It may not be a bad idea. As the Washington Post reports, many area residents are already getting phone calls from friends looking to crash, and Craigs List has condos and homes going for literally thousands of dollars for just a few days. If you’re thinking of renting your home or a room, here are some tips to keep in mind:
– You’re entering into a lease — treat it that way. Spend the money to buy a legal lease either online, at an office supply store, or bum one off a real estate agent friend (check that it’s legal for your jurisdiction). If something does go wrong, you won’t regret having a legally enforceable agreement that dictates things like move in/move out times, damage to property, and the like.
– Remember you’re bound by fair housing laws when you advertise and when you choose a tenant. Focus on the property and its features, and not on the type of tenant you’re looking for.
– Protect your property condition. Charge a security deposit. (Consider an extra deposit if they are bringing pets). Complete a move in exam with your tenant, and complete another one as soon as they vacate. Make sure everything is in writing. Take lots of photos prior to them moving in, and then take photos of anything you think was damaged. If you won’t allow pets or smoking, specify that in your written agreement. Same with parties.
– Have your tenants complete an application. Consider running a credit report on your tenant (you need to get their permission). You can find an online service, like this one, to help with this. (Update 11/16: The Post article has a good suggestion – consider using Paypal, or even just require the tenant to provide full payment in advance to make sure the check clears, so you don’t have to worry about credit report. I’d argue, though, that a credit report gives you a good indication of the level of respect the person will give your property.)
– If you are currently a tenant yourself, make sure your lease allows for sublets. If not, you will be responsible for any and all damages your ‘guests’ do, and may be subject to other penalties.
– Charge a non-refundable deposit, and make sure the check clears (if you are accepting checks). Consider requiring a cashiers check or money order.
– Keep in mind the potential tax consequences. Most of the time you needn’t worry, but consult your accountant.
– There are certainly insurance implications to consider as well. What if your tenant/guest gets hurt in your home? What if they leave the stove on and cause a fire? Your homeowners insurance may have a clause that will void your coverage if you engage in a for-profit rental — check with them, and be sure you understand the risks!
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Update 11/15: The Post just had a good article with some tips on renting out your place too.
Update 12/7: Here’s the next trend in inauguration housing – Travel someplace cool on the cheap by swapping for the week. People are certainly more likely to take good care of your home if they know you are in theirs!
Discussion: Are you renting your place out? What rents are you looking to charge, and if you’ve successfully found a renter, how much and what terms did you negotiate? Post your thoughts and experiences in the comments section below!
Update 12/12: More resources from About.com
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