The Advantages
Passive Income
August 26, 2021
There are numerous advantages to becoming a landlord. You can earn passive income and perhaps build riches for retirement. However, when you're just starting out, there are certain challenges you need to look out for. So, if you're a first-time landlord, or you're thinking of becoming one, this article is for you. We will help you with the necessary landlord chores, from preparing your property, finding and screening tenants, to collecting rent on time.
Set The Right Price
As a first-time landlord, you must set the right price for your property. To determine the appropriate rent, you should conduct some market research. Determine what the fair market rent price is in your area. Pricing your rental at a reasonable fee can help you rent your property more quickly. It's what makes the difference between your property sitting vacant and finding tenants fast. When setting the price, don't forget to consider things like the size of the accommodation, it’s location and competing properties in the area.
Prepare Your Property For Renting
Before renting:
Think of your target audience
Decide on the type of tenant you want to attract
Do what you can to make your property appealing to them
For example, if you're a first-time landlord looking to rent an apartment to students, make sure they have desks for studying. Similarly, families with children would enjoy big kitchens with large dining tables.
Furthermore, make sure your property is in good condition and structurally solid before putting it on the market. De-clutter and keep it tidy as much as possible while it's being marketed. Make minor fixes and remodeling if needed. One of the minor upgrades to make your property look more appealing is turning the balcony into a tiny garden. It will create an oasis where your future tenants can relax.
Find Tenants
Because most tenants look for their next apartment online, creating an online rental listing is the most effective way to find tenants. As a first-time landlord, you should make an internet rental listing that informs tenants of everything they need to know about your rental property. This means you need to include information like address, the rent price, number of bedrooms and bathrooms, and other amenities. It's best to upload high-quality photos of each room and shared spaces, so future tenants can better visualize the space.
Keep in mind that Renting Toronto takes care of every step mentioned in this article to make your Landlord experience a great one.
Require A Rental Application
When looking for new tenants, request they fill out a rental application. Find out which questions landlords most often ask their potential renters, and run with them. If done right, the rental application will provide you with the necessary information about your prospective tenant. This includes their name, present address and their reason for moving, employer details, income, and landlord references. It is critical to ask the correct questions to have all of the information you need to decide who will live on your property.
Create Your Tenant Screening Process
The primary purpose of tenant screening is to help you find quality tenants who will pay their rent on time and take care of your property as if it were their own. It is critical to weed out decent potential tenants from the mountain of applications you may receive. Your perfect tenant should be able to pay in full each month. Furthermore, they should have no criminal record and have a solid renting history.
Require Tenants Insurance
Many people are unsure if renter's insurance is really worth it. However, as a first-time landlord, you have nothing to lose by requiring your tenants to get this kind of insurance. On the other hand, you can avoid litigation if the renter's possessions are harmed or damaged. This can be avoided by mandating renters/liability insurance. Furthermore, renters insurance is often inexpensive and won't present a financial burden to your tenants.
Create A Written Legal Agreement
A formal rental agreement is the best approach to explain your expectations and protect yourself in the event of a legal dispute. While verbal contracts are permissible in some cases, they are less effective than a written contract signed by both parties. It may be difficult to verify what was agreed upon before the tenant moved in without a written record. Make sure your rental agreement is specific enough and that it covers most of the questions and concerns your tenants may have while they stay on your property.
Help Your Tenants Move In
Once you've found the right tenants and signed the paperwork, it's time to arrange a move-in date. Before moving day, make sure everything is ready for your new tenants. Clean your property, change the locks, and get an extra set of keys. Test lights, locks, appliances, and smoke detectors to make sure everything works. Find out if they're using any kind of moving services to help them pack or move. Be familiar with all options so you can do your best to welcome them into their new home.
Keep Records Of Everything
You should keep records of all interactions with your tenants. This includes deposit receipts, rent receipts, maintenance receipts, or any other landlord-tenant interactions. Digital documents may be safely organized without the need for paper. Keeping receipts and correspondence records is a good practice in case of legal difficulties. If you keep records of transactions and communications, you will establish your case in court more easily. You will have all the evidence to back up your statements.
Collect Rental Payments Online
If you're a first-time landlord, consider setting up scheduled monthly online payments from your tenants. Rent payments made online are more convenient and practical. Furthermore, it can be risky for tenants to mail cheques. Their cheque can be lost, or worse, their bank account information may get into the wrong hands. In online transactions, personal information is encrypted. Unlike a cheque, online payment is unlikely to be lost in translation.
Consider Hiring A Property Manager Or A Rental Agent
If you're looking to save time, hiring a property manager or Rental Agent can be a worthwhile investment. As a first-time landlord, you may not be ready for all the obligations that come with the job. By hiring a property manager, you won't have to bother with things like marketing, collecting rent, or dealing with issues your tenants have.