For Saibal and Alpana Chatterjee, much financial planning revolves around their two young daughters.
Of course, there will come a time when they will marry and start living with their husbands, but that is quite some years away.
Nevertheless, Saibal and Alpana want to secure their financial future. They should not face any monetary problems even after marriage.
Keeping this in mind, they invested in a couple of small apartments to rent them out. Their daughters will earn a regular income which will grow into a substantial corpus at the time of their marriage.
However, Saibal and Alpana faced some challenges while renting out the properties.
How to choose the right tenant? And the right rent?
What is the necessary paperwork?
How to protect themselves from fraud?
What if the tenant damages the property?
In this article, we will try to answer these and other relevant questions you might encounter while renting your property.
Let’s go.
Preparing the Property for Renting out
The initial impression of the property is a critical deciding factor for the prospective tenant.
Therefore, you must work on your property before you show it to prospective tenants. You must clean the property, paint it, and present it.
Besides this, photograph each room of your apartment with adequate lighting. The photographs should be high-quality and in portrait mode.
To take it a step further, creating a home tour video with proper narration and voiceover can be an appealing way to impress tenants. The video should be in landscape mode.
Create an appealing description for your home, as well as clear instructions and information. This description must include a home key feature, the type of tenants you are looking for, the size of the property, the location, the amenities available, and more. The owner must ensure that everything is written honestly and that the tenants have the appropriate expectations.
Marketing Mode: Online, Offline, or Both?
Once you are ready with photos and videos, it is time to plan marketing.
These days, you must plan your marketing using both online and offline channels.
Online
It can be posted online in a variety of locations, and there are numerous online resources available to assist you with this. Online listing of your home for rent allows you to reach a much wider range of tenants than offline.
Apart from free listing, you can also advertise online as well as take advantage of paid listing that offers higher visibility.
Offline
Moreover, you can spread the word offline. You can inform local property agents and advertise at prominent road intersections nearby and at the property itself.
Meeting Prospective Tenants
Once you start getting inquiries from prospective tenants, you must take the next step. This vital step should not be avoided to save time.
You must meet the prospects physically and have a detailed pre-screening process in place.
It is important to review rental history in earlier tenancy, litigation history, employment verification, and criminal background checks. Contact any reference given by them. You can also contact his housing society officials, neighbours, and office colleagues.
Instead of taking the trouble of doing all these yourself, you will find it easier to engage a tenant verification company.
In this phase ask some crucial questions to get deep insights about the prospective tenants.
Let us talk about some of the questions you may ask.
- What is the reason for moving?
This might be job changes, old home contract expiry, or the need for additional space. Try to find out if there is a history of dispute in his past landlord-tenant relationship.
- How long have you been living in your present home?
You can assume that anybody who is living in a house for quite some time is reliable as a tenant. Besides, such tenants are also perceived to have a good payment history, which is an advantage for landlords.
- How many family members will live here?
Landlords should ask about the number of people who will be residing with their prospective tenants and mention their names in the rent agreement. This will give you a fair idea of the tenant’s use of water, etc.
- What is your profession?
Landlords should check the financial situation of their prospective tenants by asking relevant questions. Ask to see some employment proof. Try to figure out his monthly income to make sure he can pay rent on time.
- When are you planning to shift?
If the tenant wants to move in immediately, it may be beneficial if the landlord is also looking to rent out his property soon. If not, then a landlord may have ample time to arrange for any repair and maintenance on the property.
Remember to Take These Precautions
However, before you hand over the keys, you must take certain precautions.
To avoid any future misunderstanding and dispute, have a well-written rental contract that signifies each party’s obligations and rights. This contract must be signed and sealed by a notary.
Familiarise yourself with all legal regulations regarding tenant screening in your community. Provide a copy of the rental agreement and the tenant’s background information to the society.
Always confirm their identity and financial information before accepting any kind of payment.
Do not forget to inform your local police station about your tenant with all relevant papers.
Always include the mode of compensation in the case of damage to the property.
Now that you know the essential steps to be taken before renting out a property, plan to invest in a property for stable rental income.
