What You Should Know Before Renting Out Your Property
When property owners understand crucial details about renting out property, they may be able to avoid expensive leasing errors.
Many people in Tucson and across the state invest in real estate and then rent their properties out as an additional source of income. In some cases, people may want to rent their home out for a time while they make a long distance move. Whatever the case may be, leasing property can have significant tax benefits and give the owner flexibility when it comes to parting with their property. There is, however, certain risks that owners take when renting their homes, condos or townhouses out to others. By fully understanding what these risks are, people may be able to avoid making a critical and costly mistake in the future.
Be picky when choosing tenants
Property owners should be extremely conscientious when choosing tenants to live in their home. The wrong person could destroy the property, fail to pay rent and could leave the owner with extensive repair costs once they leave. It is always a good idea to run a criminal background check and credit report when screening potential residents. Owners should require candidates to provide references, and then follow up on those references.
Create a lease agreement
A comprehensive lease agreement is absolutely essential when renting out a home, according to US News. In the agreement, the owner should create terms regarding how they would like rent paid, when it is due as well as the consequences if it is not paid. The lease agreement can also contain specific terms, such as whether pets are allowed, if the tenant is allowed to smoke on the property and how many people can occupy the property at any given time. Owners should make sure to put who is responsible for insuring the property, paying utilities and keeping up the landscaping.
Know the real estate laws
There are a lot of documents, forms, tax records and other important papers that property owners must keep organized. Some owners may decide to enlist the help of an accountant, who is familiar with all of the real estate laws and rental tax laws that apply to people who lease out their property. Some landlords may also choose to hire property managers that will look after the rental and ensure everything is up to date.
Looking after your rights
A real estate attorney in Arizona may be essential to landlords who are renting out property. Whether you need to create a case against a tenant, or you would simply like someone to look over your rental agreement, you may want to seek the assistance of a lawyer.