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Do You Know The Things Involved When You Rent Out Your Property? |
By:
Jacques Coquerel |
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do you know the things involved when you rent out your property?
Jacques Coquerel
Many people are saying, including real estate investment advisers, that renting out your property is one of the best strategies you can employ to earn substantial cash flow. But is there some grain of truth about this? Before you rent out your property, take some time to know some important considerations about renting out your property.
If you have no previous experience, you need to know the cost involved in renting out a property. You have mortgage payment, property tax, insurance, and maintenance. In order for you to take home a positive return from the rent, you rent price needs to cover all these cost plus your markup for profit. If you have a lawn, add the cost to maintain this lawn to your maintenance cost also because your tenant will not pay for this.
Your next problem is how to determine the correct rent price for you to make profit and still remain completive in the market. You alone can determine this. But there some key elements considered by seasoned investors when determining the right rent price.
Of course if there's a demand for house to rent you can jack-up your rent price a bit. The next you need to consider is the location of your house. If it is located near business establishment then it's a candidate for higher rent price. Don't forget to factor in the structural soundness of your property. You can be able to charge higher rent if your property is structurally sturdy because you can vouch the safety of your tenants.
Before you rent out your property, be sure that it has been recently inspected by health and safety inspectors. They give out certificate or signed document as a proof that your property pass health and safety standards and you can show this to your tenant to demand higher price. You also need this certificate as evidence that your property is habitable in case your tenants comes up with a silly law suit claiming that they've developed crazy diseases while living in your house.
It also pays to know your rights and obligations as a landlord and the rights and obligations of your tenants too. Tenants nowadays are more aware about their rights and they know that they can sue you if they found a tint of hazard in your property. Protect yourself from these silly law suits but educating yourself about your own rights too while meeting your obligations as a landlord.
When you rent out your property, you're opening it up to tenants that don't know how to care of a house. They know that you're obligated to shoulder the repairs so that they don't care about trashing your property. That is why it is important for you to screen your tenants and accept only those you can trust to take care of your property.
At the end of the day, if you plan to rent out your property, you must be prepared to become a landlord. You must know that being a landlord means to be on call 24/7 to take care of your tenant's house-related problems. Of course you can hire a property-management to take care of all these for you, but be prepared to pay them at least 10% of the monthly rent price of your property.
Author Jack Cockrel is a real estate investor in Atlanta, Georgia. He has made more than 750 real estate transactions since 1996. For http://www.getquantumleap.com/) Real Estate Investing Tips get his free course http://www.getquantumleap.com/) Real Estate Investing Free Course.
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Article Source: http://www.statssheet.com/articles/article71397.html |
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