Steps That Will Increase Your Revenue and Profit!
Making the decision to put your property up for rent is nerve-wracking and exciting. While visions of dollar bills might be dancing in your head, the reality is that you have some work to put in before you can begin to think about profits.
You might think that you can simply snap a few photos and put your listing on a real estate site, but going this route skips so many important steps that will come back to haunt you later on.
Every piece of property, whether for sale or for rent, needs to be prepared before it hits the market. Some landlords call this a “Make Ready.” Not only will it ensure you cover all your bases to keep yourself, as the landlord, protected, you’ll also have an opportunity to increase your revenue by attracting the right tenants.
Here’s a look at the steps you need to take to get your property ready to rent out and start your journey as a landlord on the right foot.
Do a Walkthrough
Before you do anything else, walk around your entire property, inside and out, and try to see it through the eyes of a potential tenant. What features might they love, and what can they do without? Are there any safety hazards to consider, or areas that might not be suitable for children? Also make note of anything you might want to take out, such as furniture or equipment. If you wouldn’t want someone using it or breaking it, it should go elsewhere.
Use the walkthrough as an opportunity to write down repairs and things that need to be cleaned. Examine everything, from bathroom light bulbs to the stove and even heating/cooling systems. Everything should be in working order when your tenants move in. Also be sure to keep in mind legalities and things that you’re obligated to include, such as smoke and carbon monoxide detectors.
You can find information on your state’s specific requirements in this area here. The walkthrough gives you a chance to mentally prepare and visualize all that you need to do, so take your time and be thorough.
Make All Repairs, Major and Minor
After your walkthrough, take your list of repairs and get to it. Don’t overlook anything, because your tenants won’t. It might seem obvious that the washer and dryer will need to be in working order, but you might not realize that a leaky faucet or broken window screen can affect quality of living and thus the happiness of your tenants.
Think about how you would feel moving into a rental in such a condition. This not only comes down to tenant happiness, but also general home maintenance. Never forget that you own this property. It is yours to take care of, and every repair you make is a preventative measure.
Some things to ensure you check and repair if necessary include:
- All appliances, including the washer and dryer, stove, dishwasher, garbage disposal, etc.
- Light bulbs in every room as well as outdoor lights
- Leaky faucets
- Poorly draining showers
- Broken cabinets and doors
- Torn window screens
- Walkway trip hazards
Clean, Clean, and then Clean Again
Most rental agreements include a provision stating that the dwelling must be left in the condition it was found. This means that if you let your tenants move into a pigsty, they are under no obligation to leave it in any better shape.
If you want to make a good impression, attract quality tenants, and be left with little to no mess when someone moves out, you need to invest the time and/or money to thoroughly clean it. You can either take the time to do this yourself or hire professional cleaners.
If your rental has carpets, definitely get them deep cleaned, particularly if someone else lived in it recently. This is not only an aesthetics factor, but a health and safety one as well. If your future tenants have young children who are crawling all over the floor, they’ll feel at ease knowing it has been cleaned.
If you’re taking care of the cleaning on your own, don’t neglect the hidden corners and hard-to-reach places such as:
- The tops of fans
- Inside kitchen and bathroom drawers
- Underneath the sink
- In the corners of closets
All of these places can attract dust, mold, and all forms of debris. Speaking of mold, if you encounter any, it absolutely must be cleaned as it is a safety hazard. Black mold in particular is dangerous, so contact a professional if you feel the issue is beyond your control (if you’re not sure how to identify black mold, check out this resource). Mold can be a sign of water damage and leaks as well, and those types of repairs should not be put off.
Curb Appeal Applies to Rentals, Too
The inside has been repaired, cleaned, and is now ready to be rented out. Right? Not just yet! Many landlords fail to take into account a very important concept in all real estate deals: curb appeal.
Your tenants might not be the owners, but that doesn’t mean they won’t take pride in where they live. If the property looks run-down, outdated, or unsafe, prospective tenants will be less likely to bother viewing the interior because they will expect the same level of neglect.
In addition, a property that doesn’t look like it has been well taken care of can indicate to a tenant that the landlord is lax about repairs and maintenance, and no one wants to land in that kind of rental situation.
You don’t have to do a full-on remodel, but at the very least get the exterior cleaned or slap on a fresh coat of paint, spruce up the landscaping, add in a fence if you’re on a busy street, and make the house look and feel welcoming.
Make Sure You Keep Your Lender and Insurance Informed
The final step before you start looking for tenants is ensuring you’ve followed all the procedures required by your mortgage lender and your insurance company. There may be information in your mortgage contract about rental properties, so check there first if you’re unsure. In any case, you may need to notify your lender in case they have stipulations regarding renting out a property you still owe on. You definitely don’t want to be dealing with lender issues after you’ve found the perfect tenants.
After you’ve gotten approval from your lender (if necessary), you absolutely must look into insurance options. Being a landlord comes with a lot of risk and responsibility, and the proper insurance can help offset the cost of any mishaps.
Landlord insurance is similar to your typical homeowners insurance and will cover things like fires and hailstorms. However, it also protects against landlord-specific situations such as loss of rental income and increased injury liability. These are things that would not be covered under your ordinary homeowners insurance policy. For more information on landlord insurance, talk to your current insurance provider or take a look here.
At the end of the day, preparing your property for rent is all about seeing things from the perspective of a tenant. Everything you do has the goal of attracting the right tenant and/or keeping them living in your property for the foreseeable future.
It might cost you some money upfront to prepare, and it’ll definitely take some time, but once you find a quality, long-term tenant, you won’t regret it one little bit.