Before renting, there are 10 critical steps you need to take before renting your property. In today’s market many people who choose not to sell their house are choosing to rent, but there are some fundamental differences you need to be aware of before entering the landlord arena.
1. It’s not your house anymore – it’s a business and it needs to be treated like a business. You will need to learn to distance yourself emotionally from the property.
2. Call your insurance company and let them know it is no longer your primary resident and that it is now a rental. If you don’t – they won’t cover damages.
3. Genericize paint colours or repaint. Just because you like orange and green living room walls and your daughter loved her dayglow purple room – doesn’t mean renters will find these colours attractive. The paint colour needs to be neutral enough that any colour furniture will match the wall colours. If you haven’t painted in 10 years – it will need freshening up. Don’t let your 13-year-old work on it in between homework – hire a professional painter.
4. Fix and repair! That screen on the front door that’s ripped out? Fix it! The leaky sink or toilet that takes 3 flushes? Get it repaired! Your house needs to create the very best impression from the first few seconds prospective tenants enter. Any water leaks can turn into potential disasters which will cost you big bucks in the long run and could cause potential health hazards (mould). Anything included in the Minimum Housing Standards Act such as having screens on the windows must be completed.
5. Clean before showing. Aim for 5-star hotel standards and have it professionally cleaned. It’s a price war and a beauty contest right now. If you want to attract clean tidy people you must have a clean tidy place. No one wants to inherit someone else’s filth.
6. Do a spring/fall yard cleanup which includes paint touch ups and cleaning out the eavestroughs. Hiring someone on Facebook side jobs can get these tasks completed for nominal costs and will leave your yard looking well maintained.
7. You probably won’t bank the entire rent – you will have expenses. Anticipate 1-5% of your home’s value in repairs. Operational repairs – returning your property back to its original condition (leaking toilets, washer/dryer repairs) are usually not too expensive. Capitol costs such as replacing the roof, hot water tank or furnace you will need to save up for. Check the dates on your furnace and hot water tank and have them serviced regularly.
8. If you are expecting your tenants to do yard maintenance or change the filters on the furnace be sure to let them know what is expected, how often and how/when it needs to be done.
10. Once the tenants are in – how do you deal with tenant expectations? Align yourself with support groups. Take courses Join a landlord network such as Landlord Knowledge Network Community (Facebook and Meetup) and join Calgary Residential Rental Association CRRA or your local community landlord/tenant association – they’re worth their weight in gold.
To be well prepared for your new role, be sure to follow these critical steps before renting your property.
Nelda Schulte is a property investor who is passionate about helping investors who self-manage have profitable investment properties through resources and education. If you struggle with the wrong landlord forms, or worse yet, no landlord forms check out Nelda’s 10 Essential Editable Landlord Forms that help you separate the good tenants from the bad and increase your property’s profitability.