If you have purchased one or more condos for sale in Irvine, you are in a good position to derive rental income due to the high demand for rentals in the city. As the premier planned city of Southern California, Irvine has been adjusting properly to the lifestyle many Americans are looking for, which insists on convenience, amenities, ease of pedestrian access, and a high quality of life. The Orange County housing market does not have as many condominium neighborhoods as some nearby cities, which means your units could automatically be in high demand from potential tenants.
Even with the ongoing demand for condo units in 2017, you stand to encounter some challenges as a landlord. However, you can still make some money by following these tips.
Get Your Condominium Association to Approve Rentals
When the American housing market crashed in 2008, condo associations and boards around the country adopted a carefree attitude toward rentals. Now that the market has recovered considerably, your association may have amended its bylaws and enacted some restrictions such as rental caps and percentage of the building that can be occupied by tenants. Before you present your proposal to the board, carefully review the bylaws in effect to ensure your request will have some basis.
Get to Know Your Potential Market
In general, you should market your condo units to tenants for whom money will not be an issue, which means people like company executives, high-level federal government employees, and senior UC Irvine researchers. If your condo association allows six-month lease contracts, you may be able to offer your units to seasonal tenants from Europe.
Vet the Backgrounds of Tenants
Landlords run the risk of leasing their properties to tenants who could become a neighborhood nuisance or turn out to be financially irresponsible. To this effect, trusting your instincts is not enough. You may think a senior researcher at UC Irvine will not give you trouble, but his or her family members might. Find out if potential tenants have a history of paying rent on time or if their relatives are known to get in trouble with the law.
Review Your Tax Liability
Once you start renting out your units, there is a good chance taxation will become a new issue in your life. You may have to notify the assessor’s office that the subject property is now generating revenue. Moreover, you will have to report your rental income next year before the federal tax reporting deadline. You will be introduced to new sections of Schedule E of Form 1040, and your overall taxes may be higher.
The Legal Process of Becoming a Landlord
The steps listed herein do not include everything you could face as a landlord. California is a complex rental market in terms of legal rights and responsibilities you will need to become aware of. The best you can do as soon as you have made the decision to rent your condo units is to retain an Irvine, CA, real estate professional to guide you through the process.
Even if you don’t want to be a landlord, there are plenty of other reasons to purchase a condo or other type of residential property. Whether you’re looking for condos or single-family homes for sale, Irvine, CA, is one of the best places you can live. Get in touch with OC Residential, and we can help you find your dream home or even a great unit to rent out to others. Give us a call today at 714-454-6304.