Edmonton has made some changes to the rules regarding secondary suites, meaning many more homeowners can rent out their property for extra cash every month. It’s an excellent way to get a secondary income or pay down your mortgage, but doing so means you’ll have to be a secondary suite landlord. Here are some tips for secondary suite landlords that can make your rental situation easier and more profitable.
1. Figure Out the Taxes
Before you even consider renting out a secondary suite, be sure to figure out if it will be profitable. Be sure to research taxation at every level to see how much you’ll end up making at the end of the year. In general, renting a secondary suite is very profitable, but it is unique for every situation. Once you’ve figured out if the rental is worth it, then you can start looking at rates.
2. For Rental Rates, Aim Higher
Having a competitive rental rate may seem like a great idea, but it doesn’t necessarily mean you’ll find someone faster, or find someone you want. Renting a secondary suite means you’ll be sharing the space to some extent, even if they are living above your garage, and finding the right person may mean aiming higher for what you’ll be charging every month.
3. Tell Your Insurance Company
Insufficient insurance can ruin your life, financially and otherwise, and your insurance company needs to know about your new situation to keep you covered. Not notifying your insurance company could result in criminal charges, voiding your plan, and financial implications from your tenant. Be sure to contact them and find the right plan for your new situation.
4. Get the Right Lease
Without the proper paperwork, you can seriously harm yourself in the future. Be sure to get an official lease signed and dated by the tenant so that the both of you have a document that keeps you each accountable and above board. Without a proper lease, your tenant can walk away without notice and end up costing you money in a variety of ways.
Renting out a secondary suite is a great way to make money, so long as you do it right. If you are becoming a landlord for the first time, be sure to listen to the advice of others, but also take the time to do the proper research on whether it will be worth it. By doing so, your secondary suite may be more profitable and run much more smoothly.