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Maybe you have an in-law apartment you’re considering renting out, or perhaps you’ve bought a new home and are thinking about renting your current one out. Whatever the case, becoming a landlord is a big decision. If you’re just starting to toss the idea around, here are some key things you may want to think about:
Understand Your Requirements
It’s important to understand the tax and legal requirements of renting out a space or entire home. If you’re renting just a portion of your home, it’s also important to verify that it's a legal apartment for you to rent. Do your due diligence here early on in the process so that you can troubleshoot any challenges before getting too far down the line.
Set a Budget for Updates
If you’re planning to newly rent out a space, it’s likely you’ll want to give it a bit of an update. This could mean anything from a fresh coat of paint and detailed cleaning to a complete overhaul. Whatever the case, set your budget and stick to it. If your budget is small, simply map out what you can afford and prioritize the most important things. If you’re planning a bit of a renovation, consider your timeline as well as your budget so that you’re able to start renting when you want.
Use a Written Lease
It’s also wise to use a written lease. Some landlords write their own lease while others use more of a temple; often you might find that you start with a template and augment it to meet your needs. Even if you’ll only be renting month to month, it’s still wise to have all your paperwork in order.
Properly Screen Potential Renters
Once it’s time to find your tenant, it’s important to take the time to properly screen your applicants. Many landlords check credit scores, run a background check, and contact references. It can feel like a lot of leg work, but it’s worth it in the long run to have a renter that you feel confident in.
Have you ever considered renting out your home or a portion of your home? How do you feel about the idea of being a landlord? What benefits appeal to you most? Which challenges are the most pressing for you? I’d love to hear your thoughts!