Renting a home can be tricky, and finding ways to make it a safe transaction take some time and diligence. There are different considerations that must be taken into account depending on whether you are a renter or a landlord. Let’s take a few moments to look at both sides.
Renting – the landlord side
There are a wide variety of reasons that you might have to rent out your house. Perhaps you are in the military and you are being temporarily assigned to a new duty station. Or you need to get a little extra income and you have space in your house for a college student to live in. Each of those reasons is perfectly valid, and has a different set of factors that have to be considered before the tenant moves in.
For everyone you rent to, a background check is always a good idea. It will cost you between $25 and $100, depending on how deep the check goes. The last thing you want is to be stationed in Germany, helpless to deal with a tenant who has damaged the house.
Second, you will need to find out if there are any additional costs involved in renting, like fees or taxes you will owe to the city for being a landlord. There may also be HOA considerations to be met or additional dues that have to be paid. You will also need to be financially able to handle the times when your house is not being rented, because that mortgage won’t go away.
To help oversee the tenants and to make sure your rent is collected properly each month, particularly if you will not be living on-site, consider hiring a property manager who can be your representative.
Make sure you also have enough of the right kinds of insurance beyond homeowner’s insurance. Your agent can help guide you so you have all of the right coverage.
The easiest way to determine what you should charge for rent is to do some research using sites like Zillow, Trulia, or Home Finder. This will give you an idea of what comparable homes are renting for. If you are only renting a single room, look at the apartment sections to get an estimate of a fair rent amount.
Renting – the tenant side
As a tenant, make sure you take out renter’s insurance to cover your own property and belongings inside the house or room. Your landlord should also have a rental agreement or contract for you to sign that will protect both of you legally.
Check other rental units in your area to see if the room you are considering is fairly priced. Do a quick Google maps search to confirm what you are looking at is the same as what you see when you drive past the place. And, when you contact the owner, make sure he or she is ready to meet with you or have his or her property manager meet with you if the owner lives out of state. Mailing you keys, rents below market value, and a Google search that turns up empty are all red flags of places to avoid. Also, if the landlord wants you to wire money to him or her before anything is signed, walk away and be glad you didn’t fall into a scam artist’s trap.
Whether you are the renter or the landlord, a little prep work ahead of time can save you a ton of grief later.
