Are you exploring becoming a landlord? You’re not alone. Nearly half of all house rental properties in the United States are owned by individuals. And it’s no wonder why; investing in and managing a rental property can be a very wise choice. It can be a great way to generate income, pay off your mortgage, and more.
Landlording, however, is not an easy job. Good landlords manage round-the-clock hours, financial negotiations, legal contracts, and more. If you want to find success with rental management, there are 7 things to consider for first-time landlords.
1. You’ll Need to Understand Rental Law
Being a landlord doesn’t just involve owning property and collecting checks. Landlords must know the ins and outs of house rental law in order to maintain a property that is up to codes, regulations, and more.
2. Fair Housing Act
This law, born out of the Civil Rights movement, was drafted by the US Department of Housing and Urban Development. The Fair Housing Act legally protects citizens looking to rent or buy property or applying for loans or housing assistance from discrimination.
According to the Fair Housing Act, the following are just a few of the things a landlord cannot do based on race, origin, religion, sex, or disability:
- Refuse to rent or negotiate a cost
- Manipulate rental prices or rental process
- Evict a tenant or their guest
- Refuse to perform maintenance or repair
3. Legal Disclosure Rule
Was your house rental built prior to 1978? If so, the legal disclosure rule requires you to inform a tenant if the property will expose them to lead-based materials, including paint and other hazards.
4. Landlord-Tenant Rights
This is the umbrella under which all laws regarding the rights and responsibilities of the landlord and tenants fall. Each state has separate rules and regulations for both the landlord and the tenant, and you should be aware of both. Make sure your tenant is familiar with all the rules. If not, tell him which rights and obligations are included in the contract. After all, your budget depends on the tenant, and maintaining friendly communication can really help you have a great landlord-tenant.
5. Eviction Laws
Just like landlord-tenant rights, each state has its own laws and procedures in regards to evictions. A part of this work is to become familiar with all the laws. Every misconception or misunderstanding can make a mess. Nobody wants to have problems with the law so, why not keep that at bay and help your tenant with what he needs. These detail the types of notices and time frames that a landlord must provide before legally being able to evict a tenant. While you certainly never want to evict a tenant, it’s important to be informed of these laws and procedures just in case.
Now that you have a clear image of what the procedure of renting a place to tenants is about, it will be much easier to start with this journey: find the tenants, explain to them these rules and obligations, stick to your side of the contract and try to always maintain a good relationship with them.
6. You’re Always on-Call
As a landlord, you don’t clock in and out of work. Issues and emergencies can arise at any hour of the day or night. As such, landlords are always on-call. In the event that a water mains breaks, a door lock jams, the electricity goes out, and so much more, you are your tenant’s first line of defense. If they need you, you must be available. It’s as simple as that.
7. You Need to Know Your Renter
When you begin to advertise your property, you open your door to people who may be deceitful, destructive, fraudulent, or more. Once you’re locked into a rental contract with this person, it can be extremely complex and costly to get rid of them.
As such, it’s important to thoroughly vet any renter with whom you’re considering signing a house rental contract. Ensure that they make enough income to afford your rent. Verify their credit score to see if they have a history of financial responsibility. Perform a tenant background check to reveal any evictions in their past. It’s important to protect both yourself and your property.