Leasing your Home
Have you ever thought about renting out your house? With housing prices soaring to record numbers, many Sydneysiders are entering the more flexible residential lease market. One of the most common reasons why people decide to put up their homes for lease is to capitalise on investment. In fact, leasing a home might have been their plan all along.
Why else would homeowners want to turn their home into a rental property? To some, they find that t they can just lease their home and use the income to buy a new house. On the other hand, there are others who are better off renting out their homes for the meantime. This is likely because they have difficulties selling but need to relocate as soon as possible.
How Much Can I Rent My House For?
The success of rental properties are based on return on investment. Factors that must be considered when establishing rental fees include the size of the property, facilities and demand in the area. The location of your home and its proximity to public transport, shops and restaurants greatly influences the final price as well.
Whether you are a potential lessor or a long-time landlord, you need to be well informed of how to maximise financial gain. These cover opportunities you need to take advantage of and risks that you need to take into account.
Managing the Property
Before putting up your house for lease, you have to be prepared for the many responsibilities it involves before, during and after your property is rented out. Securing a property condition report prior to leasing is a good first step.
Before making your home available for tenancy, be clear on when and how renters can settle the payment. Also, in some circumstances, homeowners can screen tenants to properly sift through the candidates and pick the one who will best honour the rental agreement.
Once you finally have your home rented out, it’s ideal to perform routine inspections. For maintenance and repair issues that could come up, aim to attend to them right away. You also have to anticipate complaints and respond accordingly.
A Guide to Screening Tenants
In your home rental lease agreement, you can choose to indicate the maximum number of occupants, subject to the Fair Housing Amendments Act of 1988. You may also impose a rule on pets for people renting out your home. Explicitly state which types of pets you can allow to live with your tenants. Alternatively, make it clear if you want your home to be an animal-free zone. Other aspects your background check can cover include:
- Credit Scores
- Current Income
- Employers (present and previous)
- Former Landlords
- Monthly Debt Obligations
- Personal References
- Police Checks
Costs of Renting Out A House
It is highly recommended to take out a landlord insurance. First, figure out how comprehensive you want your plan to be. When reviewing insurance as someone leasing a house, consider building repairs, acts of nature and other forms of rental income loss.
Aside from insurance, there are other types of costs that you might incur. These could include and is not limited to the following:
- Body corporate fees (for apartment owners)
- Council rates
- Home Improvements
- Interest and other bank fees
- Land tax
- Maintenance and repair
- Water bills
Legal Exemptions and Obligations
The additional costs of maintaining an investment property may seem overwhelming. Fortunately, you are eligible for tax deductions. In fact, there are quite a lot of tax deductible expenses granted to landlords. These could be anything from travel for the purpose of property inspections, maintenance or even rent collection. You may also claim a deduction for expenses incurred on:
- Advertising for tenants
- Borrowing expenses
- Gardening and lawn mowing
- General Cleaning
- Pest management and extermination
To know more about other expenses that you can claim prior to a tenancy, contact Trevor Leslie Real Estate. We provide guidance on how to rent out a house for prospective lessors, regardless of the type of property. Call 02 9686 7999 now for any questions you might have.