Have you inherited a property?
Are you moving out of the home you currently own and rather than selling it in a rapidly cooling market, you want to rent it out instead?
You’d be described by many in the real estate and property management industry as an accidental landlord.
If you never planned to be a landlord but you find yourself with a property that you’ll be placing on the rental market, you’re in a pretty strong position. Boston is always a great place to rent out a home. There’s a high demand for well-maintained rental homes, and this market has a lot of highly qualified tenants as well as rising rents. In the long term, you’ll see your property value rise and your ROI increase.
However, you’ll also be expected to do all the things that landlords are required to do. Here’s what you need to know before you rent out your Boston home.
Study the Boston Rental Market
It’s hard to have a successful rental experience if you don’t know the market. There are two things you need to do as an accidental landlord: study the behavior of the Boston rental market and then prepare your property to be attractive in that market.
- Understand the Boston Rental Market
It’s important to get an idea of what homes like yours are renting for, and how many of them are currently on the market. You’ll also need to spend some time thinking about the location. Is your property well-located? Think about what tenants are looking for. In some neighborhoods, they might expect granite counters and stainless appliances. Other communities will simply demand a reasonably priced home in a safe neighborhood close to good schools.
Take some time to learn where and how your property fits into the rental market and what types of tenants you’ll likely attract. Get to know the rental laws as well. You need to know the difference between a pet and a service animal when you begin renting out a property. You’ll also need to understand how to hold a security deposit and what kind of process to follow when you’re giving it back at the end of a tenancy.
- Prepare your Property for the Rental Market
Before you post your ad and market your rental home, it has to be move-in ready. Tenants aren’t going to be interested in renting a home that isn’t clean, isn’t repaired, and doesn’t have curb appeal. Make sure all personal belongings have been removed. Get the home professionally cleaned, and pay attention to your landscaping. Make sure this looks like a home a well-qualified tenant would want to rent. Take care of every potential maintenance issue, whether it’s a leaking faucet or a screen that’s loose. Fix any outlets that don’t have power, check window locks, replace damaged carpet or old appliances, and test all the toilets and tubs.
Update Your Insurance Policy
Whether you once lived in the home yourself or you inherited it from a relative, there probably isn’t the right insurance on it to protect you as a landlord. Convert the homeowner insurance policy that is likely covering the home to a landlord policy.
This will change what’s covered.
As an occupant of the property, the owner gets coverage for the dwelling itself as well as all of the property contained within that dwelling. As a non-occupant, however, your landlord policy will only cover the structure of the home. Your tenant’s possessions will not be covered. This makes it incredibly important that you require your residents to acquire their own renter’s insurance.
Additional liability is also provided when you buy a landlord policy. This will protect you if a tenant or a tenant’s guest is injured at the property. When you talk to your insurance agent, discuss other coverage. Loss of rent, for example, can be valuable in case your tenants need to move out during a catastrophe and you cannot collect rent from them.
Prepare to Market Your Property to Boston Renters
Once the home is ready to rent, it’s time to think about marketing.
First, you need to price your property accurately and competitively. You also want to make sure you’re earning as much as you can. Pricing can be tricky if you don’t have reliable data.
The amount you can collect in rent will depend on a few important factors:
- The home’s location
- The home’s size, floor plan, and amenities
- The condition of the property
- The strength of the Boston rental market
Take some time to get to know what other homes are renting for around you. This data will help you price your own property accurately and competitively. Don’t hold out for the highest possible rental amount. A vacancy is costly, and if your home isn’t occupied then it’s not earning any money.
Online advertising offers the best chance of attracting good tenants fast. Use all the popular rental sites, including Trulia, Zillow, HotPads, Rentals.com, and HotPads. Make sure you provide high-quality pictures, detailed descriptions, information on the rental price and terms, and your contact information.
Then, be available to show your property to interested tenants. Answer questions, offer applications, and follow up to be sure you get someone in place quickly. Don’t leave phone calls unanswered, and respond to every message. You don’t want to lose potential tenants.
Once you are showing the home and applications are rolling in, you’ll need to screen those potential tenants. If you don’t have the resources to check nationwide eviction records, conduct background checks, or run credit reports, work with a Boston property management company or a third-party screening service. Placing high-quality tenants is essential to your success as a landlord.
Partner with Boston Property Managers
We’ve covered some of the early steps you need to take as an accidental landlord. You also need a great team of vendors to respond to emergency and routine maintenance issues. You need to implement a rent collection policy. There’s the lease agreement that needs to be signed and inspections and enforcement.
It’s a lot, especially for landlords who have never done this before.
Consider partnering with a Boston property management company that’s experienced. We have systems and procedures in place already, and we can help you become a landlord with minimal frustration and uncertainty. Contact us at Platinum Realty Group, and we’ll help you have a great experience.