Running a property rental business is a great business move if done right. For many property owners, especially in the township, having rental properties is another way of generating consistent tax free income.
After many years of working, many opt the option of taking up building loans or a second bond to expand their property investment. Retired pensioners and former employees choose to use their retirement or pensions funds to build and tap into the property business. A great way of generating monthly income long after one is no longer formally employed.
A great business idea that guarantees consistent income on a monthly basis. Not to mention the potential great return on investment should one decide to sell their property in future.
What happens when the property is continuously vacant? A rental property business cannot operate if there are no tenants to occupy the property. That is where the biggest downfall or loss for any landlord can be.
Property owners or landlords generally depend on monthly rental income to make a living. A single month of not receiving such income could result in the property loan repayments being in arrears, as well as other general monthly needs not being fulfilled.
As a landlord, having more tenants moving out than in can be rather costly, stressful and affect your livelihood. Generally, any tenant who pays rent wants to be happy, comfortable and free in the place they are renting. If certain requirements are not met, they are more than likely to search for better accommodation and move out.
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In the experience of many tenants, a lot of landlords tend to ignore the needs and basic requirements of their tenants. This usually results in tenants moving from one place to another. We will highlight a few concerns to assist the landlord in making better and more well informed decisions when renting out their properties.
The monthly rental amount a landlord charges should not only be based on the size or looks of the room. Higher than usual amounts usually chase away the potential tenant, especially in the township. In business we not only sell looks but also an experience. If a there is more to offer then a tenant is likely to stay. Take into consideration what more you can offer the tenant than just accommodation. Competition is high and there are many options available.
Many landlords charge security deposit not taking into account what it is really meant for. And in many cases equivalent to first months rent. When charging a deposit amount, a landlord should also consider the possibilities of what costs they may have to cover should a tenant move out. For example, in a simple plain garage renting for R1500 per month. How much damage to property could possibly need attention when the tenant moves out? Most commonly paint, globe replacement and maybe door handle replacement. Which in many cases would not be equivalent to rent.
If a rental property does not have lockable gates, fairly high walls, burglar bars and other security measures then it is most likely a target to criminals. Safety should be a top priority. And if a property is not clean,it generally attracts rodents and cockroaches among other species and germs associated with unclean spaces. Health is also a top priority that should not be compromised.
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For different reasons some people prefer to have or not to have pets in their space. But for someone who intends on sharing their space with others then those people should also be considered. Take for example having dogs on the premises while one of the tenants is afraid of them. That puts the tenant in an uncomfortable position which is likely to chase them away. Pets are okay to keep in a space you are not sharing with others who are not your immediate family.
Having children is natural thing and therefore almost impossible to avoid. It is better to implement rules for all children in the yard and which must be followed accordingly. You could rather have a maximum allowed number of children allowed rather than No Children at all.
Every house should have rules to abide by in order to maintain order. But when the rules become too severe to handle, it often makes living with them unbearable. Some of which include (a) No visitors allowed (b) Tenants not being granted keys for the gate (c) Curfew (d) Specific political or religious beliefs (e) Sweeping and maintenance of the yard (f) Introduction of a new partner/spouse.
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• Implementation of new rules while tenants are already staying in the premises also chases tenants away. Be straight forward from the onset.
• Allowing your children to act your behalf. You are the landlord and your children should respect the tenants regardless of age or social standing.
• You should be hands on and communicate all changes with your tenants prior to implementation.
• Have a considerate date for payment of rent to avoid having quarrels with tenants.
• Be friendly and kind but avoid making friends with your tenants.
• Do not borrow money or food items from tenants.
• Be transparent about your traditions and beliefs. Some people’s beliefs may be the complete opposite of yours.
• Tenants bathroom and toilet should not be used by landlord or family members.
• Have a thoroughly detailed lease agreement in place.
By Tebogo Thamaga for Bathamaga Property
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1 Comments
Great advice indeed
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