Renting out your Winston-Salem home could be one of the best decisions you'll ever make. Besides diversifying your investment portfolio, you may be able to generate a recurring monthly rental income.
Becoming a landlord, however, isn't always easy and stress-free. It requires a certain level of skill and experience to do it successfully.
In this post, we are offering 6 tips on how to rent out your house in Winston-Salem, North Carolina.
1. Have a Proper Insurance
A homeowner's insurance policy won't be sufficient now that you're looking to rent out your home. There is some degree of responsibility that comes with having people live in your home.
Without insurance, if, for instance, a tree falls on your rental home and causes damages, you would have to finance the repairs on your own. Not to mention, if it injures the tenant, you can be liable.
That's why taking out the proper insurance is key. Landlord's insurance combines both property and liability insurance together. The property portion covers any structural damage that may occur to the property. The liability portion covers you against losses that may arise from legal costs or medical bills that you may be found liable for.
2. Know How Much Rent to Charge your Tenants
Before listing your property, it's important to sit down and do the math. Begin by making a list of all expenses associated with renting out a home. Examples of common expenses include utilities, property taxes, and mortgage payments (if any).
Also, account for any repair or maintenance expenses you may have while the tenant lives in your home!
Next, figure out the monthly profit. The sum of your expenses and profit should give you the gross monthly rental income. Look at how much comparable properties in the neighborhood are charging. This should give you an idea of how competitive your rate is relative to other landlords.
3. Carry Out Important Property Upgrades
As a landlord, it's important to ensure that your home is rent-ready. At the very minimum, the home should be able to adhere to the NC health, safety and building codes.
Your goal should be to make your property as desirable to prospective tenants as possible. This can involve doing a number of tasks, such as cleaning, repainting the walls and replacing any outdated appliances.
4. Get the Required Permit
Many municipalities now require landlords to have a permit in order to rent out their properties. The requirements tend to vary from one municipality to another. Therefore, make sure to do due diligence to see what your city requires.
Generally, the purpose of the permit is health- and safety-oriented. A local government inspector will inspect your home to ensure the home meets the basic habitability standards.
The inspector will then write up a report of their findings. If necessary, they will let you know of any changes, repairs or modifications that you may need to do in order for the property to comply.
The permits themselves aren't expensive, but they are necessary when renting out a house.
5. Understand the Landlord-Tenant Laws
Before you start looking for tenants, you need to familiarize yourself with the landlord-tenant laws.
Under these rental laws, one that you must know is the Fair Housing Act. The Fair Housing Act prohibits discrimination against tenants based on their protected characteristics.
In North Carolina, the protected characteristics include race, color, disability, marital status, religion, and sexual orientation. As a landlord, you must abide by this law when advertising your rental, screening tenants, and even during the day-to-day interactions with your renters.
You must also understand the entry laws. Did you also know that you cannot barge in on your tenants as you like? If you do so repeatedly, your tenant could sue you for harassment. In North Carolina, you don't need to provide your tenants with a notice before entering. However, many landlords still give their tenants a reasonable advance notice prior to entering out of respect.
Additionally, you'll need to understand all the eviction laws and process! You'll need to follow the proper judicial process when evicting a tenant. Regardless of the violation a tenant commits, you cannot lock out the tenant, remove their belongings, or shut down utilities. If you do so, not only would the eviction fail, but you may find yourself in legal trouble.
6. Hire a Property Management Company
To maximize your rental income, you'll need to treat your investment property as a business. You'll want to fill your rental with the best quality tenants, maintain it to the best standards, consistently collect rent, and build a great landlord-tenant relationship.
Without the requisite skills, however, that may be difficult. Luckily, you can hire a reputable property management company to handle everything for you.
A good manager will handle all the paperwork, collect rent, communicate with tenants, assist with legal issues, and more!
TE Johnson & Sons can be your perfect partner in North Carolina!
Renting out your Winston-Salem home can be lucrative, but only if it's done right.
As an overview, if you aren't sure where to start, consider the following:
- Have a proper insurance
- Know how much rent to charge your tenants
- Carry out important property upgrades
- Get the required permit
- Understand the landlord-tenant laws
If all this seems too overwhelming, or if you lack the necessary skills and experience, hire a professional property management company. At TE Johnson & Sons, we will help you minimize risks and maximize your ROI!