Turning your home into a rental property is an investment that can result in long-term benefits. Although the process of flipping your property into a rental is not short, Boise’s rapidly growing housing market has primed the rental industry to be vacant for years to come. In fact, Boise’s rental market vacancy rate fell to a record low of .75 percent from 2.77% twelve months ago. Because of Boise’s property shortage, the market is driving homeowners to convert their space into a rental property, but many homeowners don’t know how to get started. Iron Eagle Property Management has compiled a list of tasks for homeowners to begin on their rental property conversion.
Follow the Law
There are many laws and regulations that may inhibit you from renting your property. Before even starting the rental conversion process, you should check with your mortgage lender and your homeowner’s association. Your mortgage company may require your residency for a certain amount of time before being able to move on, while your homeowner’s association may not allow any rental properties at all.
Besides personal and Idaho law, potential landlords should also analyze federal laws. Federal agencies that have an affiliation with housing associations include the U.S. Environmental Protection Agency and the U.S. Department of Housing and Urban Development.
In order to become a rental manager, permits are usually required before putting your house on the market. Although obtaining permits are different in each city or state, there is almost always a mandatory inspection. The inspection is to ensure that there are no safety issues, missing or damaged components, and any other modifications that need to be made before the tenant moves in.
Repair For the Future
To avoid annual expenses on repairs and upgrades as a landlord, it is savvy to repair anything that needs relatively fixed. By doing this, the tenant will not request maintenance repairs as often and you will not have the continuous stress of having a rental property that is falling apart. It is a good rule of thumb to treat the property as if you were selling it to make the property more appealing to potential buyers.
Any repairs or improvements you make to your property can also boost the rental price before the tenant moves in. If the landlord must make periodic repairs while the tenant is under contract, those expenses may come out of the landlord’s pocket. Some cost-effective repairs that will increase the value of your property are replacing knobs and handles, paint, and carpet cleaning.
Personal homeowner’s insurance is simply not enough coverage for your rental property. Purchasing an insurance policy specifically for landlords will cover you from both property and liability insurance and leave you with the peace of mind that your house is protected from the most extreme mishaps. Some rental insurance can even protect you from legal expenses such as attorneys fees and property repair for inappropriate behavior by the tenant.
Talking to an attorney can also help determine if a limited liability corporation is right for you, depending on your insurance coverage. Limited liability corporations are easy to start and are perfect for those trying to become a landlord.
Hire a Property Management Company
Once your house is being rented, the job of a landlord does not become much easier. Many landlords that do not have time or do not live in the area of their property hire a property management company. A property management company takes care of the paperwork, repairs, rent collection, and even some legal procedures if needed. Ultimately, the landlord is giving up some of their duties to the property management company for a small percentage fee.
Iron Eagle Property Management represents your property with respect and integrity. Before you decide to move forward with renting a property, use this short list to guide you in the right direction. Take the time to talk to your partner to decide if renting is the right choice for you. If there is too much time, effort, or work involved, consider hiring a property management company to care for your property. Contact us today with any inquiries, concerns, or comments!