potential tenants to stop by and have a look inside the house.
Step 3. Find potential tenants creatively
While sometimes you just need to advertise and wait, generally you need to be more active in finding potential tenants so that your home sells faster.
- While you should be careful when renting out a house to family or close friends as your business relationship may be personal, you can ask them to share information about your home. In addition, distribute flyers about homes in places you frequent. Also use social networking sites, and ask friends and family to share your posts about home.
- If you need to find a tenant right away, or have been advertising without success for several months, you may need to offer additional incentives, in addition to lowering your rent. Offer a commission for people who refer potential tenants, lower the first month's rent, cover some of the electricity bill for a few months, or allow pets if you didn't previously allow them. Attract potential tenants, but be careful when selecting tenants.
Method 3 of 3: Choosing the Right Tenant
Step 1. Don't take the risk
It's best to leave the house vacant instead of renting it out to bad tenants, because bad tenants can cost you a lot of money and effort. Make your home attractive to good tenants, for example by lowering rents or repairing the house, instead of lowering tenant standards.
- Keep in mind that allowing someone else to occupy your home, especially if you are going to return to live in the house or sell it later, is a big decision that must be considered carefully.
- Before renting out a home, set up a rational, detailed, fair and legal tenant selection process to find the best tenants.
Step 2. Choose tenants carefully
Selecting a tenant just by asking a few questions is not wise, and can be disastrous. Use your instincts to "screen" tenants, but don't forget to check the validity of the information they provide.
- Make a form, and ask prospective tenants to fill in data such as name, date of birth, ID card number, contact information, address for the last five years, current and previous employment, emergency contact, and approval to contact the office/old house owner. After the potential tenant has filled out the form, ask him or her to sign it. You can download sample forms on the internet.
- Make sure prospective tenants fill out the form completely. If deemed necessary, ask the tenant to pay the application fee. Then, check the validity of the prospective tenant's income and employment data, and contact the owner of the house that the prospective tenant has rented.
- Do a background check on prospective tenants by paying a certain amount of money. Contact a specialized company to do a background check. In the US, you can contact Smartmove, which is operated by TransUnion and offers an easy background check process.
Step 3. Obey the applicable rules
Selecting prospective tenants selectively does not mean you can discriminate against certain potential tenants. Discrimination against prospective tenants is a violation of the law and can be reported to the authorities. You must also know and comply with all the rules regarding home rentals.
- In the US, you may not discriminate on the basis of ethnicity, color, gender, national origin, religion, or marital status of potential tenants. In fact, you are not encouraged to ask for this information.
- Make a copy of the tenant's application and rejection letter if any. Explain in detail why you are rejecting a particular tenant, for example because of income, behavior, etc.
- Prepare clear contracts for potential tenants. Make sure the contract complies with the rental rules in your area. Sample contracts are available on various sites, such as https://www.uslegalforms.com/ or
- Do a thorough inspection before giving out your house keys, and ask the tenant to fill out a form according to your local law. Take photos of the condition of the house before the tenants occupy it.
Tips
- You'll be fined if you violate housing laws when you rent out a home, even if you didn't do it on purpose. If you're not being assisted by a property company, look into the law by reading it online, and have a notary review your lease agreement to protect you from lawsuits.
- When repairing your home, prioritize construction, water, electrical, or door/window repairs. Then, do the painting, cleaning, and repair of the floor. If you paint the house first, other repairs can damage the paint, and if you repair the floor before making any other repairs, the floor may become dirty or scratched.
- US law requires you to explain in writing the reasons why you are rejecting a particular prospective tenant. For example, if you reject a potential tenant because of a low credit score, state the reason, then ask the prospective tenant to contact the credit reporting bureau for more information.
