If you’re a new landlord or just entering the rental market as a tenant, then there are few things that you should know regarding residential rental property. If you have the correct information, you can protect your interests while also offering something in return to your tenant or landlord. In this post, we are going to share information about tenancy and rental appraisals.
This post will give you a clearer picture of the rental market as well as property for sale in Carlingford. We’ll begin with the types of tenancy. So, let’s dive right in!
Types of Tenancy
When it comes to tenancy, landlords have two options to offer to their tenants: fixed-term tenancy and periodic tenancy. Let’s learn about the advantages and disadvantages of both these types below:
1. Fixed-Term Tenancy
A fixed-term tenancy agreement is when the landlord and the tenant sign a contract for a fixed period. This period is usually anytime between six months and five years. Let’s weigh the advantages and disadvantages of a fixed-term tenancy for landlords.
Advantages of Fixed-term Tenancy
Here are the pros of offering a fixed-term agreement to tenants:
- It provides the opportunity to secure suitable tenants for the long term.
- Also, it allows you to plan your property maintenance budget accordingly.
- It makes it easy to plan the required property upgrades by the Healthy Homes Standards.
Disadvantages of Fixed-term Tenancy
The biggest and perhaps the only con of a fixed-term tenancy is that you get locked in the contract for the specified term. However, there are scenarios in which you can nullify the agreement. They include:
- When both the tenant and the landlord agree to end the tenancy.
- When the tenant sublets or assigns the property.
- If the tenant or the landlord applies for severe hardship to the Tenancy Tribunal.
2. Periodic Tenancy
A periodic tenancy is one with no specified end date. A periodic tenancy runs until the tenant or the landlord issues notice.
Advantages of Periodic Tenancy
Here are the pros of periodic tenancy:
- The most significant advantage of periodic tenancy is that it offers flexibility and doesn’t bind either party. Neither the tenant nor the landlord needs to wait for the contract to end before issuing the notice.
- It allows the landlords to evict troublesome tenants without worrying about breaking the agreement.
Disadvantages of Periodic Tenancy
Here are the cons of periodic tenancy:
- The biggest con for landlords is that the tenant can just up and go unexpectedly by giving only 21 days’ notice. This can leave the landlord in a bit of a tight spot as they need to find a new tenant in a short time.
- Higher chances of wear and tear on the property due to quick turnover of tenants.
- It makes it difficult for tenants to plan property maintenance.
Rental Appraisals: All You Need to Know!
Now that you understand the different types of tenancies let’s learn about rental appraisals. Rental appraisal is one of the most important things an investment property buyer can do. Rental appraisals provide you with updated information about the returns that your property’s rental income will generate.
Also, rental appraisals give you a clearer idea of your investment property’s financial viability and allow you to budget according to the expected return. Rent appraisals are performed by professionals that have experience in the local market. They will provide detailed information about your property’s return potential and the current market condition and trends.
When Is the Right Time to Get Rental Appraisals?
There are many occasions during which you should consider getting a rental appraisal done. For instance, when you’re purchasing a property for rental purposes, it’s essential to get a rental appraisal done to understand better what you’re getting into and the returns you can expect.
In most cases, banks also require a rental appraisal to see how much return the property can generate before approving the loan for its purchase. If you’ve owned a property for a while, it is also good to get a rental appraisal done to get updated information about its market value.
Final Thoughts
Rental appraisals are a reliable way of determining the return that an investment property has the potential to generate. It also gives you a clearer picture of the market value so you can price it accurately. If you’re searching for property for sale, make sure you get a rental appraisal done before making the final decision.
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We hope you found this blog post Things to Know About Tenancy, Landlord, and Rental Appraisal useful. Be sure to check out our post How To Create A Profitable Rental Property for more great tips!
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