With the record number of Americans relocating to South Florida, this is a great time to own rental properties. The demand for rentals throughout our area is currently as strong as ever. In fact, we are also seeing frustrated would-be home buyers re-entering or staying in the rental market due to getting outbid for homes to purchase, being priced out of the market, or diminished buying power due to rising interest rates.
Did you know? 33.75% of Florida households are renters (as of 2019). It is likely that this number is even greater now given the number of Americans relocating to The Sunshine State. Just like running any successful business, owning rental properties requires a thorough plan that incorporates several best practices. We discuss a few below.
Best practices
- Properly maintain your properties: Although this may seem obvious, it is surprising how many landlords do not adhere to this rule. Whether it is basic preventative maintenance or making necessary repairs in a timely fashion, it is critical that landlords maintain their properties. For starters, a property in poor condition will likely only attract tenants that don’t plan to take appropriate care of the property. As a landlord, you are better off spending the money to maintain the property correctly and thus asking for a slightly higher rent. In the end, this will likely attract the type of tenant that you will want caring for your property.
- Background screenings are mandatory: The last thing that you want is a delinquent tenant that is likely also destroying your property. For this reason, it is absolutely necessary that you properly screen all prospective tenants prior to entering into a lease agreement with them. By using a tenant screening service, you will be able to uncover items such as whether they have a history of paying their rent on time or have been evicted previously. In addition, these services will also highlight any prior criminal activity for a prospective tenant.
- Provide proper notice when entering a unit: Although a landlord may own a property, it does not mean that they are free to enter a rented unit whenever they desire. Under Florida law, landlords are required to provide at least a 12-hour notice when entering an occupied property. In addition, entering a unit must be done during “reasonable hours” between the hours of 7:30 am and 8:00 pm. To learn more about this, click here.
- Properly handle rental price increases: In Florida, there’s no limit on how much landlords can increase the rent on a Florida property. With this said, it is important that reasonable rent increases are implemented in good faith. In addition to monitoring property management costs, landlords may also consider monitoring the local rental market rates along with current inflation rates. A few items to consider when communicating rental price increases are:
- What will the new rental price be at lease renewal? (How much of an increase?)
- When will the new rent be effective?
- What types of payments will be accepted?
- Provide as much advanced notice for rental price increases as possible. If the tenant is on a month-to-month basis, the landlord will have to provide 15-day notice for the next payment due date.
- How to properly evict a tenant: All landlords should want to avoid having to evict a tenant. With this said, there are a number of reasons why an eviction may be necessary. If so, it is critical that proper notice is given and the process is handled legally. The length of required eviction notice will vary from state to state. In Florida, renters have 3 days (excluding weekends, holidays, and the day the notice was issued) to pay their rent or leave. Abruptly locking a tenant out of the unit, shutting off the utilities, or removing personal property may fall under Florida’s definition of retaliatory eviction.
Summary
Owning income-producing properties in South Florida can be an excellent way to supplement your income while also investing in your financial future. For many landlords, owning and managing rental properties is a full-time occupation. The state of Florida has experienced tremendous population growth in recent years and this trend is expected to continue for the foreseeable future. In addition, we are also seeing more companies relocating to The Sunshine State. Needless to say, the demand for rental housing is expected to remain strong or even strengthen in the coming years. Furthermore, with mortgage interest rates rising at a rapid pace, it is likely that more would-be home buyers will also compete for rental properties for the time being. At Live South Florida Realty, Inc, we have assisted many clients with building their real estate portfolio. Do you have questions? We can help! Contact us today!
At Live South Florida Realty, Inc. we have assisted many clients with their real estate needs. Are you looking to buy or sell a property in South Florida? Now more than ever, it is critical to have a qualified real estate team and the proper search tools behind you. Live South Florida Realty, Inc., has been a leader in the South Florida market for many years. Let our team of professionals assist you with buying or selling your piece of paradise today! In addition, our recently launched “Florida Home Search” app is now available on the Apple App Store and Google Play Store. With real-time MLS feeds, this app lets you set your own alerts to notify you as soon as a property meeting your needs hits the market. Furthermore, it will also let you know of recent closed sales in your area so that you may be even more educated on the market. Be sure to download this app for your smartphone or tablet today!
