Tips on how to rent your house are easy to find online in terms of put an advertisement up here, ask that question, advertise this price and so on. It’s not hard to find. When I rented my first unit I didn’t even check the Internet for advice. I just did what felt right and went with the flow. It worked out well but I soon realized a structured plan is better.
Rather than providing you with a series of steps to rent your property, instead I’d like to refer to anecdotes and personal experience over the past 17 years since I first became a landlord. And since I’ve rented out both a house and a condo myself and with a rental agency, I can speak about each scenario.
How To Rent Your House
It’s easier to find a good tenant than it is to get rid of a bad one. Doing the proper background checks up front gives you a better chance to find a good renter that may stay for years. Don’t cut corners when gathering information on prospective renters and use everything that your local laws allow you to consider. Use government-approved forms if they exist so you are following the law and aren’t wasting time coming up with your own. Trust your gut and use common sense, too.
Property Rental Process
In my experience, you are best served by using whatever documentation, applications, forms and laws are applicable in your local area. Don’t reinvent the wheel putting your own application together because you’re wasting your time, possibly forgetting to request some information and may violate the law if you ask for something you shouldn’t.
Whatever you are allowed to request, get it. A completed rental application, proof of income, credit check, references, letter of employment, and whatever else is allowed is typically what we’re talking about. Get the same from each prospective tenant. If it’s a standard process, everyone should be ok providing the information in full. If not, it may be a red flag.
While certain restrictions may prevent you from meeting a prospective tenant face to face – they live out of town, COVID-19 lock downs, etc – do your best to “meet” each screened candidate somehow. Skype, Zoom and Facetime are a way to at least see them online and look at one another to see if this is a person you want occupying your home.
Why To Rent Your House
People rent their property for a number of reasons, namely they:
- Live in an area where you can earn profit through rent even with a mortgage.
- Own a property but can’t live in it (you live in another house, are out of town) and need a tenant to help pay the mortgage and reside there.
- Want to build longer term wealth through real estate.
- Can’t sell the home currently ie. the mortgage is underwater.
- Feel the local real estate market is weak and want to wait until it improves.
How To Find Good Tenants
I have avoided certain methods and certain websites to find prospective tenants. Call me crazy but I do believe that targeting certain avenues and ignoring others has helped. I understand that anyone can visit a website but you can target better quality tenants by thinking a bit about what you’re looking for. In my experience, I have have found quality tenants by focusing on methods that I believe will yield the best results.
I have paid a small amount of money – typically less than $20 – to run an ad online and have had success find them multiple times. I also had a couple who lived across the road from my sister referred to us and they lived in our house for 1 year while their home was being built. We didn’t know them but my sister did. There was enough familiarity to feel good but not enough familiarity that we were renting to friends.
Be careful when renting to close friends or relatives. Often they’ll expect the family and friends discount which may come in the form of asking for lower rent, paying late, leaving bills unpaid, and eventually stiffing you on paying the rent and moving out early. This happened to someone I know when he rented his house to a childhood “friend.” They’re not friends anymore.
Target Professionals
Do you have a property downtown in a city? You could target doctors, nurses, accountants, business people, engineers and other professionals who work in the downtown core. Put ads up in the local hospitals that reference how close your property is to their place of business. Doctors and nurses work odd hours. How many wouldn’t love to walk to and from work rather than driving or relying on public transit at 4am when their night shift ends?
If your building or neighborhood attracts people that work in specific industries or professions, you could mention it in the ad.
Target Families
Do you have a property in a residential area near schools? Think about targeting families. I have a house in a residential area and the last 3 tenants have all been couples (two married, one not yet married) and two had kids. It’s walking distance to schools and a playground. It’s perfect for a family. Not great for people who want downtown nightlife but that’s fine with me. I like the families. They’re stable and – touch wood – they take care of the house which is course is important.
Target Companies
Some companies will rent houses or condos for staff. Many will take a long term lease on a unit for several years. When I lived in my condo, the unit adjacent to me was rented by one of the major banks for their staff. They had the lease for several years with different people living there.
Renting to a company – especially a large well-known one – means they typically have deep pockets, will pay their rent and if you have a problem, you have a company to legally go after if needed.
Use Certain Websites Only
As mentioned above I avoided certain low end websites that I felt would target people I didn’t necessarily want to attract. I’m not trying to be judging but if you’re going to rent a property worth hundreds of thousands of dollars or more, you want the right person to rent it, right?
Think about your target market (doctors, nurses, families, etc) or think of your ideal renter and then figure out what websites they visit and the publications they might be likely to read. Contact the local trade organization and ask if they have members looking for a rental unit.
Use A Property Management Firm
I have used a property management several times for my house in the residential area as I’m not living near it currently. This firm offers the following services:
- Locates, qualifies and does background checks for all prospective tenants from beginning to end. I just choose the tenant we end up going with.
- Collects rent and manages the property on an ongoing basis.
- Resolves issues and arranges for repairs if needed.
- Helps me with tax payments to the government and acts as my representative in this matter.
- Conducts yearly inspections of the property with pictures provided.
If you don’t have the time, desire or skills (it takes work!) to manage an ongoing rental relationship, you might consider using a rental management firm to help out. Some will be happy just to find you a tenant and then drop out of the picture and leave the management to you. Others offer a full suite of real estate rental services.
Summary
Do the work up front to find the best tenant you can, and it will pay dividends possibly for years to come. The shortest tenant I had was 12 months (several times) and the longest is 10 years.
Think about how you can possibly target certain people that might be interested in your unit based on where it is located and the features it has. You might get access to someone that you otherwise may not find through a generic online advertisement although in my experience they have worked well too at times.