Roofable

Renting Tips

With the Buyer’s market we’re currently working through, there are many homeowners who can’t sell their houses and for one reason or another are forced to become landlords.

I have had two rental properties in East Orlando for about five years (by choice). The other day a friend called me and asked for some tips on how to rent his house. Although I’m not a pro, I have been doing this for five years without a management company and was able to give him some tips on where to advertise and how to interview prospective tenants.

This post is for the average homeowner, who doesn’t know a lick about renting their house and is trying to avoid the cost of a management company. By the way, I have nothing against management companies. I would probably use one but I need to save as much money as possible because the rent to mortgage ratio is so tight.

This is what I do…

Figuring out Rent and Security Deposit

1. I figure out what I’m going to charge for rent by getting on my computer and researching what others are asking in the local area. A few sites you can visit are Hotpads.com, CraigsList.com, and Rentals.com. My favorite site by far is Rentals.com (this use to be Rentclicks.com, for those of you in the know).

2. When researching your asking price make sure to compare your property with others that are the same square footage in the same local area…not just the same number of bedrooms and bathrooms.

3. I make the Security Deposit the same as one month’s rent. I don’t negotiate that…the full amount is due at the signing of the lease…no exceptions.

4. East Orlando has proven to be a good rental market so far with the amount of new people moving in and UCF right down the street. Don’t be desperate. Stick to your guns and the right person/people will come. That said, don’t set your expectations so high that no one is interested either.

5. College students…the big debate…should you or shouldn’t you rent to them. I would say that I would prefer a family with two responsible adults. But I have also had very good experience with college roommates. For example, I have rented one of my properties to three young men who were engineering majors that were quiet, responsible, long distance runners (meaning they don’t smoke) and ready to jump into the “real world” soon. They were great! If you are a decent judge of character I’m sure you can tell when college students are party-ers and when they are not.

Advertising

1. I primarily advertise on Rentals.com. It’s been my experience that the site receives more traffic than any of the other rental sites. I’ve advertised on Craig’sList before, too, but only received a few phone calls from that…it’s free, though, so it won’t hurt to try.

2. I usually buy the highest spot on Rentals.com because my listing will stay on the first page for the whole month. I don’t want my listing to get bumped to the second page because it’s less likely to get viewers. I’ve never had to advertise for more than one month.

3. Buy a sign and put it up in a very visible spot in front of your yard. Rentals.com will send you a free sign if you list with them.

4. Keep your phone very handy and answer your emails and voice messages when you receive inquiries from potential tenants. Remember…nothing is a sure thing until you’ve signed the lease and received the security deposit!!!

5. I’ve found that I get the most amount of calls about 2 weeks before I’m ready to rent. If you start advertising 4 weeks before you need to have it rented don’t be surprised if people really start calling around the 2 week mark.

Showing the House and Screening Prospective Tenants

1. I like to keep my rentals looking like I’m trying to sell. You want to attract the right kind of people. You want people who are neat and clean and appreciate a house that’s neat and clean. If your house (or you, for that matter) give the impression that you don’t give a rip about the place then the tenant won’t either.

2. When I first started renting properties I found a company that will do my residential screening (i.e. run a background check, credit check, rental verification, employment verification and criminal history). The company I use is called MCC Group. There are probably many others but that’s who I’ve used and have been happy with.

3. My first method of screening is from the credit check. Don’t expect super high credit…that’s probably one of the reasons their renting and not buying. However, you can get a pretty good view into their financial habits. If I still like them after the credit check then I proceed to the rental history and employment history and criminal background checks.

4. MCC Group will provide you with an application and release form (for them to run the screens). It’s very easy, just add your name and address and various prices, print it out and hand it out to people.

5. If you’d prefer to do your own screening I HIGHLY recommend the book, “The Landlord’s Book of Forms and Agreements” by Cliff Roberson. It’s copy written in 2006. The great thing about this book is that it has a CD with all the forms included so you can just download them to your computer. I’ve used the book more than once for anything from a pet addendum to a notice of bounced check. Get it!

After They Move In

Treat your tenants well and they will likely treat you well. I’ve yet to have a tenant who dislikes me (even those who I’ve had to confront on various issues). That’s because I treat them like they are partners with me in maintaining this property. I realize that there are horror stories and I hope I’m never one of them, but I firmly believe that it’s best to treat others as you would want to be treated. Be firm but fair.

Hopefully, I’ve helped shed some light on your new adventure…or I’ve made a great case for management companies. Either way, I hope this helps.

I’m sure many of our readers have a lot of experience in the renting process. If you have any good ideas for novice landlords please feel free to add them in the comment section below. I’d be happy to learn from you, too.