What to Consider Before Renting Out a Home

Using your home as a rental property may help you achieve greater financial security or flexibility. However, there are many items that you need to keep in mind before deciding to allow someone else to live in your home as a tenant. 

You'll Have to Follow Fair Housing Rules

It is illegal to refuse to rent to someone because of that person's gender, national origin or sexual orientation. It is also illegal to refuse to rent to someone who is pregnant, has a child or who has a disability. In some cases, you may be required to modify your home to make it easier for a disabled person to use. 

Tenants Have Legal Rights After Signing a Lease

While you can enter your home after renting it to a tenant, you must give that person notice before doing so. Tenants also have the right to ask you to make repairs or take other steps to ensure that the property is suitable to live in. For instance, you might be required to replace a defective toilet or pay an exterminator to get rid of mice in the home. 

Evicting a tenant is not as simple as asking that person to leave. You must generally provide advance notice of an eviction as well as describe the reason why that individual is being asked to leave. You may be required to provide an opportunity to rectify the issue that has led to the eviction. 

For example, if the tenant hasn't paid the rent for the last two months, he or she may be given three or five days to do so. If the tenant refuses to leave of his or her own accord, the sheriff will need to compel that person to leave on your behalf.

You Must Provide a Safe Dwelling Space

If a tenant slips on an icy walkway, you could be liable for paying any medical bills or other financial damages that he or she incurs. The same could be true if that person trips on a torn carpet or is otherwise injured because of dangerous conditions in the home. Generally speaking, you must take care of any hazardous conditions that you know about or should have known about. 

Rent Is Typically Considered Income

It is a good idea to talk to an accountant or a tax attorney prior to renting your home. He or she may be able to talk more about how to account for rental income on your tax return. The cost of repairs or upgrades made to the portion of your home that has been made available for rent can typically be deducted.

Ideally, you will talk with a realtor or other real estate professional to learn more about the potential pros and cons of being a landlord. This may make it easier to decide if renting out your home is truly in your best interest.


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