Instead of selling a house after relocating to a different city, many homeowners are transforming their former homes into rental properties. Although it’s a great way to bring in extra income, managing a rental from a different city is not without its challenges.

Being an out-of-town landlord can come with a few hang-ups. For instance, it doesn’t allow you to easily respond to emergencies like you would if you lived close to your rental property.

That’s not to say you can’t successfully manage your rental from afar. Here are some tips to overcome the physical distance and make the process easier for yourself and your tenant.

1. Choose Trustworthy Tenants

Since you won’t be close enough to go to your rental at a moment’s notice, it’s extremely important that you trust your tenants.

When renting to someone you don’t know, make sure you thoroughly screen their rental background before allowing them to move in. Ask them to complete a rental application, and be sure to contact their references.

If possible, rent to family, friends, or referred tenants. This comes with its own risks, but at least you have a relationship with this person and the peace of mind of knowing that your property is in good hands.

2. Have a Handle on Maintenance

The type of property you’re leasing affects the amount of maintenance and attention you will need to put towards it. Apartments and condos have maintenance crews who take care of the outside walkways, grass, and parking lots, leaving you with less responsibilities (and worries) about the upkeep.

Maintenance for detached homes, or even duplexes or town homes, are the owner’s responsibility. If you are renting a detached home, you might want to hire someone to regularly attend to yard work and keep walkways clear and safe.

Alternatively, you can negotiate with your tenants and have them do the yard work themselves.

3. Ask Someone to Check in

Because apartments, condos, and basement suites are shared dwellings, any misbehavior by your tenant can theoretically be reported to the condo board or on-site property manager by neighbors.

A house offers more privacy, but also more room for mischief. For that reason, enlist someone you know in the area to be your eyes. That way, if there is a problem, such as vandalism, this person can let you know immediately, and even act as your property manager and check in if required.

4. Make Friends With Repair People

Maintenance, repairs, and other complaints all come to you as the landlord of a rental property. When you are out-of-town, you have to find other ways of dealing with these situations.

A handyman, electrician, and plumber are good people to have in your contact list. If there is ever a leak or electrical problem that needs to be fixed immediately, you can call on them to get the job done and bill you later.

5. Go Automated

Getting paid from tenants in another town or city can be tricky if you are used to dealing in cash or checks on the first of every month.

Set up payments so they are automated or have your tenants send you rent by way of email or wire transfer.

Another option is to collect post-dated checks from the tenant upfront that you cash on the first of every month. This option only works for fixed term leases, where the tenant has signed a one year or six month lease.

6. Set Strict Lease Terms

Your property, your rules. It’s best to be clear with your rental terms before the tenant moves in and make sure they understand what you will and won’t allow in your property. For instance, you might want to set up a zero tolerance policy on having pets or smoking in the suite in order to lessen the potential damage these permissions often cause.

Include these terms in your lease and ask your tenant to initial them as proof of agreement.

7. Communicate Often

Like long-distance romantic relationships, communication between long-distance landlords and tenants can be difficult, but workable.

As a landlord, it’s your job to establish regular communication with your tenants by phone, email, or text message and maintain this line of communication throughout their tenancy. Provide them with various contact methods, as well as additional contacts, such as your proxy landlord, and ask the same from them so you can contact each other in the event of an emergency.

If you plan to travel, or alternatively, if your tenant will be gone longer than 3 or 4 days, agree to tell each other so there are no surprises when you can’t get a hold of one another.

8. Inspect

As with any rental, near or far, inspections are a must. This means an initial walk-through inspection before the tenant moves in, as well as another when they move out.

Document the condition of each room in a rental inspection report and sign and date it.

Some landlords opt for regular inspections, especially if you are wary of the condition of the property for some reason (e.g. you’ve recently renovated or laid sod in the front yard). If you can make time to travel to your rental, then additional inspections can be reassuring.

Just make sure your tenant agrees, and they know in advance when to expect you.

9. Get Insurance Coverage

The type and amount of insurance you need will depend on the type of property you are renting.

There is insurance for:

  • Hazards, such as fires or sewer backup
  • Flood
  • Theft
  • Equipment breakdowns, such as furnace failure
  • Lost rental income
  • Liability insurance for damages, such as falls or slips on the property.

Ask your tenant to get renters insurance as well so their belongings are protected.

10. If All Else Fails, Hire a Property Manager

Managing a rental property from a distance and balancing other aspects of your life, including work, family, and friends, requires superb time management and a lot of patience.

Attending to your property can save you money, but it also costs you time in the process. Hiring a property management company to oversee your rental may increase your overhead, but it can also be the right option if you are not interested in managing the suite directly, dealing with tenants, or simply do not have the time to invest in caring for a property yourself.

Making Long-Distance Property Management Work For You

Supervising a rental property from a distance can be difficult, but it’s do-able. With trustworthy tenants, you might discover having an out-of-town property to be no more work than having an in-town one. Whatever the case, make it easy on yourself by being prepared for emergencies, maintaining regular communication with tenants, finding reliable repairmen, or opting for a property manager to supervise your property.

Posted by LawDepot

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5 Comments

  1. My parents have been considering getting an income property soon. So, I liked that you pointed out that it might be a good idea for them to hire a property manager to help them out. I know that they wouldn’t want to have to deal with finding people to rent the property and taking care of the property at the same time.

  2. Wonderful article. Lots of great information. Thanks..

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