Tag: #rentalproperties

How to Rent Your House, Part 2

Posted on | by Allison Zuck

Here’s the second part about how to rent your home! With this list, you should have a good start on thinking about renting your property!

Charging Rent

This actually simpler than you may think. You don’t have to think about a price yourself; check the market instead! You want to compare to places around that are similar. You can look on places like Zillow, or call other landlords in your area. If you have a property manager, they are also a good source to check on this. Don’t forget your security deposit, which should go into a bank account untouched. Check your local laws, but typically it’s a month’s worth of rent!

Rental Application

You’ll want information such as the employers, social security number, past addresses, phone numbers, and all other identifying information. Don’t forget to charge a rental application fee. This should cover the background check that you should always do. Decide what you’ll be comfortable with after the background check. It’ll show information of felonies, bankruptcies, or other history that could be of interest to you. Decide who you are comfortable with allowing to rent your property!

Release of Information

Require a release of information signature. You should check up on all your potential tenant’s claims, but the most important is their source of income. You want to know their job stability and earnings. Then, check on previous landlords. Ask about what rent they paid, if they got the security deposit back, and if the landlord would rent to these tenants again. These sources of information will give you a great idea of what this tenant will be like.

Choosing Your Tenant

Make sure to process your tenants in the order they come in. That way you will not get complaints about discrimination. If you deny a tenant, provide written documentation for the reason you turned them down. When you choose your tenant, you can verbally let them know.

Rental Lease Agreement

Usually these lease agreements are for a year long. They should include information such as the tenants names, the lease agreement, how much rent is, how much the security deposit is, what rules there are, and other things like this. When the tenant is ready to sign the agreement, walk them through it. Verbally repeat these things so you are sure the tenant knows their responsibilities.

Property Inspection

Once the lease agreement is signed, walk through the property. Take detailed notes of what condition the property is in, and have the tenant note any issues as well. This is to know what is a preexisting condition, and what damages the tenant may have done to the property.

These are just a few basic steps to renting your property! Make sure that you are well prepared before stepping into the role of a landlord, and it will go just fine!

 

To learn more about this topic, check out the article that inspired our blog: https://www.biggerpockets.com/blog/how-to-rent-your-house

How to Rent Your House, Part 1

Posted on | by Allison Zuck

Renting your house can seem daunting. You want to make sure you get every step right before you get tenants in there. However, renting is a great way to get a steady flow of income. In the next few blogs, we’ll go through the steps to rent your house so that you’ll be fully prepared to do it!

Why You Should Rent

First, you make your home into an asset. Instead of just being there, it’s bringing you money. Hopefully, the rental income will also pay off your mortgage, which saves you money, and then put the additional amount in your pocket. It’s an easy way to dip your toes into investing, and it’s even better if you aren’t sure if you’ll need your house again. After all, if you decide you want to move back into that house, it’s always an option.

Finding Tenants

You want to have a large selection of tenants to choose from. So, don’t just stick a sign in your yard (although that’s a great thing to do anyway). Expand your search online! Put your house on Zillow and Craigslist! For safety though, on Craigslist, don’t put your exact address. Hopefully you’ll have a lot of applicants! And then, you’ll need to narrow them down! Have a list of criteria that each tenant needs to meet, such as a base income, good references, and a good credit score. If they don’t match those specifications, don’t spend time vetting them further.

Also decide if you want to hire a property manager! Our last two blog posts talked about the pros and cons of that, and you can look through those posts to decide what would be best for you! Next week we’ll look through a few more steps of renting out your home!

 

For more information, check out the article that inspired our blog: https://www.biggerpockets.com/blog/how-to-rent-your-house

Property Management: The Pros and Cons

Posted on | by Allison Zuck

Two weeks ago, before the holiday, we covered the pros and cons of self management. Although we are a property management business, we want to be completely transparent with what you are getting into. We want you to make the best choice for your real estate, even if that’s going with self management instead of using us. However, we also want you to be fully informed. So, here are some pros and cons of hiring a property manager.

Cons of Property Management

First, you do not get to dictate how the property is maintained. When hiring a property manager, you are saying you trust them with your investment. If you hire the wrong property manager, this could potentially backfire.

The other biggest con is the cost. You have to be able to afford the rates property managers charge. They’ll take a cut of your profits. Additionally, they’ll take a fee for the new tenants they bring on board. However, as long as they fit within your budget, that shouldn’t be too much for you to handle.

Pros of Property Management

They make your life easier. After you hire a property manager, you are essentially earning income while hands off. They have more specialized knowledge of the market, as they keep track of many properties.

Additionally, property managers don’t have the same emotional connection to your property. That means they can make objective decisions about your property that you may not be able to do.

They also have a network of maintenance services, so that you don’t have to scramble to find someone to fix issues in your property. Essentially, with just a monthly fee, they’ll take care of all the day to day decisions about your property, leaving you to focus on more important things.

Essentially, you need to decide what’s best for you! You know your property the best. If you think it will flourish more with a property manager, get one! If you think self-management is the way to go, stick to that plan. You can always change your mind and go a different route if the first doesn’t work for you. Just do what’s best for your business!

To learn more about this topic, check out the article that inspired this post: https://www.biggerpockets.com/blog/property-management-vs-self-management#the-bottom-line-no-one-cares-about-your-properties-like-you-do

Self Management: Pros and Cons

Posted on | by Allison Zuck

Property management is an essential part of real estate investment. There are pros and cons to the two options you have: doing it yourself or hiring a property management company like All County Legacy. Often, it can boil down to costs and your own personality. So, lets dive into some of the details of self management this week and next week we’ll cover what the advantages and disadvantages of hiring property management is.

Self Management

Self management is when you are the only one responsible for your property. You get all the profits, but you also do all the work. Here are some pros and cons:

Pros:

You don’t pay a property management fee. Because you are doing it all yourself, you are saving the cost of their services.

You also get to choose your own tenants. If you are very selective about who lives in your property, not hiring out to a property manager can make sure that you get to choose your own tenants, instead of relying on someone else to make the selection for you.

Cons:

It’s a large time commitment. Many real estate investors are looking for a stream of income that does not consume their days. Fully managing their own property would take up quite a bit of time.

Additionally, you don’t have an expert on hand to ask questions to. You will have to keep your real estate knowledge current, to make sure that you are making smart decisions and following the law. Not only will your property manager have up-to-date knowledge, but they will also have connections and experience that will help you make financially sound decisions; something that could be harder for you to do on your own.

Next blog, we’ll look into property management. Taking a look at both ways to care for your property will help you make the best decision for you, which is most important for your investment business.

 

For more information about this topic, check out the article that inspired this post: https://www.biggerpockets.com/blog/property-management-vs-self-management#the-bottom-line-no-one-cares-about-your-properties-like-you-do

The Cons of BRRRR

Posted on | by Allison Zuck

Now that we know what BRRRR is and what the pros of doing it are, we can take a quick look at some of the cons. Whenever we talk about cons, it isn’t to deter you from trying something new. Instead, sharing some of the drawbacks of certain types of investments can help you decide what you need to watch out for in trying this new venture! Or, it can encourage you to try a different type of investment; one better suited to your station in life.

Now, the cons:

Interest and Appraisal

First, you’ll need to consider money. You will most likely get a short term loan, which will have high interest and could result in an initial negative income. However, if it’s the right property, this should only be a temporary setback. But if you’re already struggling with making ends meet, this may not be the best plan. Additionally, fixing up a house means knowing how much that will cost, so make sure your initial appraisal is close to correct. Unfortunately, in home repair, things pop up all the time that could add to not only the expense of the upgrade, but also the time.

Refinancing and Loans

Banks have a “seasoning” time, where they wait a set amount of months (usually half a year to a year) before refinancing the property. While this is very reasonable, it could cause some problems, depending on how long your short-term loan extends. Therefore, make sure it is at least 18 months long, giving the bank plenty of time to “season” your property. As for the loans, you’ll have to juggle two: the short term one, and the one you take on when the property is refinanced. Make sure to shop around for the right lender and get the best deal on fees.

Property and Tenant

Make sure you are up to doing major renovations yourself. If you don’t like heading up big projects, BRRRR may not be for you. Additionally, don’t get so wrapped up in the project that you don’t select the right client. It’s still important for you to get a right tenant, so continue good practices in vetting the tenant before you approve them.

BRRRR shouldn’t be scary. These past three posts are here to help you realize if it’s right for you, not scare you away! It can be an accessible start to real estate, but make sure you know what you’re getting into!

For more information about BRRRR, check out the article that inspired this blog: https://www.biggerpockets.com/blog/brrrr-pros-and-cons