The Pope is paying a visit to Philadelphia in September 2015 and the city is buzzing in anticipation!
Some Philadelphia residents are considering renting their home to others during the duration of the Pope’s visit. They see the visit as a great opportunity to earn income. With websites like Airbnb making it easy to list your home to out-of-town renters, many people see short-term rentals as an attractive way to raise substantial income.
With this income opportunity comes risk. That’s why we offer you these 7 tips for success with short term rental of your home during the Pope’s visit to Philadelphia:
- Find a good tenant. You can find tenants by placing ads in local community newspapers and online venues. Ask prospective tenants to fill out a rental application (you can find samples online) that lists information like their name, permanent address, employer, income and references. You’ll also want their social security number and signed authorization to check their credit and criminal history. With the applicant’s permission (and even without their social security number), you can check their payment history through agencies like TransUnion, Experian, or Equifax.
- Determine how much to charge and what you will or will not include in the rental amount. Get an idea of short term rental rates by calling property management firms and asking for their input. You can also check online resources and newspaper ads that advertise for short term tenants. What you charge will also be determined by the amenities you offer with the rental of your home. It’s generally expect that you provide a clean space, clean linens, towels, toilet paper, microwave, kitchen utensils, internet and access to outdoor areas, in addition to furnishings.
- Have a written lease agreement. It’s important to have a written agreement that spells out the obligations and understandings of each party. Make sure your lease agreement is in compliance with Federal and Pennsylvania laws on fair housing, rental, tenant and insurance laws. We recommend you find a good local lawyer to help you with the agreement. It should contain the lease term, security and cleaning deposit amounts, due dates for payments, routine maintenance and upkeep responsibilities, a list of people that will be staying on your property, rules of behavior, pet policies, the circumstances under which you may enter the home when it is occupied by others, your liability concerning renter’s goods, property and safety and eviction terms.
- Make sure you have adequate insurance coverage. You’ll most likely need different coverage when renting your home to someone than you will if you occupy it, even if for a short period. Keep in mind that these short-term rental policies traditionally provide little coverage for things you leave for the renter in your home…ask your agency about covering the contents of the home as well as your home itself.
- Encourage your renters to provide their own insurance coverage. You don’t want to be responsible for renter’s belongings so encourage them to buy insurance (commonly called “renters insurance”). This protects them and you should something happen when they are staying in your home to cause their belongings to be damaged or stolen.
- Hire a management company. They can help you find tenants and manage the interactions with the tenant. They can collect rent, handle issues, interact with the tenant on your behalf, and handle arrivals, departures and evictions. These companies are especially useful in documenting the condition of your property prior to it being occupied by the short-term renter. If they help you find a tenant, expect to pay about 25% of the rental amount. Management companies will also charge about 4%-12% of the rental amount for management services.
- Expect the best but be prepared for the worst. If the tenant doesn’t leave on time, or damages the property, in most cases you’ll need an attorney to get them out or to deal with the issue. You’ll have to go to court and in most instances the sheriff will need to come to your home and physically remove the renters forcing you to then change the door locks. It’s wise to make a clear video, date and time stamped, of the condition of the interior and exterior of your home prior to renting in case it is needed to help establish damages.
Philadelphians are looking forward to the Pope’s visit to the city. If you’re going to rent your home short-term to people during the Pope’s visit, follow these tips for the best possible experience.