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Checklist: Before You Rent Out Your Property

There are many things to think about before you start renting out your property. You should consult your accountant about the many financial and tax implications. It would be a good idea to research whether your city or county has a department that governs landlord-tenant relations. Involving your attorney in your new venture is also a good idea. A smart property owner finds out in advance what laws apply to their rental properties.

In addition, it is a good idea to take a few minutes and think about how your rental property will affect the neighbors. That includes neighbors inside the building and in the neighborhood, particularly if you won't be living nearby. The following landlord checklist should help you think about preventing conflicts before they arise. For more information, check out our Rental Property Repairs and Maintenance section.

Preparing the Property

Before you start showing your rental unit to prospective tenants, it's a good idea to spruce up the condition of the property. You should conduct a thorough walkthrough of the premises well in advance. This is to ensure compliance with state laws on fair housing and get a head start on property management.

It would be helpful to have an inspection checklist to ensure everything in the property is in working order. On the outside of your unit, consider installing signs or devices that make it clear:

  • Soliciting on the property is prohibited.
  • Illegal activity on the property is prohibited.
  • Loitering on the property is prohibited.

A court, judge, jury, or other adverse party will take more kindly to a landlord who is responsible. Similarly, a prospective tenant will be happy to see the landlord has installed:

  • A security system and good outdoor lighting.
  • Working smoke detectors and carbon monoxide detectors
  • Fire extinguishers, light fixtures, and other safety devices

In addition, a smart landlord should make arrangements for:

  • Maintenance workers to have access to the property when necessary
  • The post office letter carrier to have a key to the property

There are many more steps you can take to prepare your rental property. Consider working with a trusted contractor to help you ensure the property is up to date with all local building safety codes. If the property is in good shape before a tenant's move-in day, you'll have less to worry about later.

What To Include in the Lease Agreement

A strong rental agreement is key to any healthy tenancy. Familiarize yourself with the local city, county, and state laws that govern your rental property. You will need to customize your lease agreement to accommodate local regulations. For example, some states might require lead paint or radon disclosures to be made inside or alongside the lease contract. Other states might limit the dollar amount of a tenant's security deposit in relation to the first month's rent.

Here is an example checklist of general things to include in your lease. Ideally, the lease:

  • Provides the timeline and mechanism for each month's rent payments
  • Designates which party is responsible for mowing the lawn, raking leaves, and other yard maintenance
  • Designates which party is responsible for shoveling snow and sanding/salting icy steps and walks
  • States the maximum number of people allowed to live in the rental property
  • Prohibits tenants from operating a business on the premises. This is especially important if the business would bring customers to the property.
  • Places responsibility on the tenant to repair appliances or devices. That includes the garbage disposal or HVAC system unless local law obligates the landlord to address such issues.

There are far more details that you can build into your rental agreement. You may want to address pet ownership, noise regulations, and renewal terms. You may also write in a requirement that the tenant must obtain renter's insurance. This will help protect you from liability in case of property theft, third-party injuries, or other accidents that could occur during a tenancy.

You should also include language in the lease that obligates the tenant to follow the law. While it may seem obvious that everyone should obey laws, imposing this requirement on your tenant can be helpful. For example, if a tenant breaks the law, your lease may empower you to proceed with eviction. This could be true even if the violation didn't cause property damage to the rental unit.

Preparing Tenants for Move In

You can take steps to prepare prospective tenants before they move in. You might even want to take some of these steps before you give new tenants a lease to sign. It is highly recommended that you obtain:

  • Detailed contact information about prospective renters, going beyond just a tenant's name
  • Background checks and credit checks for all adults who intend to be renters
  • Adverse credit report information, such as prior evictions, liens, judgments, or bankruptcies

Beyond routine application paperwork, it's also helpful to open up dialogue. To get to know your prospective tenants, consider starting a conversation with them to ensure they're a good fit. Remember, if you want that rental income to keep coming in, you must ensure the tenants won't break the law or destroy your property. In that spirit, it'll be a good idea for the conversation to cover topics indicating that:

  • Tenants have agreed to abide by local laws regarding noise, nuisance, and quiet enjoyment of surrounding property.
  • Tenants have agreed to abide by street parking regulations, such as the maximum time allotted for parking and regulations governing plowing or emergency clearance.
  • Tenants have agreed to abide by all other laws, including criminal laws prohibiting illegal behavior.
  • The landlord has prohibited tenants from keeping junk, such as broken-down cars, on the property.
  • The landlord has installed a bike stand for the tenants' use.
  • The rental property has sufficient designated space for parking, and tenants know to avoid parking in neighboring lots.
  • Tenants know to pick up after their dogs and not to allow dogs or cats in neighboring yards.
  • Tenants know to respect other neighbors and follow any applicable HOA rules, including CC&Rs.
  • Tenants have obtained the necessary moving day permits or authorization, such as a permit for a moving truck.

Finally, a move-in inspection is always a great idea for the landlord and the tenant. You can use photos and videos to document your walkthrough as you demonstrate the property's condition to your prospective tenant.

Later, if property damage is beyond normal wear, you will have proof that everything was in tip-top shape before the tenant's move-in date. Accordingly, when the tenant moves in, you'll have already secured your position through the above move-in checklist. When they move out, you'll know what problems were present before the lease and what issues your tenant may have caused during their tenancy.

Need Help With Your Lease? Contact a Lawyer

Real estate investors and first-time landlords might need more than just a tenant checklist to keep them going. Things like the terms of the lease, tenants' rights, and tenant screening aren't easy to navigate. Before sending out rental applications to potential tenants, review this checklist with a real estate attorney or landlord-tenant lawyer. They can give you invaluable legal advice that goes a long way in setting you up for a strong start.

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