Renting a house is common these days. If you have a real estate property that’s vacant, renting can be the most suitable option to consider. It will also ensure an additional income source. However, prior to renting your home, there are a few things that need to be contemplated. 

Let’s have a look at the top 5 things to focus at:  

Identifying The Right Tenant

This is the most crucial step to consider. You must do a deep background check of the tenant (you have shortlisted) before finalizing the deal. Conducting police verification is recommended since it will help you in understanding whether the person being shortlisted has any criminal background or not. You will have to submit the tenant’s id proof documents to the local police authority to proceed with the background check.   

Obtaining Emergency Contact Details From The Tenant

Another crucial is to focus on! Once you finalize someone to be your tenant, make sure you obtain necessary contact details for emergency situations. The tenant may be a working professional, relocated to your city. The tenant may be a student. Whatever may be, make sure you obtain the necessary phone numbers of people whom to contact in case of an emergency situation related to the tenant.  

The Rent Agreement

The agreement papers must be properly creating. Drafting the rental agreement papers needs to be done carefully and in the presence of a legal professional. 

The most common points that the agreement should cover are listed below:  

• Both the name of the landlord and the tenant needs to be mentioned. Same goes with the address and guardian’s name. The details being conveyed by the tenant must match the identity proof being provided by him/her.  
• In the case of PGs in Bangalore, multiple tenants will be involved. In such cases, names and other details must be mentioned under the respective heads. This goes under the joint rental scheme.  
• The agreement must clearly mention the rent (along with the breakup structure, if any). Say, for example, if the rent includes maintenance fees, electricity charges, and other fees, it must be clearly mentioned in the space. In the case of PGs, the rents mostly include everything like electricity, maintenance, food, etc. In case of additional fees (exclusive of rent), it must also be mentioned in the agreement.  
• Next in line is the payment mode for the rent. It should be clearly mentioned in the agreement as to which of the payment modes for paying the rent are allowed. Also, the last date to pay the rent every month must be mentioned. If there is a late fee, do mention it clearly in details.  
• The tenancy period must be mentioned in the agreement. There should be a date of expiry for the tenancy. If the tenant wants to continue with the rent, he/she must renew the agreement for an additional period (or as proposed). 
• The total security amount to be charged from the tenant must be mentioned. Also, it is mandatory to mention the refund scenarios of the amount, the adjustments to be made, and everything related to the agreement. Any damage made to the property during the tenancy period will have to be settled by the tenant. The penalty charges (for the damage caused to the property) will be deducted from the security amount.  
• There should be a clause mentioning reasons that may lead to premature rent termination. The withdrawal can be from either of the sides. 
• There should be clear mentioning of the facilities available for the tenant upon rental. It can be the use of electricity, common passage, garage, lawn, terrace, or whatever. 
• Finally, the agreement must feature clear mentioning of the purpose for which the property is being rented. If the purpose is residential, the property cannot be rented for commercial schemes like business centers, study center, restaurant, etc. In fact, commercial rental schemes involve different types of legal procedures and tax implications.  

Calculating The Rental Amount

How much should be the rental amount? Before renting your property, this is what you need to decide carefully. 

Do your part of research to gain a clear understanding of the present market rates in regards to property rentals. Do keep in mind, the real estate market is extremely competitive. Unless you place a suitable rate for your property, it may become difficult to get any tenant. However, you can charge a premium if the house is fully furnished, well maintained, located in the top locality, and has good demand in the market. 

The Registration Part  

Once the agreement for rent is prepared, it becomes necessary to get it signed from both the ends – the tenant as well as the landlord. The signing should be done before two witnesses (definitely trustworthy ones). 

Once the signing process is done, you, as the landlord, must focus on the registration part. Is it necessary to register a rental agreement? The agreement for rent must be registered as per legal proceedings. Visit the office of the registrar and get the registration proceedings carried out.  

Finally, it is a common practice to ask for rent payment in advance from the tenant. Before the tenant shifts into your property, ask him/her to pay the security deposit along with first month’s rent. Security deposits are usually two months’ rental amount (in most cases). 

Conclusion

Your house is an important asset. Make sure to keep it well maintained. You need to evaluate its worth and valuation properly. At the same time, when looking for a tenant, verify the options coming your way. Always act through legal proceedings to avoid any kind of misdeeds and irrational situations. 

Also, before renting your property, you need to get it repaired and renovated to make it look new and perfectly apt. A nice looking property with clean and well-maintained interior (as well exterior) always attracts a bigger client base. Also, you need to ensure that the basic facilities like 24 hours water, electricity, and security are available for the tenant who will take the house on rent.