10 Tips for a Successful Rental Business in the Philippines


Do you have an extra room because your child moved out for college? How about an extra house that you purchased before you moved in to your new home? If you have an extra space and want to make money out of it, then renting it to other people is the best way to generate income from spaces you currently don't use. And if you want to engage in a rental business here in the Philippines, here are 10 tips for you to become a successful landlord.

Sign a Legal Written Agreement between You and Your Tenants

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This is a must have for every landlord. Some home owners feel that they don’t need to have a written lease of contract between their tenants. This written agreement will actually save you in case there are legal problems that you encounter with your tenants. In my case again, I let them sign a contract of lease with many stipulations that states about the amount of rent, the do’s and don’ts that I want to happen in my rented space as well as some legal agreement that in case of failure to pay, I have the right to evict them in my premise. You can have your lawyer write your contract of lease to include more legalities.

Quality Products Equate Happy Tenants


Provide your tenants with quality products in your space so they will stay in your property happily and hassle free. This means that you offer them with useful fixtures inside the room or the house. A functioning toilet, a sturdy door and windows, running water and many more; these are some of the things that you need to have for you to attract tenants as well as keep them for years renting in your space. Quality products doesn’t mean you need to put granite in your kitchen counters or install a pricey tub or lavatory in your bathroom. It means that you need to provide better than average products in your rental space for your tenants to live comfortably.

Create Policies for Your Tenants


Make rules that you implement guidelines in your rental space. Some of these rules include how many months advance and deposits they need to pay upon entering the premise, what are the rules about utility payments, etc. Also, make guides about things they need to do or how they must behave when they are in your premise to avoid conflicts and problems with you and your other tenants. If you want to have a curfew in case you rent a boarding house, always explain to your-would-be tenants about for them to know before they decide to rent the space. Create policies and rules for a harmonious relationship with your tenants.

Apply for Government Permits to Avoid Problems


In the Philippines, we have several government entities that you need to get permits from in order for you to open a rental business. These are the Bureau of Internal Revenues, business permit in your local City Treasurer's office, Bureau of Fire Department, and many more. Be mindful that there are fees you need to pay in order to apply for government permits.

Be Stern about the Rent Due Date

      
Many landlords experience tenants that do not pay their rent on time. This is one of the major problems that you encounter with a rental business. So always be stern but still respectful. Do not be like a landlord which is usually portrayed in movies wearing duster with fan on one hand and the other hand on the hips swearing and shouting for their tenants to vacate the place. Be strict when it comes to the due dates of their rent since you had done your part in providing a safer and better environment for them so they should in return the favor by paying their rents on time - it is a business after all.

Always Screen Your Renters


Being a landlord opens your place to different types of people you do not know. So always screen for the bad apples. It really depends on you, on what is your idea when it comes to screening them. Some require a barangay or an NBI permit before they rent their space. Others need a photocopy of their government identification cards like driver’s license, SSS, GSIS and many more. This will make sure that you are transacting with the right person.

Always be Mindful about Repairs and other Problems


If you rent a space, there would come a time that you and your tenants will encounter minor or even major problems in your space. Leaking faucets, busted door or window jams, broken things are some of the problems that you may encounter if you are a landlord. Your tenants will give you notice about the problem so you need to start repairs immediately to avoid any more conflicts with your tenants. Always remember that a happy tenant tends to stay longer. And longer staying tenants mean more money every month for you. Have a sense of professionalism, especially in being prompt when it comes to fixing problems with your property.

Know When to Outsource


There are many problems, may it be small or big that you face being a landlord. If you can deal with small problems, then better do so right away to avoid spending money to hire people to fix the problem when it gets worse. But if you need an expert plumber, electrician or even a carpenter to perform the task, always know when to outsource. I have a friend who rented his extra room to a tenant. One time, there was a problem with the drainage. Even though he doesn’t know a thing or two about plumbing, he tried to repair the drainage and ends up ruining it more. So you should gauge yourself on your ability to personally conduct repairs or have the job outsourced. Always keep your maintenance contacts for you to call them when you need help.

Be Organized


Always be organized with your contracts of lease, receipts and daily records for easy retrieval. These would come in handy in case there are some discrepancies in your records. In my case, since I also rent spaces for people, I make it a point that I keep the contract of lease in one folder in case there are some problems that arise in the rent. This will save you time to seek legal papers for your accountant, lawyers and etc.

Move in and Move out Inspection


It wil be best if you document the space before the tenants move in and before they move out to check if there are damages to your property. If in case there are, you can deduct it in their deposits. These will prevent you from shedding out your own money for the damages that the tenants had caused.

So there you go. These are 10 amazing tips to be able to become a successful landlord. So good luck and build your own rental business in the Philippines. 
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