When you own a property and do not want to keep it unoccupied, then you have no other option but to rent it to obtain additional income. However, before making the decision, you do not want to put your property at risk and you want the person who is going to occupy it to keep it in good condition, in addition to paying the rent on time.
When renting a house or apartment you must consider several characteristics: the person you want to have as a tenant, the price you are going to charge, the forms of payment, the conditions you are going to put in the contract, and above all the way to operate in the legality when renting the property.
Remember that the price of the rent will be determined by several factors: the location, if it is furnished, the number of bedrooms it contains, toilets, kitchen, study room, etc. Also, if it includes additional services such as telephone and parking, among others.
Know your tenant
Generally, you don't know the potential tenants. You don't know where they are from or what they do, that's why you should always ask them for a proof of address, ask what activities they do, that will give you an idea of what their income is. Be as sure as possible and ask for the name of a guarantor, who will have to respond in case the tenant does not comply with the corresponding payments.
Explain which services are included in the rent (electricity, water, building, telephone, etc.) and which are not. In addition, it should be clear who will pay for any damages that may occur in electrical installations, plumbing, and painting of the property.
Everything within the law
Finding a person with economic solvency and good credit history does not guarantee that he/she will be a good tenant. It is better to draw up a proper contract since the information it contains will be very useful in case of any breach by the person to whom you are going to rent the property.
To be on the safe side, ask for advice from a lawyer or a real estate professional. Try not to buy the forms sold in the stationery stores, because many times they are already obsolete, and in case of a lawsuit they will be of no use to you.
Do not get carried away by emotions and want to rent your property to the first tenant that knocks on your door. In your haste, you may draw up a quick contract without foreseeing the consequences that this may bring in the future. For example, the tenant may only pay the deposit and the first rent, and then you never see him again; he may leave your property without notifying you or he may not want to pay the rent until you decide to kick him out of your house or even file a lawsuit, but you can only do the latter if you have a well-drafted contract and the corresponding permits.
The Federal Civil Code establishes that there is a lease when the two contracting parties reciprocally bind themselves, one to grant the temporary use or enjoyment of a house, and the other to pay a certain price for such use.
When you are going to rent the property, you must have the documents that prove you as the owner. In addition, by law, you are obliged to declare the rental income. Nowadays, the most common thing is that the lessor is not registered with the Ministry of Finance and Public Credit (SHCP), likewise, the lessee does not request proof of payment of rent, because he/she believes that the lessor is charging a lower rate.
If you are one of those who want to rent and do not have your papers in order, on the SHCP website http://www.sat.gob.mx you can consult the process you must follow to rent your apartment or house.
With the documentation in order and the corresponding permits, now worry about the elements that you will include in the contract. The Civil Code establishes that the lease contract must be in writing, the lack of this formality will be imputed to the lessor.
The contract must contain at least the following stipulations:
Names of the lessor and lessee.
The location of the property.
A detailed description of the property object of the contract and of the facilities and accessories for the use and enjoyment thereof, as well as the condition thereof.
The amount of the rent.
The guarantee, if applicable.
The express mention of the residential use of the leased property.
The term of the contract (generally one year).
Likewise, you must specify the obligations that the lessor and lessee contract in addition to those established in the Law, such as the additional fee that you will charge in case of late payment, if you are going to allow them to have pets, dates in which they must pay you the rent, period in which if they do not pay on time they can proceed legally and how they must leave the property when they plan to vacate, among others.
Furthermore, in the contract, you must specify the condition of the property, as well as the state of windows, doors, plating, sanitary, electrical installation, studio, etc.; additional services such as telephone and parking. When the contract has been formalized and both parties agree with the conditions that have been agreed upon, the owner of the property will keep the original and will give a copy to the tenant.
It is important to sign a new contract with new conditions once its term is over, especially if you intend to increase the price of the lease. Remember that in order to increase the rent to your tenant, the annual inflation index published by the National Institute of Statistics and Geography (INEGI) is generally taken into consideration. The foregoing is linked to Article 2448-D of the Civil Code, which establishes that the rent must be stipulated in local currency and its increase will be annual.
When the landlord and the tenant reach an agreement on the rent of the property, the relationship does not end there, since both have mutual commitments. Here are some of the landlord's responsibilities:
Make any needed repairs to the property. For example, waterproof the roof before the rains come.
Maintain in good condition the electrical connections, plumbing, and door plates, among others.
Keep common areas clean.
Indicate if parking is available.
Pay attention to the tenant's suggestions about the maintenance required by the property.
The tenant also has responsibilities
Pay the rent on time.
Notify the landlord about any maintenance that the property requires or other aspects that he/she considers important.
Discuss with the landlord if you plan to perform any type of maintenance, for example, painting the interior of the property, changing the door locks, etc.
Communicate in advance to the landlord that you will be leaving the property.
Use the rented property only for the purposes stated in the lease.
If for any reason there is a dispute with the tenant arising from the lease, consult a lawyer or real estate professional.
By Amadeo Segovia Guerrero and Carlos Enrique García Soto