When people buy a house, most don't expect to rent it out. Accidental landlord situations tend to happen when homeowners have to relocate due to unforeseen circumstances.
Accidental landlords often lack knowledge of the ins and outs of leasing a property. They may be unsure about financial decisions, lease agreements, or property management.
However, if you're forced to become an accidental landlord, it's not impossible to learn. It can take some time and research, but you can learn how to be a successful landlord. Here are tips that can help you get started.
Brush Up on Local Laws
If you're an accidental landlord, there is a good chance you don't know the local laws. Before leasing out your home or unit, familiarize yourself with state, city, and local laws about leasing properties.
It's important to understand your area's tenant-landlord laws regarding factors like rent control, application fees, and HOA limits. This way, you don't accidentally break laws.
Always Use Formal Contracts
Protecting yourself as a landlord by using a formal contract for lease agreements is essential. Have a legal agreement outlining expectations and requirements for leasing your property.
This will ensure that you have something in writing to point to if something goes wrong. You may want to consider having a lawyer review your agreement to ensure it's in good condition.
Screen Tenants Thoroughly
You have to approach tenants like a business decision. This requires a thorough background check and screening before allowing them to move into your unit.
You want to look for tenants with a stable income, good credit score, and good rental history. You may also want to consider getting references from previous landlords or employers.
Get Help With Taxes and Finances
Most accidental landlords may not know what that now means for them financially. It's best to let experts handle or advise you on what leasing a property means for your taxes and finances.
You should go to a tax expert to explain what forms you need to file and how much you need to pay. Having a financial advisor who can help you manage your new cash flow may also be helpful.
Consider Property Management
Accidental landlords often don't seek out being landlords and, therefore, don't want to deal with the requirements of being one. These can include property maintenance or dealing with rent.
Accidental landlords may consider hiring a property manager to handle these and other, perhaps more unexpected, issues. They can do everything from collecting the security deposit to managing grievances.
Your Guide to Becoming an Accidental Landlord
Not everyone sets out to become a landlord; for some, it happens due to life changes. Though you may not know the ins and outs of being a landlord, you can learn the basics with research.
Whether you moved in with a partner, relocated for work, or moved to be closer to family, you may be thrust into a landlord position. These tips can help you navigate your new position if you become an accidental landlord.
Property Management Inc. provides quality guidance through fostering community and trust. Contact us today to inquire about our property management services.
