Renting a house out for the first time - any tips?

Question

If you had one suggestion that you wish you knew when you were first starting out, what would it be?

JD Martin · Answer

My tip: take no shortcuts! What are shortcuts?

- The first applicant to come along with cash in hand;

- Cosmetic cover-up of structural issues;

- Half-assed cleanup/fixup efforts

ETC. Screen your applicants! Fix your units properly! Clean and dress diligently!

Remember, you have in your hand an investment vehicle worth 5-6 figures, maybe more. You are not dealing in plastic monopoly houses, and you are setting the stage for real people to live their real lives. Treat the endeavor with the reverence that it deserves, not as some get-rich-quick scheme that has you skimming profits while everything descends into chaos.

If you treat your property as though it were something of value worth treating right, and make all decisions based on the idea that you are providing a quality product to a quality customer, you may not always make the right choice, but you will always have the right intention. And that, my friend, will make you a lot of money in return :)

Jim Shepard · Answer

Your most important asset that you possess is your time.  I do not set up individual appointments for showings.  Only half the people will actually show up for the appointment.  Some are tire kickers.  A lot do not qualify.  I always do an open house instead.  You create a lot of excitement having that many people in the house at one time!  The trick is to quickly evaluate the people and if they don't meet your criteria, move onto the next prospective tenant.

Jeffery Griggs · Answer

Don't be so anxious to get it rented that you just take the first applicant. Screen Screen Screen the tenants. Having a great tenant will make all the difference in the world.

Landlording on Autopilot by Mike Bulter is a great book\resource on landlording.

@MarciaMaynard did a podcast that discusses a lot about landlording. Here is a link to it...there is also an very good list tenant screening interview questions.

http://www.biggerpockets.com/renewsblog/2014/08/14...

Good Luck!!! Let us know how it goes or if we can help.

Esaul Viramontes · Answer

Problem is........that sounds like a fair housing discrimination violation based on FAMILIAL STATUS

Javier Tejera · Answer

Hello Chris and welcome,

I agree with most (not all) the comments, I've been renting for 10 years, no PM. If this is what you want then here are some tips... These are my opinions and have worked for me.

Definitely Screen, this is worth its time in Gold. Its best to have the property empty for 1 more month than to rent it to a Bad tenant.

First get several applications and number them 1,2,3 etc.. Have a Showing on a certain date and between certain hours, do not go meet people when they want, otherwise you will waste a LOT of time, they say they come and do not show! You can have 2-3 showings per week. Morning, lunch time and evening (weekend). Not everyone can come at the one time you set up a meeting...

Make Sure the property is finished! This is very important, have electric on, and water. You can have a friend come and act as potential renter (you can use your imagination here). Treat Everyone the same, in FLA there are State shoppers (like a White female with a Black Male couple) to see if you discriminating. So every one is the same!

If someone is really interested have them fill-out the app there if they can, and give you the Security deposit now (refundable if they don't pass the Mustard test). It could be more than 1,2,3 people you collect from (don't deposit the check(s)).

Now I guess it depends if you do the vetting or someone else, but if you are going to call previous Landlords, make sure you call 2 Landlords back, this landlord will give it to you straight, since he/she is not needing to get rid of your new tenants and will talk more candidly. Also, ask them questions to trip them up, like verifying the wrong rent amount. Why you ask? Because you may be calling the "Brother-in-Law" instead of the actual Landlord. Believe me I've seen it...

When you have selected 1,2 candidates, go to their house unannounced with an excuse you need more info, this way you can see their living style, cars up on blocks in their driveway, cleanliness etc...

No pets is better, but it depends on the house layout? Carpet, tile? Insurance issues, pet type.... Pets can be a money maker for you if structure right!

Hope this helps!

Javier T.

Account Closed · Answer

This.  I live in my house and rent the rooms out.  I've had some great roommates and some nightmare roommates.

Javier Tejera · Answer

@Chris A.

Well on the W/D its your call, they are a maintenance issue. If you put cheap and used, expect a call in less than 1 year potentially. If you put nice ones, and they break, then they will expect a nice one back in as a replacement ($$). I would put in normal top loader that's in good working condition and you would not expect issues with. The key is to minimize your maintenance. Some tenants may bring their own? I would advertise it without, and if they ask for it, tell them you can provide a W/D for $XX more per month. Dont get greedy, but make it palatable for them to pay for it.

Honestly on the refurbished ones, I'm not sure. What I've done is go to the Post Office get their Moving Package (paper form), in there there is a Lowe's 10% off coupon code, you will have to go online and request it, and you will get it in 30 days (not sure on your timing). Go to Lowe's and get the bottom of the price range new, both W & D, and ask the Manager for a 10% discount, you can throw in you are a RE investor and looking to get more W/D's and sometimes I get them to give me the 10% off (not counting or telling them you have a 10% coupon), and at the register hit them up with the coupon, since you have to pay before they bring them up front. Bingo almost 20% off new ones that will not give you any headaches for several years (plus have a 1 yr warranty). Note: for the one that may think this is not ethical, at the register I tell the cashier I got a discount from the manager and I'm applying this 10% coupon on top, when they scan it, it goes through, so "I tell them". I've done this about 4 times.  This costs will be close if not better than Refurbished + potential future repairs... It may cost you a little more now, but will save you headaches in the future. Also spend the money and get Stainless Steel braided lines if you can, they last longer.

Hope this helps!

JT

Jeff Beler · Answer

Everyone is pretty bang on here, but I would make sure that you have and air tight lease/rental agreement.

Also, know and your local and state/ provincial tenancy laws and by laws.  These are things you don't want to learn as you go, because you will get burned.

Good luck

JD Martin · Answer

Use durable materials. Skip the carpet for laminate, vinyl, tile, hardwood. No fussy countertops, things like that.

Robert M. · Answer

Agree with many here.

"Harden" properties before renting to save hundreds of dollars on each tenant.

PMs sometimes have motivations other than getting tenant that best meets your criteria.

Early on, it was suggested that I take applicants that ending up costing me 4 months rent in each case.

Screen and wait for right tenant. Do not sweat one months rent. A bad choice will cost many months ( 4-6 months) rent in the end.

Renting a house out for the first time - any tips?

Most Popular Reply