Hey there. This is Duncan Murphy with evernest in Nashville, Tennessee. I wanted to talk today about the top 5 reasons you should not rent your home in Nashville.
I know that sounds a little odd coming from a property manager.
But I meet with tons of prospective owners, is what we call them, prospective clients who are considering renting their home.
And truthfully, as I look in the owner’s best interests going forward, there are some kind of red flags that I’ve heard often and things I’ll talk through.
So, you can lean on a property manager or plenty of other resources out there to get an understanding of what your return should be, or what the rental amount should be for your property.
This is time to be very realistic. Looking at again, what is available through the internet and everything, it can give you an estimate of what you should expect.
Know you living there, you’re going to be a great source of information for, “Is the neighborhood up and coming?
Has it fallen behind on all the development in the area, or is it the next hotspot?”
So, you can start to see those trends and say, “Hey, this should really start increasing the rental value for it.” Or it might be time to say, “I just don’t see it increasing and continuing to appreciate.”
And I see this when, you know, somebody moves out, we place it on the market, we find a tenant, we screen that person.
And then, who knows, maybe within the first couple months, a plumbing issue comes up.
I hear it all the time from owners that they feel that there was negligence or the damage happened because the tenant was malicious.
So, this is really where you have to detach yourself from the home and realize that things just have an expected lifespan, things are going to break, whether it be you live in the home or this tenant that was placed.
Things are going to come up and they have to be fixed.
What I always try to… the point to drive is that the tenant is going to be the most important part of you having a rental property.
So, it’s important to keep them happy. Sure, if a tenant was negligent and maybe a child flushed a Barbie doll, then that’s tenant responsibility.
Those are things that you’re protected by in the lease. But just because something happens does not mean it’s the tenant’s fault. So, be ready to kind of pull yourself away from that feeling.
The third point I’d like to talk about is if you are in flux you say, “Oh, I’m moving out of state, I’m not sure how long it might be.” It might be six months, it could be your 14 months.
It really is most helpful to have a very set timeframe. We have a… what we counsel is we need to have a minimum of a one-year lease because the turnover is really not worth it if it’s anything shorter that. So, we need to say it’s a minimum of one year lease.
We can touch base in the last 90 days of the lease term to see where everything stands if we need to go month-to-month.
But if you are really cutting it close to what a lease term would be, then it can really cause some headache if those two timeframes start to clash towards the end. So, something to think about.
Again, maintenances to be expected in a property. If expenses do come up and this might negatively affect your responsibilities with your mortgage, your income, something that you’re relying on the rent, there’s got to be some sort of cushion there to where you can still make things work.
If your water heater is 12 years old, it is knocking on the door, you either get a really good one that lasts forever and you don’t think about it, or that 12 or so year mark is really the end of a lifespan.
So, that can be… depending on the work that goes into it, a vendor might charge 1,000 bucks.
If it’s a four-ton unit and it’s 15 years old, it could really start to break down and you’ve got to move quickly if an A/C goes out here in Tennessee.
So, you’ve got to be able to jump in and take those expenses in your stride. So, something to consider.
And then lastly is, if you happen to know of a friend or a family member wanting to move in and rent the property, it’s probably not ideal to set up with a property manager.
Because the relationships and the strains that it can put on a relationship, you’re automatically not going to be able to be hands-off because that person knows you personally.
Something I always push for is to say, “Hey, you hired us for a reason, you hired gkhouses for a reason. Let me be the only point of contact for this tenant. I want them to know us and know that we’re here, looking out for them. We want to get their problems resolved.”
So, those are really five points I think I talked about. Yeah, there’s plenty of things to weigh up.
In any of my appointments with potential clients, I’m always open to their questions and weighing these things with them. It’s got to make sense to you.
You’re the most important person for it to make sense to. So, I’m happy to talk about it whether we meet or if you just wanna reach out to us.
Our information is gkhouses.com, the email address is [email protected] We’d love to hear from you and talk further. Thank you.
Spencer is the VP of Marketing at Evernest. He wakes up with Google and Facebook on his mind. Having bought and sold over 150 homes in Birmingham, Spencer gets a kick out of helping new and seasoned investors navigate the mistakes he made as an investor. Spencer is also passionate about his love for Michael Jordan and does his best to explain to the Millennials (who never saw him play live) how much better he was than LeBron. He loves to hang out with his wife, kids, and the world’s best black lab, Jett.