If you've recently accepted a new job or promotion that will require you to move to another state, you may wonder whether renting out your home makes more sense than attempting to sell it and buy another while also adjusting to a new location and work responsibilities. Often, especially if you're not being offered assistance with relocation costs, it can make more financial sense to keep your home and use rental payments to cover the mortgage and related expenses, but managing a rental property from out-of-state can be a challenge. Read on to learn more about some of the factors you'll want to consider when renting out your home and moving away.
Tenant screening and lease agreements
Unless you already have a tenant in mind or plan to rent out your home to a friend or family member, you'll need to do some work to solicit and screen potential tenants. Choosing a problem tenant can not only risk damage to your home, but can cost you thousands of dollars in legal fees and other eviction-related expenditures if this tenant defaults on the rental agreement or falls behind on payments. Having a system in place to screen tenants for credit issues, criminal histories, and other signs that they may be unreliable can save you time and money, as can having an iron-clad lease agreement that preserves your property rights in the event of non-payment.
Another potential wrinkle for out-of-state landlords is the occasional maintenance or repairs your house will likely need while it's in rental service. Having tenants perform repairs themselves can be risky, as you won't have any way to see or inspect their work to ensure it's done correctly. In most cases, it can make sense to engage a maintenance contractor who will be able to schedule plumbing, appliance, and electrical repairs on your behalf.
Even the best screening mechanisms aren't foolproof, and at some point, you may find yourself needing to evict your tenants and re-rent your house. Because eviction proceedings can vary widely from state to state, you won't want to handle this with an attorney in your new state -- instead, you'll want to find a landlord/tenant attorney who is licensed in the same state in which the property is located.
Often, a full-service property management firm can perform each of these duties on your behalf, from finding tenants to collecting rent payments, scheduling maintenance and repairs, and even performing evictions. In exchange, you'll pay either a flat monthly rate or a percentage of the rent collected. For an out-of-state landlord, a property management firm like Choice Maintenance Group LLC can be an invaluable investment in your burgeoning rental real estate empire.Share