When you’re fortunate enough to own your own property, it’s easy to get mired in the negatives – one of which can often be the expensive mortgage repayment prices. In a more practical sense, you might also feel as though this is something that restricts you from leaving your home for any prolonged period of time.
A solution that you might resort to, then, could be to think about renting out your property. There are two main ways that you might think about doing this, and each comes with its own kind of considerations.
As a Landlord
Of course, whichever option you ultimately choose, you’re going to have to solve the problem of where you’re going to live in the meantime. If you’re traveling, then that matter might be taken care of, but if whatever direction you choose becomes a more permanent fixture, you might need another home to call your own while you’re renting out this one.
Whatever you choose, you might feel as though the most consistent option is to simply become a landlord. If you have a tenant living in your property who’s contracted for twelve months (for example), it can be a comfort to know that you’re not going to have to immediately worry about who you’re going to get in after them. There’s an element of security in it when compared to holiday letting, but that security also comes with a wider array of considerations. Being a landlord is potentially lucrative, but you’re then responsible for ensuring that your property is up to a certain standard – otherwise, you could be putting the health of your tenants at risk. Beyond that, it’s also important to recognize the inherent power dynamic at play, with you owning the space in which they live, and that means understanding how to balance this relationship.
It’s a situation that is much more complicated than it first appears to be. To that end, it’s worth researching advice for landlords thinking of renting out their property so that you can make yourself as aware as possible of any potential problems ahead of time.
Holiday Letting
If that all seems like it’s too much of a lifestyle shift for you, with too many opportunities for things to go wrong, you might turn your attention instead to holiday letting. While this can come with a lack of certainty by comparison, it’s also something that’s much more short-term – so long as your property is well-maintained and suitably in demand, there shouldn’t be a problem. However, you need to think about the kind of route that you’re going to take here – are you going to use Airbnb? If so, that’s going to mean that your projections of how much money you’re going to make need to take into account the fee that’s going to go to the platform. In addition to this, you need to think about the cleaning fee – and who you’re going to hire to keep your home clean after every event.
The issue of being in demand is also an important one to consider. Even if you run the numbers and come to the conclusion that this is the route that you’d rather take, the theory might end up being quite different from the practical reality. If not as many people want to rent out your property as you expected, this could create a problem. It’s also worth recognizing that you might not be able to just put your feet up and watch the money roll in – bad reviews or incidents arising will likely require your immediate attention and you might need at least someone nearby who can deal with the administration (such as handing over keys).
Life as a Landlord
There are also the more understated changes that can come with this kind of lifestyle shift – namely, matters like tax and insurance. It’s easy to think of this route as simply being an easy way to make money off of a property that you already own, but without approaching it in the right way, you might struggle to see the kinds of benefits that you’re looking for. For example, if you’re dealing with late or missing rent, it’s important to understand your legal footing. If the tenancy has already ended, there are still legal steps you can take to collect unpaid rent after tenant moves out. Filing with the LTB or seeking help from services that report rental debt to credit bureaus can be effective tools. Without a structured approach, these kinds of issues can quietly eat into your profits and complicate your responsibilities as a landlord.
However, there is also a trial-and-error element to it, and it’s worth remembering that some elements don’t necessarily require heaps of experience. While you’ll always get some people who are impolite or abrasive, most people just want to live their lives and that means that as long as you’re treating them with respect, they’ll do the same – something that can make most interactions much easier.