Are you new to being a landlord? Many people find themselves in this role when they decide to rent out a home that they once lived in. Or, perhaps you’ve inherited a property and you don’t want to sell it just yet.
You’re in a good position. Renting out a property that you already own can bring you regular monthly rental income. It can also set you up for a lot of wealth in the future. Your asset is going to appreciate in value while you build equity and your tenants pay down any mortgage and contribute to expenses.
Here are some of the most important things that you don’t want to lose sight of as you begin your new endeavor as a landlord.
This Property is No Longer Your Home. It’s Your Business.
If you’ve lived in this home and created memories there, renting it out and detaching emotionally isn’t always easy. You can’t pop in unannounced and you don’t want to become too friendly with your tenants.
You’re running a business, and all of your decisions have to be made based on what’s good for the business. Real estate is fairly emotional, especially for new landlords. Make sure you can set the necessary boundaries and treat your property like the income-producing business it is.
San Diego Maintenance Must be Preventative
Maybe you’ve had a window that locks funny but it never really bothered you. Or a couple of kitchen drawers that stick. It’s time to fix all those things and make the property rent-ready.
All of those minor issues that you noticed but didn’t fix while you lived in the home yourself will now need to be taken care of. Before you put it on the rental market, you’ll need to conduct a thorough inspection and take care of all repairs - no matter how major or minor they might be.
You’ll also have to continue maintaining the home. Emergency maintenance issues are expensive and stressful. You’ll want to avoid those by taking a preventative approach to maintenance and by making small fixes while you can.
This will require resources for things like HVAC inspections and service, plumbers, electricians, roofers, and other calls to vendors and contractors. If you don’t think you’ll be able or willing to put some money aside every month for potential maintenance, renting out your property probably isn’t a great idea.
Not only do you need the funds to pay for these repairs, you also need good relationships with vendors who are reliable, licensed, insured, and affordable. When tenants call with a problem, you’ll have to respond quickly, especially if it’s a habitability issue.
By focusing on preventative maintenance and a good team of vendors, you can save money on maintenance costs and keep your property well-maintained.
California’s Rental Laws are Complex
The legal landscape is challenging, especially in California. When you’re renting out a San Diego property, you have to be compliant with all state, federal, and local laws. If you don’t know the rent control laws, the just cause eviction requirements, and the regulations that cover security deposits, Section 8 screenings, and service or support animals, you could find yourself making an expensive legal mistake.
California fair housing laws are actually stricter than the federal laws. Your lease agreement needs to include specific language that addresses rent control and whether it applies to your property.
Recovering from a legal misstep will be expensive. If you want to rent out your home, you’ll need to educate yourself on the current laws and commit to staying updated on all the changes.
Surround Yourself with Experts
Be willing to listen to people who can help. San Diego property managers, for example, can play a big role in helping you succeed. Instead of trying to figure everything out on your own, don’t be afraid to ask for help. You can leverage years of experience, a keen understanding of the local rental market, and a vast network of contractors and vendors.
We know these things can seem overwhelming. And these are just a few of the things you need to consider. Our team would love to help you lease, manage, and maintain your San Diego rental property. Please contact us at Mercer Properties.