If you own a home in Washington, DC, then you’re sitting on an excellent piece of real estate. For those that live in their district homes, extra space in the basement can mean big parties and lots of storage. Others who keep a home in the district but live and work elsewhere always have a comfortable place to crash when they’re in town.
But homeowners could be making better use of their DC properties while also bringing in some extra income. By renting out a basement apartment or even the whole house, owners can add another stream of revenue to their income and begin building an investment property portfolio.
Interested in renting out your Washington, DC home? Here’s what you need to know to get started.
What you need to know before renting out a house
Renting out a house or part of a house may seem like an easy way to bring in extra income, but it does take work to manage the property, find tenants and maintain the upkeep. Before you commit to being a landlord, remember:
- You will be responsible for registering your rental property with the district and keeping it up to code.
- Finding good tenants isn’t always easy. Washington, DC has a competitive rental market. You need to be savvy to attract the right tenants who will treat your property well.
- When a pipe bursts or an appliance needs to be replaced, you will need to do the work, not your tenant. If you wait too long to make repairs, the damage could get worse — and more expensive.
- You will need to keep track of all license renewals and any needed inspections.
All of this can be overwhelming, especially for new landlords. Partnering with a property management company like Atlas Lane can help you manage the day-to-day tasks of being a landlord and finding tenants while also keeping track of your finances and licenses. When it comes time to file your taxes or renew a license, you’ll have all the paperwork done and ready to send to your accountant.
How to rent out a house in Washington, DC
In order to rent out part or the entire home in Washington, DC, there are some licenses and inspections that you must pass.
First, you need to categorize your unit — one-family or two-family rental or apartment. If you want to rent out the entire home, then it’s a one-family apartment, which means just one tenant, roommates or family. For landlords that want to rent out the basement or coach house while living in another part of the home or property, then it’s a two-family rental. Apartments are for buildings with three or more units.
You will then need to meet three requirements:
- Corporate registration (if applicable)
- Tax registration
- Basic business license inspection requirement
In Washington, DC, there is no cost to do an inspection. However, if the property fails or you reschedule the inspection with less than two days warning, then you will have to pay a $90 fee in order to receive your license.
Once you’re unit or home is legal, then you can begin:
- Drawing up a lease, which should be looked at by a property management company or a real estate attorney.
- Researching how much to charge for rent. This will depend on your location and the market at the time you put your place out there.
- Buying insurance to protect yourself from liability.
- Finding tenants, which should be the last thing you do.
If you enlist the help of a property management company like Atlas Lane, then many of these tasks will be someone else’s job to complete. All you need to do is wait for the tenants to move in and start collecting your rental income.
Atlas Lane has guided many first-time landlords as they’ve made their foray into investment properties, and our professionals are experts at finding good, long-term tenants. Contact us today and see how we can make renting out a home in Washington, DC an easier and more enjoyable experience.