What to do before renting your property
Have you ever thought about renting your home? In addition to generating extra income, it can be a rewarding experience for you and the people you are renting it to. Here's what you need to know before putting your property on the rental market.
Get rental property insurance
First, get rental property insurance. This insurance is similar to a typical homeowner policy, but some of the coverages might differ. This is why it’s important to contact your insurance company to check if your property is eligible, and to see what coverages are available to you depending on your situation.
Find the right tenants
Next, figure out what kind of tenants you’re looking for. You can either search for tenants on your own or with the help of a real estate agent. Their services include pricing, advertising, showing, screening and paperwork. The cost usually adds up to about 1 month’s rent.
It can be a good alternative if you have little time to devote to tenant search. Finding good tenants requires a lot of time and effort, and this is where a real estate agent can help streamline the process and avoid pitfalls. Whether or not you decide to use the services of a professional, always remember to do a credit check and ask for references so you don’t get trapped with unreliable tenants.
You should also consult a lawyer or notary to help you draft a lease agreement you feel comfortable with. Some details you don’t want to forget are: how many people can occupy the rental, what insurance is required on their part, who is responsible for paying for utilities and the consequences for not meeting obligations. The more detailed and clear it is, the less likely you are to run into issues with your tenants.
Have your home inspected
Another important thing to do before the tenants move in is to have your home inspected. Since structural problems and cosmetic issues crop up in all buildings over time,. you should check your home thoroughly. In some cases, hiring an inspector to assess the state of your house and flag urgent repairs may be a good way to avoid any problems. Plus, a major cleaning and a fresh coat of paint will also do wonders for your relationship with your new tenants!
Renting your home is about meeting new people and using it to generate a profit. Unlike selling, it's a long-term commitment, but it can be a great experience from both a personal and a financial standpoint!
Further reading
The Personal refers to The Personal General Insurance Inc. in Quebec and The Personal Insurance Company in all other provinces and territories of Canada.
The information provided is meant to be illustrative only and does not constitute or replace the advice of experts. The Personal assumes no liability with regards to how such information is used