Long-distant landlord. Sounds like a hassle. You’re moving away and you want to rent your old place, but then there’s the rent to collect, repairs to finish, tenants to worry over…maybe it’s just not worth it.
Or is it? Renting a second home can be an easy way to build wealth because your tenants pay your mortgage for you. Every month, you get a free reduction in the total money you owe and a free increase in what you own, all on somebody else’s dime. What makes more financial sense than that?
While there are a few risks in renting property from a distance, the upside is very much worth considering. Remember these few tips and you’ll see how easy it is to manage and maintain your rental property from a distance.
Choose the Right Tenants
First and foremost, you need to find tenants that you are comfortable renting to. Since you will be far away, you need to be able to trust that they will look after your property responsibly and with respect.
Often times, this means getting references. References are a great way to find out if people are dependable and worth renting to. Most of the time, people will not endorse others whom they do not trust, so when you get a ringing endorsement about a tenant, you can usually take it to heart. Alternatively, if you get a bad one, then the red flag should go up.
Think about what the perfect tenant for your situation may be. If you live near a university, then maybe offering your place as student housing would be the way to go. Or, maybe you’d be more comfortable renting to a professional couple or family.
Whatever you choose, don’t settle just to rent the place. Make sure your are comfortable with the tenant.
Make Your Lease Strict
Once you find your perfect tenants, then you should do everything you can to lay down strict rules that they must abide by in order to continue renting. Remember: it’s your house, so it’s your rules.
What makes a good lease? Like with many things, it’s up to you. Do you want to allow pets and if so, how many and what kind? Can the tenants smoke inside, or should there be a strict no-smoking policy? Do you want to limit the number tenants? There are many things to consider when creating a lease.
The answers to these questions will be different for different landlords, but whatever you choose, make sure to get it all in writing. The lease is your way of protecting yourself and every important issue should be agreed upon and initialed by the tenant before renting.
If you’re not sure what to include in your lease, consult a lawyer. They can usually help for a small fee and it will give you peace of mind.
Finish Repairs Quickly
As the owner of the property, you will most likely be responsible for all repairs. While this can be annoying at times — especially if you have trouble with the tenants — it offers you a chance to fix things the right way every time.
If you can manage most repair yourself, then you are ahead of the game. This can save you both time and money. If you cannot make repairs yourself, then it’s not the end of the world. You’ll just have to call professionals.
Wherever you live, there are scores of businesses that can help you with any necessary repairs. If you need a boiler replacement in North London, then a company like Applioque can help. If you need new windows or drywall repair or your property is having plumbing issues, then there are companies that can help with those issues, too.
If you can, form a good relationship with local businesses: you never know what discounts they may offer to good customers.
When in Doubt, Find Help
If you want to rent your place out but aren’t sure how to go about it, then look for help. There is no sense in going at it alone if you are uncomfortable with any aspect of renting.
There are plenty of property management experts out there to help you get started, or even to watch over your property for the times when you are unable to return. They can also help collect rent and repair problems.
Renting your property can be a great wealth builder, so whatever you choose, make sure you keep these things in mind.
Ray Le Blanc started out in 1998 straight from school, father was also a plumber. Attended college and apprenteship for a London based company before starting work for himself in 2007. Success has come through high quality work leading to referrals from happy clients.