Renting a home instead of selling the home, even in a buyers market, may look like a great way to generate extra income. Some Canadian homeowners are well suited to the task and rent out primary and secondary homes. However, there are challenges that can arise when renting out a property and a discussion with a financial planner may help one ascertain whether it is worthwhile to try to rent according to applicable housing laws and restrictions. Understand more about what it takes to successfully rent a home today.
Canadian Landlord Obligations
Those looking to rent a home for the first time may want to decide whether they want to perform maintenance themselves or hire a property manager. It may be more cost-effective but more time-consuming when a homeowner chooses to maintain and perform responsibilities for a single property. As a new landlord, one will need to collect rent, ensure the safety of the home or apartment and any major appliances. It is up to the landlord as to which utilities may be covered in the rent. Landlords generally cannot enter the home unannounced, but must inform tenants of their intention to do so ahead of time. Landlords renting for some time can increase the rent charged but are obligated to provide current tenants with 90-day notice.
It is important for landlords to understand applicable rental and tenant laws as they can vary by territory or province. Those thinking of renting out a condominium may want to review the Canada Mortgage and Housing Corporation Provincial and Territorial Fact Sheets. More resources are also available for those renting in Alberta, Manitoba, New Brunswick and British Columbia. Tenants have certain rights and it is important for any new landlord to become acquainted with them to avoid potential liability.
Tenants, in addition to paying rent, have to help maintain the property. They should regularly clean the home, contact a landlord when repairs are required, and make regular rent payments. Tenants should give written notice when intending to move out. The laws governing the area will dictate how much notice should be provided to the landlord. A tenant who has signed a lease and is looking to leave early may have to pay extra money to the landlord to do so.
Screening Process for Potential Tenants
Homeowners who become landlords may know little about the necessity of screening potential candidates. There are many issues that may occur and while the screening process will not guarantee a perfect tenant, it may help a property owner avoid picking one with poor credit or a history of not paying bills on time. A homeowner can ask for references and check into the applicant's credit history, finding out more about their employment history and ability to afford rental payments.
After a potential tenant is found, it is worthwhile for the party to sign a lease agreement. The document will touch on any specific rules and any restrictions that apply to recovering the rental deposit. Landlords and tenants are protected with lease agreements that clarify rules, processes and general expectations.
Restrictions on Renting Homes
A person thinking about renting out their home or property needs to know about any associated restrictions. Some may find that they are not allowed to rent out their vacation home or condo. Such information can generally be found in the rules or bylaws from a governing agency or the HOA, and provided when the home was purchased. A person deciding to rent a property that goes against these rules may find themselves with legal repercussions or considerable fines.
Renting As an Investment
Some Bayview homeowners benefit from the income generated from renting without much of a headache. However, not everyone is as lucky. Canadian property owners thinking about renting may want to understand more of the costs and responsibilities associated with becoming a landlord.