Converting your California home into a rental property can prove to be a lucrative decision. You can gain consistent rent earnings and save up the income. If you have current debt or find that your expenses are increasing, this is a wonderful alternate source of money.
Though there are numerous benefits, renting out a property requires careful planning and consideration. It isn’t as easy as simply advertising your property, welcoming a tenant, and collecting the rent consistently. A lot of responsibilities are involved in managing a rental unit.
If you are thinking about converting your home into a rental property, Archer Management Group has put together a list of considerations. Here are things to think about before taking the plunge to ensure you’re prepared:
1. Consider the responsibility it takes.
A landlord juggles several tasks, and this requires a ton of free time. Ask yourself if you’re ready to give up a huge portion of your time. Even if it’s advantageous financially to have a rental to pay for the maintenance of your California home, the responsibility you’ll carry can be heavy.
Sometimes, operating a rental increases your stress when problems arise. A tenant may complain about a property issue. Aside from that, you need to deal with the expected maintenance and repair. Your other responsibilities will include collecting the rent and performing preventive maintenance to reduce costly problems. You need to confront property damage to ensure your tenants remain happy and stay for a long time.
2. Ensure your home is prepared.
To keep up with competition from other rental homes, you need to whip your California rental property into shape. If there are similar rentals within your neighborhood, you can differentiate yourself by presenting a space that’s immaculately clean with functional appliances and HVAC systems.
Test the security systems. Conduct a walkthrough. The rental space must look attractive with no clutter for property showings. Prospects must be impressed to increase the odds of filling out the vacancy. Pay attention to curb appeal and landscaping. Minimize the opportunity for intruders to enter your home. Add motion detectors and more lighting in dim areas. Safety is a priority for all tenants.
3. Study marketing strategies and implement them.
Create a list of the features of your California rental home. Most renters prioritize amenities such as a parking area, ample storage space, outdoor areas, and modern appliances. If your property has these features, make it your selling point. Mention the well-known brands, describe the quality materials, and use specific descriptions.
Once you’ve gathered the vital information on what makes your rental stand out, you can start advertising. Craft a well-made property listing and post on various online platforms. Share quality pictures and videos. Enlist the help of real estate agents and reward them with a commission. Inform your network that you have a property vacancy. The greater the exposure, the better it is.
If you want faster occupancy, hire a property management company that has vast resources. At a small cost, you can enjoy the benefits of sitting back and waiting for your next tenants. Property management companies have a sizable network and can find new tenants quickly. They also have excellent marketing skills to attract prospects. Moreover, they have a professional staff that can efficiently market your home better than you can on your own.
4. Learn how to screen tenants meticulously.
You can’t simply welcome any interested prospects in your California rental place. You need to check their rental background. Aside from verifying the identity since some can have criminal records, you need to assess the income as well. You don’t want to worry about being unable to collect the monthly dues. This requires you to evaluate the applicant’s credit score and search for an eviction record.
Check if the potential renter can keep the rental property well-maintained. You can find out this information by calling up the references. Patterns of behavior can be repetitive. If the renter has a good rental track record, then it’s expected that rent payment in your own rental will be consistent, too. If the prospect passes the evaluation period, you can now collect a security deposit.
Be sure your screening process adheres strictly to California’s Fair Housing laws to avoid legal consequences.
Laws and Legislations
Under California law, security deposits are different depending on if the unit is unfurnished or not and whether the potential renter is an active-duty serviceman or not. The security deposit typically ranges from 2 to 3 months.
When a tenant moves out of your California rental home, you must be able to return the security deposit within 21 days. If a tenant has unpaid rent or caused property damages such as broken the window, then the repair cost can be deducted from the security deposit. Damages because of normal wear and tear are exempted from any deductions.
Landlords oversee making the rental unit habitable so proper maintenance of the home must be practiced. You must fix leaks and clean up the gutter spout. It’s also part of your duty to have the heating and air conditioning systems inspected now and then to ensure it’s working properly. Otherwise, tenants can withhold their rental payment. Landlords are given a maximum of 30 days to deal with maintenance concerns.
Tenants can also request pre-inspection before their leases expire. They might want to be more aware of the property damages so they can focus on fixing them. If all issues are addressed, then the entirety of their security deposit can be refunded.
Knowing the California landlord-tenant laws is useful to avoid tenant conflict. You’ll also feel confident that you’re adhering to the existing laws. It will make you more aware of your rights as a landlord and the duties you’re expected to deliver.
Self-managing your California rental home can easily lead to burnout if you’re juggling other demanding roles in your life. By hiring a reputable property management company, you can manage your different tasks and live a balanced life. A property management team can help reduce your rental operation stresses. At the same time, they also focus on the growth of your California rental property.
Contact the team at Archer Management Group to discover how we can help you on your journey to a successful rental property!