So, maybe you’ve found your first investment property and are looking to rent it out. It can be overwhelming knowing where to start when it feels like there’s so much you need to do. So, here’s a quick guide of what’s important as a first-time landlord in order to:
- find tenants
- maintain your rental, and
- have a great renting experience.
Keep in mind that this is just a brief guide and a more detailed one can be found at TenancyServices.
Make sure your property is up to standard.
- No one is going to want to rent a property that is grotty and run down, plus there are several standards that a rental is legally required to meet. Check out the Healthy Homes standards and the Residential Tenancies Act to ensure your home meets these. Small hint: Insulation and heating are two recently revised standards.
Establish your restrictions.
- A rental property is an investment and you have the right (to an extent) to restrict who you have occupying it and/or how they behave when they are living there. You need to be careful that you aren’t unfairly discriminating against a potential tenant, but you are allowed to set terms in your agreement. Small hint: No smoking or no pets are two terms you are allowed to include. For more read this article.
- As a starting point MBIE has templates for landlords to create tenancy agreements. Using the MBIE templates ensures you keep up with the latest requirements.
- Additional clauses can be added to agreements as long as they dont contract out of the Residential Tenancy Act. See here for Terms to include in your tenancy agreement.
- Landlord tools can also be used which pre populate tenancy agreements and make it easy for landlords to complete the Tenancy Agreement paperwork.
- Getting insurance for your property is highly recommended. In the event that your property is hit by a natural disaster or even a disaster tenant, insurance will protect you and your property.
Advertise your property
- The faster you get your property on the market, the faster you’re going to find a tenant. Keep in mind that the better the advertisement and the bigger the portals that you advertise on, the more applications and inquiries you are going to get. Below are some articles that can help you gain maximum exposure when advertising your property:
- Should I list my property on Trade Me or Facebook?
- What makes the perfect online advertisement?
Check potential tenants
- Once you’ve got people interested in your property, you’re going to want to find out a little bit about them so that you can decide if they’re a good fit for your property. During the application process, you should ask their written permission to conduct a background and credit check, as well as asking for some references that you can call. Once you have these it is important to follow up on them. Below are some articles to help you once you get to this stage.
- Why should I check references?
- What should I ask when checking references?
- The best place to credit check my tenants
Sign the paperwork and keep records
- Make sure your tenants sign everything that they need to and that you do the same. Keeping a record of agreements and paperwork is essential since you never know when you might need to pull it out to refer to something. It is also wise to track rent payments and take note when rent is not paid. These sorts of records can be useful in the event that something goest to Tribunal or if your tenant requests records for their own peace of mind. One rookie mistake you want to avoid is not inspecting the property before a new lease begins. Even if tenants have been amazing during the entire renting experience, it is always advised that you inspect the house before signing off on the bond refund paperwork. This is important to avoid finding damages that you will then be liable to pay for. Since much of this information is confidential, it is also up to you to ensure that it is kept safely, so that no one other than yourself has access to it.
- Making sure that your tenants are looking after your rental is hugely important, and it’s better to find out sooner rather than later if they aren’t. Keep in mind that you have to give between 14 days to 48 hours’ notice before an inspection, and you can only inspect once in a 4-week period. For an idea of what you should be looking for at your next inspection, see this article.
- If you make it difficult for your tenants to contact you, you are less likely to hear about things that need to be fixed or any general problems the tenant has. At the same time, if you can’t get in contact with your tenant it’s going to be very difficult to inform them of things like inspections and repairs.
- As time passes, and your property gets older and becomes less modern, it’s worth keeping on top of things to ensure that everything is functioning as it should. If you look after your property, you are more likely to find tenants who will do the same.
- Between tenants, it is also recommended that you check the property for traces of meth. If you don’t check this between tenants, and then discover it further down the line, you’re going to have the almost impossible task of discovering which tenant was responsible.
There is a lot to know when it comes to renting. Whether you’re new to the game or not, renting regulations are always changing and landlords are constantly needing to stay informed about this. For a more thorough list of what you should be doing as a landlord, please refer to the tenancy website and please, take those steps outlined in the article above.