Did you know it is estimated that there are around 43.3 million homes for rent in the US? As a result, many property owners realize that renting out their property is a great way to get a recurring income. But do you know how to get started?
Unfortunately, it is not as easy as you might think. Read on as we discuss the steps to transform your home into a rental property.
Why Transform Your Home Into a Rental Property?
This comes down to one factor, and that is a regular income from the rental itself. This can be used to go into savings, supplement your lifestyle or even pay off the mortgage. In addition, as the property appreciates, you stand to make a lot of money in the long term.
Start by Checking All the Permits
Having the right permits for rental properties is essential, as you don’t want to fall on the wrong side of the law. Many municipalities will have their own guidelines on this, so check them thoroughly. In addition, it may be worth speaking to a local property attorney regarding this.
Check Your HOA
If you are part of a homeowners association (HOA), they may have their own rules and regulations regarding rentals. Check in the documentation you got when buying the property, or speak with the members who run the association. This article may help you work out what you need to know about HOAs.
Make sure you are filing the correct taxes from your home rental. Filing late or incorrectly can result in major penalties and fines.
Check the Mortgage
Your mortgage will contain an occupancy clause, which states it is your primary place of residence. This entitles you to lower interest rates and smaller down payments. However, if the bank finds out you are not living at the property and renting it out, they could cause problems, so check the legalities before going ahead.
Determine How You Will Manage the Property
Owning rental properties is very rewarding, but it is a lot of hard work. In fact, it is often easier if you have a lot of them and can do it full time instead of balancing them with a job. If you don’t want the hassle, consider hiring home rental companies to do it for you.
Check the property to see if any major renovations are required and budget accordingly. This article on surviving a bathroom remodel can give you guidelines on one of the most tackled rooms in the home.
House and Landlord Insurance
Finally, protect yourself with the necessary insurance. Accidents are bound to happen, and you need to protect the home and yourself as the landlord.
Now you know the steps to transform your home into a rental property, you can begin earning extra income. Cover yourself legally, do your research, and make some renovations.
If you are thinking of buying, selling, or renting in the Salt Lake City area, Market Source Real Estate should be your first stop.
We even offer relocation services if you are new to the area. So contact us today and let us help you find your dream home.