There are many things that can cause a homeowner to consider converting their home into a rental property. Are you pondering a move to another city or maybe even another state? Have you decided that now might be the time to upsize and purchase a larger place? Perhaps instead of trying to sell your current home outright as you move on, you might be considering the possibility of holding on to it as an investment property. In this blog, we are going to discuss a few strategies you can use to become a successful landlord.
1. Notify your mortgage and insurance companies. First, you should contact your current mortgage company. Some loan vehicles (such as FHA loans) mandate that the property owner must occupy all or at least a certain percentage of the property attached to the loan for a specific timeframe. The next important step is to reach out to the homeowner’s insurance provider for the property. They need to be notified of the possibility that you may be renting out the home instead of residing in it. The existing insurance policy on the home is most likely an owner-occupied one so it is crucial to modify the policy and coverage to ensure that the asset is properly protected going forward. You should also ensure that you are in compliance with all city, state, and federal regulations that are required for landlords.
A successful landlord will want to be aware and up to date on all of the potential tax implications that can apply to investment property ownership. If you rent out your property for more than 14 days, the IRS considers you as a landlord for tax purposes. You will be required to report your rental income to the Internal Revenue Service. However, now you can deduct rental expenses and also depreciation on the property and certain assets in the home such as refrigerators and washer/dryer sets.
2. Make sure it’s clean. Tenants will be very hesitant to move into a dirty or cluttered property that looks like a pigsty. Rental properties should be cleaned thoroughly and professionally prior to a tenant moving in. This process should be repeated after each tenant moves out.
3. Spruce up the landscaping. The curb appeal of a rental property is extremely important. It is often a key factor in attracting quality tenants. In addition, good curb appeal and maintenance can help keep the rental occupied going forward. It sets a tone for tenants on how you expect the property to be treated. Proper maintenance both inside and outside adds to the profitability of your investment. First impressions are usually important, but they become especially so when real estate is involved. Things like the front door, windows, walkways, storage areas, flower beds, and landscaping all add to the overall desirability of your property.
4. Check all safety features. New tenants should never be allowed to move into a property without the landlord first making sure that the smoke and carbon monoxide detectors are in proper working order. Other features, such as any motion-activated outdoor lighting, interior lighting, and door and window locks should also be in good repair. Finally, a good landlord is cognisant of other possible safety issues that could be present like tripping hazards or plumbing problems.
5. Include welcoming materials in your home. Having a welcome packet for your renters that includes things like a guide to local amenities, a welcome basket, or a small gift with a welcoming letter is a very nice touch. It can also be extremely helpful to include a guide of things to do nearby as well as good places to eat in the greater Hampton area. A list of contact information for local emergency and essential services is also a very helpful thing to provide your renters with.
6. Enlist the help of a (local) expert. Our Hampton area property management company provides property owners with numerous benefits and advantages. Our team of skilled professionals has the expertise to provide the highest level of customer service in the industry. We set you up to achieve the maximum return on your rental property investment.
PMI Green Rock partners with well-reviewed local vendors to help you maximize the return on your Hampton area rental. Our principal goal is to free our clients from the headaches and stress that come along with managing a rental property. With the benefit of our proven and streamlined processes, we can help you achieve the results you are looking for. Please don’t hesitate to reach out for additional information.