So, you’ve just become a rental property owner in Anaheim. If you did everything right, you’re now on your way to earning passive incomes for generations to come. That said, owning a property is one thing, managing it is another. And how you do the latter can make all the difference in how it performs.
The following are a few things you should know about renting out your Anaheim rental house.
Know What is Expected of You
Under a typical lease agreement and landlord-tenant laws, being a landlord comes with a bevy of responsibilities. And they aren’t optional, needless to say. Besides the usual rent collection, the following are just some of the other responsibilities you’ll have:
- Abide by all tenancy laws, from security deposit rules to the Fair Housing rules
- Respect your tenant’s privacy
- Respond to maintenance requests promptly even when they are made at odd hours of the night
- Enforce the terms of the lease or rental agreement
- Treat tenants fairly on all matters
Prepare the Home for Occupation
Habitability laws require landlords to provide a livable home that meets all the basic safety and health codes. What’s more, making a home desirable ensures that it not only attracts the right tenants, but it also retains them.
The following are some tips to help you get your home ready to rent:
- Inspect the home thoroughly – Address all potential problem areas. Such areas may include burnt-out light bulbs, clogged gutters, leaky faucets or pipes, and roof leaks.
- Check safety feature – The responsibility of ensuring a tenant’s safety also falls on the landlord. Check to see that smoke and carbon monoxide detectors are in good condition and install a fire extinguisher in the kitchen and other areas of the home.
- Clean the home thoroughly – A dirty home is sure to turn any quality tenant off. Clean the blinds, windows, floors, and other areas as well. You may even want to shampoo the carpet to get rid of dirt and any odors.
- Evaluate the appliances – If you’ll be providing appliances, then ensure they are clean inside and out. Also, replace outdated ones with new and energy efficient ones.
Remember to hire professional services wherever possible to ensure that these tasks are done properly.
Protect Your Home with a Legally Binding Agreement
No matter how good a tenant may be, no one will care for your property more than you. That’s why it’s important to require prospective tenants to sign a lease agreement prior to moving in.
A good agreement helps set expectations, which helps minimize conflicts and misunderstandings. The following are some questions a good lease should answer:
- What is the dollar amount of rent and when does it fall due? Also, how long is the grace period and are there any late fee charges?
- Will you allow tenants to make property changes?
- What must a tenant do in order to get their security deposit refunded?
- How long is the lease term?
- What responsibilities does a tenant have in regards to maintenance?
- Will you allow tenants to keep pets in the rental property? If yes, are there any restrictions?
- Will you allow smoking in the rental premises?
- What may happen if a tenant breaks their lease agreement?
Determine the Rental Amount
This process is a delicate balancing act and one mistake can turn out to be costly to your bottom line. For instance, if you overprice the rental property, that can result in it being ignored by prospective tenants. However, if you underprice it, you’ll be missing out on passive income.
Now, there are a couple of ways in which you may be able to determine the right rental value. The first method is simple, find out what similar properties in the neighborhood are renting for.
The other method you can use is the 1% rule. This is an economic theory saying that the amount of rent you charge should fall somewhere between 0.8% and 1.1% of your home’s market value.
Lastly, you may want to consider hiring professional management services as they’ll be able to assess the market value of the property and advise you on the accurate rent price to charge.
Understand Tenancy Laws
In California, the following are a couple of landlord-tenant laws you’ll need to properly acquaint yourself with prior to renting out your home:
- Landlord entry rules – As a landlord in Anaheim, you’re prohibited from entering your tenant’s property as you like. Not only are you required to provide “reasonable” notice, but that the reason for the entry must be reasonable.
- Security deposit rules – California state law does limit the amount of security deposit a landlord can collect from their tenant. The limit ranges between the equivalent of one- or two months’ rent depending on whether the unit being rented out is furnished or not.
- Fair Housing laws – Landlords also have a legal responsibility to treat their tenants with respect and fairness in accordance to the Fair Housing Act. Protected classes include race, color, nationality, gender, disability, and familial status.
- Warranty of Habitability – As a landlord, you have a responsibility of ensuring your property is up to code in regards to health and safety.
Hire a Property Management Company
Being a landlord comes with many duties, that’s why many property owners choose to hire an experienced property management company to manage their rental units. Hiring one that offers a full-service property management service will ensure you achieve peace of mind and optimal ROI.
Being a landlord in Anaheim can be lucrative. However, you’ll need to put in time, money, and energy to make it happen. Alternatively, you can hire a reputable property management company to handle everything for you, from filling the vacancies to maintaining them to collecting rent.
Home Choice Property Management is a qualified property management service provider in Southern California. Get in touch with us today to learn more about our services!