Renting out a property can be a great way to generate passive income, but it takes work to ensure your property is rented out to responsible tenants at the right price. Here are the steps to take to prepare your property and find a suitable tenant:
- Determine the rental rate: Conduct a market analysis to determine the appropriate rental rate for your property. Consider factors such as location, size, and condition of the property, as well as local market conditions. Additionally, if you plan on upgrading the property or making improvements to the building, you should take that into account when setting the rental rate.
- Prepare the property: Make sure the property is in good condition before showing it to potential tenants. This may include repairs, cleaning, and cosmetic improvements. If the property is currently occupied and an existing tenant is planning to relocate, advertise the building, amenities, and existing layout with a 2D plan.
- Advertise the property: List the property for rent on online real estate marketplaces, such as Loopnet, Crexi, Costar, Craigslist, and Buildout. Additionally, place signage on the property to increase visibility.
- Show the property: Schedule tours of the property for potential tenants. Be prepared to answer questions about the property and the lease terms.
- Screen tenants: Verify the financial qualifications and creditworthiness of potential tenants. Review the profit and loss statement of the tenant's business, business tax returns, owner net worth, and credit profile.
- Execute the lease: Once you have found a suitable tenant, have them execute the lease agreement. Review the lease carefully with the tenant and address any questions or concerns before it is signed. Consider hiring a lawyer to assist with the lease agreement.
- Maintain the property: Keep the property in good condition and address any issues or repairs that may arise during the lease term. Regular maintenance can help to prevent major repairs down the line and keep your tenants happy.
By following these steps, you can ensure that your property is rented out at the right price to responsible tenants. Remember, finding the right tenant is key to a successful rental property investment.
