We have recently seen increased activity in the rental sector due to an uncertain real estate market, fluctuating interest rates and declining home prices. More people are deciding to rent their homes to tenants because their property value has dropped, and selling would result in a loss. Those with cash cushions and investors are scooping up bargain properties to either renovate and flip or rent, and many people are continuing to rent simply because of the market’s instability. For whatever reason—or combination of reasons—we are seeing growth in the rental sector.
As a tenant or renter, you have rights, but many people don’t know exactly what these are. Granted, the property you occupy is not legally yours, but you do have certain protections and privileges that should be guarded while you’re living there. Ensure they are protected by knowing what you’re entitled to before you put your name on the official lease documents.
Know the property owner’s financial situation.
You would assume someone owning and renting a piece of property would be in a sound financial situation, but this is not always the case. You want to avoid moving into a home only to turn around and move back out because the owner loses the property to foreclosure.
Do your research around the neighborhood.
Don’t presume, because a property looks sturdy and safe and is seemingly well maintained, that the community and neighborhood are right for you. Drive around; stop at a local restaurant for a meal; and seek out property management companies in the area that can tell you the ups and downs. Especially if you have children or want specific neighborhood amenities—like access to public transportation or a park—you will want to know as much as possible about the community.
Ask what is entailed in the tenant screening process, if one exists.
This can differ among landlords and property management companies, but many people perform tenant screenings before handing over the keys. This process can include pulling your employment history, pay stubs, rental history, background check, credit check and more. Most of the time, people just want the security of knowing you are stable, can pay the rent and don’t have a criminal background. To protect your privacy, however, ask questions and know what to expect.
Know positively that your landlord is adequately insured.
Just as you carry car insurance to protect against injury to yourself and other motorists, landlords should do the same—protect themselves, as well as their tenants, by having adequate insurance. If your landlord only has homeowner’s insurance, what does it cover? Commonly, an addition or special rental insurance is required.
For added protection, look into getting a renter’s insurance policy. It gives you an extra level of security and should your possessions be lost or damaged during your lease period, you will feel safer having added insurance.
Ask about lease termination and lease period flexibility
The future is unpredictable, and most of us sign a lease believing we will remain in the home for the duration of the stipulated lease period. However, if something comes up, is it possible to get out of it? Is month to month an option? What if I lose my job? How much is the termination fee? Answers to these questions are good to know simply as a point of education and foresight.
If you are currently a tenant or are looking to sign a new lease, you will want to be as knowledgeable, protected and secure as possible. If you don’t know exactly what your rights are in a tenant landlord situation, seek out a third party for counsel—ideally a reputable, experienced property management company that will have experience managing rental and lease relationships.
Call Boundless Management today at 866-331-6626.