Rent out your properties and get tenants to pay your housing loan?

Written on 3:38 AM by Yuen Lung

 

One of my friend just brought a brand new town house. The developer manage to deliver the property on time. Now is under the property inspection and acceptance phase. She is so lucky that there is already potential tenant approach her for rent. She is so excited as there is people (the tenant) help her to pay her housing loan installment every month. Which release her from cash out big portion of her monthly salary income for other usage instead of installment.

As this is the first time become landlord, she is exciting and bit nervous (I can feel it :P). As a friend of her I shared my landlord experience with her. Oh dear, suddenly I realised that I haven't document down the knowledge I have!

I think I better write it down somewhere:

  1. Tenancy Agreement is a must.
  2. Take photo of every valuable in the property and get tenant's initial on it.
  3. Indicate the renewal / move out notice period if the tenant decide to stay after the agreed period or move out before the contract matured.
  4. Give rewards (such as 20% discount on last month rental, TV set, etc) for tenants who pay rental punctually (or pay rental in advance)
  5. Note down the electricity and water meter reading and get tenant to acknowledge and initial it.
  6. Open a bank account which is easily accessible by tenant to bank in rental. The bank account number should be stated in the tenancy agreement.
  7. Indicate clearly when do you expect the rental to be banked in and the penalty if you do not receive the money by the agreed date.
  8. Tenant must fax you or pass you the bank-in slips, electricity and water bill receipt periodically (let's say 3 months).
  9. Note down the name, IC number, telephone number in the tenancy agreement. Any additional people who want to stay in the property must notify you before moving in.
  10. Protect the properties by insurance.
  11. Pay visit to your property regularly when it is just rented. You may cut down the frequency after few months, if your tenants could take care of your property and you have more confident with them.
  12. Understand the cost of maintaining the property. You estimation should cover not only the mortgage installment but also the taxes, repair cost and agent fees, etc.

There are lot more issue to take note to become an effective land lord and get your property help you pay off your mortgage. The more you know the more you enjoy to be a land lord. :)

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2 Comments

  1. Erica Smith | April 23, 2009 at 3:27 AM

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