renting a house

[Randy Cornelius]

So here I set at my computer early on a Sunday morning drinking coffee and reading LW

I know this is way off topic but I trust the advise of people here. I have this house that my mother left me when she died last March. It is a very nice house in a small town. I had an estate sale and have sold everything out of it so it is empty. I have had it on the market now since last June. We all know how the housing market is everywhere! It has been shown by the realator only twice since last June. Here is my question. I have had someone approach me about renting or leasing the house. I know nothing about being a land loard except I don't want to be one. As a deputy I have had my share of bad experances with doing evections ect from landloard / tennet issues. I am sure there are good experiances out there but I never hear of those. I know a good renter can make you money but a bad one can cost you.

But I have this house setting vacent and I could use the income to pay the taxes and insurance. Like I said it is a large, (2600 sq ft) very nice house in a small town south of Kansas City. My fear is that I will get someone that will tear it up or leave it a mess. I have to sell it some time to settle the estate. The rest of the hiers understand the situation and I am under no pressure to move it fast so renting seems an option but my luck I will get someone in there and then get an offer to sell. What would you you all do? Rent or keep trying to sell?

Thanks in advance.

Randy

[rdb]

It is much harder to sell a house with tenants. Sometimes it's very hard to get rid of them, even when they owe rent monies.

If you do rent out, try and find someone that will do work for rent reduction. You wont make as much money, but tenants who will do this take better care of the property.

A months rent in advance plus a month security deposit plus a lease (say six months) is standard, and filters out a lot of trouble.

I'm sure there will be more advice to follow. Good luck whatever your choices.

[Rawhide]

The best way to weed out a lot of potential bad clients is how you screen them. Fisrt, have an application fee. this should be the cost of running a background check (sheriff's dept.) and a credit check. Then have stipulations on the rental agreement i.e. no pets allowed...no more than 'x' number adults can live in the house. Income of tenants must be above 'xxx' per year, etc...

Then you can hire a property manager. the avg. cost is usually 10 percent of the rent. they handle all the calls, and dealings with the tenants. the managers only call you when property damage exceeds a threshold that you've set for notification. for instance, you tell the manager to call you when damage exceeds $50 dollars.

There are all kinds of stipulations you can put in a rental contract, just be mindful of discrimination laws.., you can't say things like no more tha 3 children, or something like that...check this with the state the house is located in. Check the age of the house as well, if it's older than 1976, you'll have to disclose lead based paint.

Good luck.

[HorsehairBraider]

We had to rent our house when we moved here (it was that, or pay two mortgages) and we had our real estate agent act as our property manager. It was in her best interest that the house sell, and she was willing to do it, so it worked out in our case.

We had three different renters in there, and they were all OK. We charged first and last month, and a security deposit to be returned once they were gone and the house was inspected.

The real estate agent told us when she showed the house to prospective renters, she paid attention to things like their car, clothes and general demeanor - like, was the car full of old trash etc. She told them she could only rent to them with our approval, and so we were able to screen potential renters quite well that way. (That's not something we put in the contract - it was just how we went about it.)

We explained that the house was for sale, and that when it was shown, they would have to clean the house and then be elsewhere while it was shown. Since everyone knew that ahead of time we had no problems that way.

My first renter was a single man and was fabulous. He was neat as a pin and cleaned everything to within an inch of its life. The second was a couple, and they were great but got a divorce and left in the middle of the night! That was OK, I had their $1,000.00 security deposit and their last month's rent - so remember that little story and don't neglect to collect those fees! For those people, I had to change the locks because they still had the keys, so that security deposit came in handy. The last couple were sort of losers, but they were clean and decent and that was all we wanted out of them. They left no problem when the house sold, and left it very nice (although I then hired someone to come and clean it professionally, for the new owners).

So it can work out if you are careful and professional in your approach. Having a third party handle it is really nice, it keeps everything on a business level where it should be, and away from the emotional appeal stuff - "we lost our job", "the kids are sick" etc. Good luck!

[Johanna]

When Wade and I married, we each had a house, but mine has a two-story barn (all men eye that barn enviously) and it's bigger, so we live here. For the first couple of years we rented his house to his sister, and that was fine except for the midnight maint. calls and assorted expenses landlords have to pay. We rent it to a family friend now, and he takes care of all the things sister used to call us for, so all is well...but...if he fell off the edge of the earth, that house would become a financial liability quickly, and it is not going to be an easy sell despite a prime location. (We do not have first & last & a security deposit, nor do we much in the house fund, period) We are looking into refinancing to get locked into lower mortgage rates right now, but it is worrisome, because Wade's company just instituted pay cuts and benefit reductions, and laid off a good percentage of the work force. Our area's economy isn't good right now, and even when they reduced his pay, Wade said, "I'm lucky to have a job." My warning is that even if the house is paid for and unoccupied, it will still generate expenses, like utilities and taxes, so if you plan to sit on it for awhile, make sure you get good tenants you can trust, and establish a fund to cover exploded water heaters and other unforeseeable costs.

Johanna

[BradB]

So here I set at my computer early on a Sunday morning drinking coffee and reading LW

I know this is way off topic but I trust the advise of people here. I have this house that my mother left me when she died last March. It is a very nice house in a small town. I had an estate sale and have sold everything out of it so it is empty. I have had it on the market now since last June. We all know how the housing market is everywhere! It has been shown by the realator only twice since last June. Here is my question. I have had someone approach me about renting or leasing the house. I know nothing about being a land loard except I don't want to be one. As a deputy I have had my share of bad experances with doing evections ect from landloard / tennet issues. I am sure there are good experiances out there but I never hear of those. I know a good renter can make you money but a bad one can cost you.

But I have this house setting vacent and I could use the income to pay the taxes and insurance. Like I said it is a large, (2600 sq ft) very nice house in a small town south of Kansas City. My fear is that I will get someone that will tear it up or leave it a mess. I have to sell it some time to settle the estate. The rest of the hiers understand the situation and I am under no pressure to move it fast so renting seems an option but my luck I will get someone in there and then get an offer to sell. What would you you all do? Rent or keep trying to sell?

Thanks in advance.

Randy

I have a friend who is a Realtor, she has 7 rental properties and she uses a property management company to take care of the renting, inspecting etc. She has a few times driven by the property and seen something she does not like and calls them and tells them to get new renters ( she is very very particular about her properties). So you may want to think about something like that if it is available.

Edited January 11, 2009 by BradB