Renting a house or a room is a great business opportunity for many homeowners. Millions of people take this advantage to get some extra cash, as there is a huge profit margin in this field. The only thing that one needs to keep in mind that this business has quite high maintenance cost.
There are many benefits of renting out a house, some of which are:
1. A steady income: Many landlords buy a house in such areas that gives a constant flow of tenants.
2. Rent can be greater than mortgage value: The property value can be lower sometimes, but the house rent can be much higher, depends on the area, transportation facilities, nearest market facilities and also for the security the place provides. Moreover, the rent of the house can increase in value in time, for which the property owner will gain assets admiration along with the steady rental revenue.
3. More than an apartment: Many people take a house as a rented house generally, like by a family, by some professionals, or by some students.
Other than these benefits, there are so many responsibilities and challenges that an owner should keep in mind while renting out a house. The responsibilities are:
1. Before giving a house for rent, the owner should take care of things like plumbing, wiring, outdoor areas, functions of appliances, safety of staircase and lifts.
2. Setting a competitive price: The owner should know about the rental cost of what the other house owners or property holders are offering along with the other facilities. A tenant always roams around for good deals, so a high price must be backed with a quality place to live.
3. Screen the tenants: It is a problem to find out a good tenant. The house owner should choose the tenant very carefully. The owner needs to keep his look on the behavior of the tenants regarding the maintenance of the house. In addition, it is needed to make the tenant agree to pay the rent on the time.
There are some other tips that one should know before renting:
1. The owner should make the tenant feel at home. If the tenant is good and the owner wants them to stick on the tenancy, it is the owner's duty to provide some service, to look after the tenant's problems, or to do whatever needed and benefits the tenants to make them to stick for a longer time.
2. The owner should also allocate a secure parking space for tenants.
3. It is better to arrange for the cable/telephone or Internet connection before giving the house for rent, so that the tenant can get all the important stuffs. These facilities can help the owner to rent the house and to avoid the tenants to make any changes to the house, like drilling a wall etc.
4. The most important thing to consider is the insurance of the house. The house owner should ensure that the rented place is well insured before renting it.
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You may own two houses. One you use as the primary residence. You can transfer the ownership of the other house to someone else through a quit claim deed. Or else, you can use you second house as an investment property. For investing purpose, you can rent out your second home. You can use the income that you receive from renting your home out to pay off your mortgages. This way you can generate equity in your second home from the payments made by the tenants. You have to be however well aware of the tenant laws in your state. In some states, these tenant laws are very much biased in favor of the tenants.
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