There are a lot of people in Panama City Beach that purchase a condominium in order to rent it out. The thought of being your own landlord is an appealing financial venture but there’s more to just collecting a check every month. Here are five aspects that all potential landlords and homeowners should know before getting into the property rental business.
#1. This is not a short adventure.
If you’re buying property for rental investments considered a long-term investment. It can take time for the property to appreciate in value and build equity. Renting out your property each month can bring the cash flow income that you are looking for as long as you find the right property. But, you are in it for the long-haul so remember that when looking for a property.
#2. Consider all the costs.
Simply buying the property will not be your only cost. If you live in Panama City Beach you may want to manage the property yourself but if you don’t, you may want to seek out a property management company to handle all of the rental screening, tenant issues, rent collection, and repairs or replacements. You could be looking at upwards of 10% of the rent each month for a property management company, but, if you are out of the state or city, this can be well worth it.
#3. Get a checklist.
Make sure you know all items to go over when a tenant moves in and then again when they move out. This is a great list from Immoafrica.net on checking what needs to be done or in working order:
- Check that the stove is in working order.
- Check all lights and electrical points.
- Ensure the geyser is working correctly.
- Check for any leaks or damp that needs waterproofing.
- Check that the gutters are unclogged and clear of debris.
#4. Complete a contract.
Don’t miss anything on the contract so that everyone is covered in case of default. Have stipulations in place if things change or if rent is not paid. This usually prevents misunderstandings and miscommunication. Damage costs, replacements, a method of payment, etc.. are all things that need to be verified.
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#5. Tenant Selection.
If you have a property manager, they will do all the screening for you, which is a nice perk! Find a manager that is well versed in selecting great tenants and talk to their clients to find out if the tenant selection has been successful. Get details from previous rental history, why they are moving, employment, income, etc…
Ready to find the best rental property for your needs? Give us a call! We’d love to talk to you about your budget, your cash-flow requirements and what would be the best option for a rental condo in Panama City Beach.