Many investors buy property in the U.S. and then rent out their homes to earn a steady rental income.
However, due to different circumstances and policies, how do you rent out your property for profit and management after buying a property in the US?
There are two ways to rent out your property, you can manage it yourself or let a professional rental company manage it. The former is suitable for investors who live in the U.S. for a long time; the latter is more suitable for investors who do not live in the U.S. for a long time.
If the owner lives in the U.S. for a long time, he or she can get the rent by renting and managing the property himself or herself.
The rent should be set according to the market, and the price should not be too high, otherwise the empty house is also a waste. There is no house in the U.S. that cannot be rented out, and as long as the rent is reasonable, it can usually be rented out within a month.
Choosing a tenant depends not only on the tenant's credit but also on the stability of the tenant's job. Because the investor is in the U.S., the rent can be collected in a timely manner and the tenant can be notified in the first instance if there is a breach of contract so that disputes can be handled in a timely manner.
If you choose to manage the property yourself, although you can save some costs, you must clearly understand the terms of the U.S. real estate lease, and the housing lease law requires the landlord to provide the tenant with a fixed local address so that they can contact you at any time if they have any questions.
The tenant must also be provided with an emergency telephone number to call in case they need help.
Landlords need to be aware of changes in local rents and take immediate legal action if a tenant does not pay their rent on time.
Not only do these requirements take a lot of time and effort for overseas investors, but it makes more sense to have a professional housing management company manage and rent the home.
If the landlord is unable to live in the U.S. for an extended period of time, this can be done through a property management company.
What does a housing management company do?
Advertise and find tenants for your home, draft the lease, confirm rent and responsibilities of all parties, perform credit checks, rental history checks, employment income checks, and criminal record checks on tenants to ensure the landlord's interests.
Rent is to be collected and transferred to the landlord's account each month, and regular housing inspections are to be conducted and reported to the overseas landlord via email or phone.
At the end of the lease contract, closing and checking out, and re-advertising the property and finding a new tenant.
What is the process of entrusting a housing agency?
The landlord and broker sign a delegated lease agreement. The broker posts the lease and helps the investor find a suitable tenant.
Among all the applications submitted by the tenants, the most suitable one is selected and the lease agreement is signed to complete the lease details.
What are the fees?
After a tenant is found and a lease is signed, the commission for commissioning a lease is generally 6%-8% of the annual rent, depending on the actual situation.
Housing management fees are typically 5%-10% of the monthly rent. The management company will require the rent to be paid monthly and the security deposit to be paid for 1-2 months.
It is also important to note that the homeowner is required to pay for the restoration of the interior and exterior of the home such as the required attorney's fees for evictions, and the management company is only responsible for enforcement.
For usual repairs, if the homeowner is not in the U.S., the management company can be responsible for getting a quote from a repairman and the homeowner can decide before starting the repairs.
