There are two ways people become accidental landlords. Either they inherit a property with tenants in place or they're following the recent trend toward benefiting from low mortgage rates and high rentals.
Whichever category you fall into, there's a good chance you need a little guidance as you embark on this new chapter in your life.
Keep reading for the best advice on being an accidental landlord in Charleston, SC.
1. Accidental Landlords Need Insurance
If you're renting out your own home, you'll need to adjust your insurance accordingly. Homeowners insurance doesn't cover the risks involved in renting your home to a third party.
You must take out specialized landlord's insurance instead. This covers any damage caused by tenants on your property.
Some insurers may allow you to upgrade your existing homeowners' policy accordingly.
2. Set Up an Airtight Lease Agreement
A lease is the most important document related to being a landlord. It clearly outlines the landlord's expectations and provides some security for the tenant.
The South Carolina landlord-tenant law will help you answer things like:
- What are accidental landlords' duties?
- What are the grounds for eviction?
- How should landlords screen potential tenants?
Be sure you know the laws applicable to your neighborhood and get legal assistance with drawing up the lease.
3. Upgrade Your Home
Part of learning how to be a landlord is discovering how to get the maximum rent for your property. One of the best ways to attract high rentals and good tenants is by carrying out suitable upgrades.
Homes with excellent security, modern appliances, and energy-saving innovations are attractive prospects for potential tenants.
A property manager can advise you on the most cost-effective improvements to maximize your rental property.
4. Know Your Tax Situation
When you become a landlord, you'll receive extra income for your efforts, which means you'll need to pay taxes on that income.
Find a good accountant to help you figure out how much to set aside for the IRS. They can also advise you on any tax deductions applicable to rental properties.
Alternatively, invest in accounting software with tax functionality or hire a property manager to help with your books.
5. Get Professional Help
One of the best accidental landlord tips is to hire a property manager to help you in your new role. A property manager can assist you with the practical, legal, and financial aspects of managing a rental investment property.
Hiring a property manager means you won't need to invest any of your time into being a landlord. You can carry on with your daily life and still benefit from the passive income generated from your rental home.
Making the Most of Being an Accidental Landlord
Accidental landlords can thrive despite their unexpected new responsibilities. Following these tips for landlords is the first step in making the transition toward success as an investment property owner.
If you're overwhelmed by all the work involved in managing an investment property, help is at hand. Get in touch for assistance with all your property management needs in Charleston, SC.