What You Need To Know When You Rent Your Home Direct To Tenants

When renting out your property in Kissimmee, Davenport or South Orlando, you have two options: do you put a sign up for rent by the owner or hire a property manager to handle the process?

Are you ready to explore the benefits and drawbacks of each option to help you decide which is the best fit for your needs?

What Does it Mean to Rent by Owner?

Renting by owner refers to a property leasing arrangement where you, as the owner, handle the rental process without using a property management company or agent.

You manage listing the property, screening applicants, drafting agreements, and addressing tenant concerns directly. This approach can save you money on management fees but requires a lot of time and effort in overseeing all aspects of the rental. You will save money, but it can almost turn into a second job, before you ever get a decent list of applicants.

Renting out your property as an owner means you are responsible for all aspects of managing your property. This includes advertising the property, screening tenants, arranging a lease agreement, holding a security deposit, collecting rent, handling maintenance and repairs, handling legal issues, and enforcing the lease.

If things go wrong, you must serve the tenants with an official notice to pay the rent or quit the premises. This is easy for an experienced Orlando property manager as they know how to do it. Many owners who rent direct to tenants struggle with this.

Benefits of Renting By Owner:

You Save Money

The primary benefit of deciding to go For Rent By Owner for your rental property as an owner is cost savings. You can avoid paying for complete turn-key property management as fees range from 8% to 15% of your monthly rental income.

This can be significant cost savings unless you rent your home to unqualified tenants and dread trying to collect your rent.

Greater Control

Renting out your property as an owner gives you complete control over your property. You can set your rental rates, choose tenants, and handle all maintenance and repairs. This level of control allows you to make decisions that align with your goals and priorities.

But what if you end up with tenants who don’t pay the rent timely or don’t keep the home in good condition? A good property manager doesn’t wait and deals with delinquent tenants swiftly.

Direct Communication with Tenants:

When renting your property as an owner, you have direct communication with your tenants. This can lead to better relationships with your tenants and a better understanding of their needs.

Alternatively, you may become too friendly with them, which can lead to more issues. Giving them your phone number lets you quickly address any issues or concerns, preventing problems from escalating.

Or are you already too busy to follow up with tenants’ concerns? If so, a professional property manager might be a wise choice.

Drawbacks of Rent Your Direct To Tenants

While renting by owner puts you in control and saves some money, it can turn into a nightmare and cost you longer down the road. Here are the main reasons why we recommend using a property management company and not wasting your efforts with renting out directly:

Time-Consuming

Renting out your property as an owner can be time-consuming. You are responsible for managing your property, which can take much of your precious time. You’ll need to find an attorney to draw up a lease that complies with any landlord and tenant laws changes.

If you buy online or from an office supply store, this might not be up to date or give you the protection you need. A good property management company will have an attorney they use for lease preparation.

We already have many systems in place (after more than 3 decades, one is clearly better organized than a complete beginner) and can handle all this workload faster and with better outcomes.

Limited Resources

You may have limited resources to manage your property effectively as an owner. For example, you may not have access to the same advertising and marketing resources as a property manager.

How about rent collection?

Will the tenants have access to pay their rent online? Can they call you or email you with any concerns? What about access to professional tradespeople? Your property manager may be able to offer you discounted repair rates as they use the same tradespeople all the time.

Benefits of Renting Out Your Property Through a Property Manager

Renting out your property through a property manager means hiring a professional to handle all aspects of managing your property.

This includes advertising the property, screening tenants, collecting rent, handling maintenance and repairs, and handling legal compliance issues. Florida’s landlord and tenant laws are constantly updated.

A property manager has to keep up with all these things.

Time-Saving

Renting out your property through a property manager can save you time. The property manager is responsible for all aspects of managing your property, which frees up your time for other activities.

Access to Resources

A property manager has access to a wide range of resources, including advertising and marketing resources, legal resources, and maintenance and repair resources. Often they get discounted rates on all kinds of repairs and replacements as they use vendors often. This can help you manage your property more effectively and efficiently.

What about hurricanes and other natural disasters?

Hours after the hurricane makes a landfall, you are waiting in vain to get someone to repair your roof, windows and home. Our rental investors were already getting their quotes and our maintenace crews were starting work as soon as possible.

We have our own network of construction teams, maintenance crews, landscape experts etc. And all our clients need to do is let us know there is an issue. Our teams would assess and then start work.

Expertise

A property manager has expertise in managing rental properties. They are familiar with landlord-tenant laws and regulations and have experience screening tenants and handling maintenance and repair issues.

It’s what we do every day and we have a long tenure in this industry.

Drawbacks of Renting Out Your Property Through a Property Manager:

Cost

Cost is the primary drawback of renting your property through a property manager. Property management fees can range from 5% for rent collection only to as high as 30% of your monthly rental income, which can be a significant cost over time but may save you money in the long run.

Our company has 2 tiers: 8% and 10%, which are both extremely affordable and packed with services and perks. Take a look at our property management fees.

Limited Control

Renting out your property through a property manager means you have limited control over your property. The property manager is responsible for all aspects of managing your property, and you may not agree with all of their decisions.

It’s wise to choose a property manager that lets you know what needs doing to your home and is available to discuss your expenditures. You need to be on the same page when spending your rental income.

Communication

Renting your property through a manager means you shouldn’t communicate directly with your tenants. Otherwise, you could end up with a he said; she said situation.

For example, the tenant may tell the property manager that you said they could have new carpets, and you don’t remember talking about it. All communication about the home and its repairs and replacements should be done through the property manager.

Some tenants may emotionally appeal to you not to increase their rent when renewing their lease. As an owner, you may like how they keep your home and don’t want to upset them.

A good property manager knows small increases over time, and keeping your rent aligned with what other homes are renting for is in your best financial interest.

Professional Licensing

In Florida, as a homeowner, you can rent your properties directly to the public. If you want to rent homes other people own, you must be a licensed Real Estate Agent. With that comes mandated continuing education to stay current with all the legal updates and changes to the landlord and rental laws.

A good property manager will also have years of experience dealing with everything from hurricanes to tenants who have fallen out with each other and want to move out before the end of the lease.

Over the years, you develop an instinct for who will be a problem tenant and, most times, move on to the next applicant and avoid the ones who may not be a good fit for your rental home. None of us want tenants that lack secure income and seem unreliable. Call us at 407-933-2367, in the UK at 0161-300-9595, or email hello@renterschoicehomes.com, and you’ll be glad you did!