Get Your Property Rental-Ready: A Step-by-Step Lease Checklist!
Are you about to become a first-time landlord and feeling a bit anxious? Don't worry; it's completely normal to have some apprehension. Both landlords and tenants experience stress during the moving process. As a new landlord, it's crucial to familiarize yourself with all the legalities involved in leasing a home. To help you through this journey, we have prepared a first-time landlord checklist with all the essential things you need to remember.
Being a landlord can be a secure and rewarding investment with numerous advantages. You can earn passive income and build wealth for your retirement.
Below, you'll find a comprehensive list of everything you should know before renting out a home for the first time. We've also included solutions to common property management questions to assist you in making the most of your new venture.
Inspections and Safety Measures
Your tenant's safety should always be your top priority. Conduct regular property inspections to ensure everything is in order. Additionally, familiarize yourself with the safety regulations applicable in your city.
For example, in Hamilton Ontario, it's mandatory to have working smoke alarms on every floor of the property. Rooms with fuel-burning equipment, like the kitchen, must have carbon monoxide detectors installed.
Here's a safety checklist to ensure your property is safe and livable:
- Check the building's infrastructure, including walls, roofs, stairs, and floors.
- Inspect communal facilities like stairwells and hallways.
- Examine elevators, plumbing, electrical, ventilation, and HVAC systems.
- Verify the proper functioning of heating systems that use hot water.
- Ensure there are no rodent or vermin infestations.
- If your property is older, check for environmental hazards like lead or asbestos.
Complete All Necessary Repairs
If you come across any issues during the property inspection, it's essential to address them promptly. Fix any out-of-code items, such as plumbing problems. Additionally, ensure that smaller elements like cupboards, windows, doors, and lighting operate flawlessly.
Managing property maintenance can be challenging, but it's vital to take care of it before prospective tenants view the property. Replace broken door locks or window hinges, and ensure all utilities are operational before the tenant moves in. Keeping a rental property maintenance checklist can help you stay on top of these requirements.
Comprehensive Lease Agreement
Creating a well-structured lease agreement is the next step once you've found a suitable tenant. The lease agreement should include:
- Names of all parties involved (landlord, tenant, and co-signers).
- Duration of the agreement.
- Rent amount and payment schedule.
- Security deposit and additional charge conditions.
- Rules against unlawful activities and disruptive behaviour.
- Agreement for property upkeep.
- Responsibility for property damage and the right to own (or not own) pets.
- Conditions for tenancy, including subleasing.
Another critical aspect of the lease agreement is the entry rights. Clearly outline when and under what circumstances you, as the landlord, are permitted to enter the property. For instance, landlords may enter the tenant's residence to make repairs or carry out maintenance.
Once you have drafted the lease agreement, it's essential to have it reviewed by a lawyer or legal professional. Go over it carefully with the tenant to ensure both parties are in agreement with its terms. Once everything is satisfactory, have the lease signed and dated.
First and Last Month's Rent
Congratulations on becoming a first-time landlord! As a best practice, always collect the security deposit and the first month's rent before the tenant moves in.
However, there might be some exceptions to this rule. For example, if your tenant receives government assistance, they may pay after the scheduled move-in date. Familiarize yourself with any exemptions provided by real estate law in your area.
When it comes to rent collection, it's essential to sort out payment options with your tenants. Whether it's direct deposit, PayPal, checks, or physical currency, make sure both parties are clear about the preferred method.
Change the Locks
As a precautionary measure for your tenant's safety and to protect your property from potential legal issues, it's advisable to change the locks after the previous tenants have moved out.
The Move-in Confirmation Checklist
When your new tenant finally moves in, take the time to review the move-in checklist together. This checklist describes the condition of the rental unit and serves as evidence of its livability. It becomes essential in the event of any disputes regarding deposit deductions after the tenancy.
The move-in checklist should include:
- Tenant's name, address, and apartment number.
- Start date and expiration date of the lease.
- Outcomes of the move-in and move-out inspections.
- The condition of each room in the apartment at the time of entry and exit.
- Confirmation of operational safety equipment, such as smoke alarms.
Both you and the tenant should sign the move-in checklist. This will help you track the property's condition over time.
Consider Property Management
If managing the property becomes overwhelming, consider professional property management services. Whether you own multiple units or investment properties in the Greater Hamilton Area, we offer hassle-free, expert management services at affordable rates. From finding trustworthy tenants to handling maintenance, our qualified property managers have years of real estate expertise and will make your property a valuable investment.