 Image via Unsplash Are you thinking about turning your home into a long-term rental property? While there are obvious benefits to selling your home, there are also benefits to renting it out. Not only do you have the chance to bring in additional income each month and grow your investment portfolio, but renting out your primary residence typically means that you can keep the lower interest rates in place, as opposed to the higher interest rates that come with purchasing an investment property.
With that said, it’s important to know what you’re getting into and to approach it the right way so you can be successful as a landlord. Read on to learn more about converting your home into a long-term rental, along with special considerations in light of the coronavirus pandemic. Make Sure You Want to Be a Landlord First of all, do you really want to be a landlord? There is a lot of responsibility involved. Particularly if it’s your first time, you might be handling much of the responsibilities yourself, and it can get overwhelming if you’re not committed or well-prepared. The benefits are real. Just be sure that you’re up for the management tasks involved (e.g., making repairs, keeping the property maintained, dealing with tenant complaints, etc.) and that it won’t put you in a precarious financial position. If you can budget for it, Rentec Direct suggests hiring a property manager. It’s an investment, but it can save you a lot of time, energy, money, and stress in the long run. Look into Cash-Out Refinancing You will likely need to make some changes to your home before renting it out, which we will discuss below. If those changes include remodeling or other types of major improvements, and you need a way to cover the costs, one option is cash-out refinancing. Lenders like PennyMac replace your existing mortgage loan with a new, larger one. Then, the difference between the two loans is given to you in cash. You can then use that cash to pay for home improvements. Another thing to consider is that the coronavirus has caused interest rates to drop significantly. Therefore, now could be the perfect time to refinance. Make Essential Repairs One type of improvement that you will probably have to make is essential repairs. This includes any big or small projects that will ensure the safety and function of the property. For instance, if the roof has seen better days, there is an issue with the plumbing or electrical, or there’s a broken step in the entryway, those things will need to be addressed before you put your home on the rental market. Think About Upgrades Other than the essential repairs, you will also want to consider any ways that you can generally improve the appeal of your rental property. Do you have up-to-date appliances? Do you need to repaint any areas of the home or replace the flooring? Perhaps a kitchen and/or bathroom remodel could help you draw tenants. Evaluate the overall aesthetic and function of the property, and determine what changes are worth making. Consider the Coronavirus Pandemic Lastly, there are a few considerations that need to be made during the pandemic. You will need to make sure your property is thoroughly cleaned and disinfected before tenants visit or move in. Also, utilize virtual tours, video chat, virtual open house events, and other technological means of showing your home and interviewing potential tenants to reduce the risks of spreading the virus. Moreover, a lot of tenants are having trouble making ends meet right now, which as CNBC points out, could present problems with rent payments. Nonetheless, as long as you understand the risks and come up with a plan for how to work with tenants in such a situation, you shouldn’t let that prevent you from renting out your home. Turning your home into a long-term rental is a great way to boost your income and investment portfolio. Just be sure to consider all the factors involved (both general and coronavirus-specific) to make sure it’s right for you. In no time, you could be renting out your home and raking in the cash!
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This awful coronavirus may define our time. But it shouldn't; it should make us stronger, kinder and smarter, and hopefully it will. We have been seeing examples of that everywhere, from communities supporting the most vulnerable to individual examples of paying it forward. The global human toll has been horrible - think of every person who has succumbed and how many are directly affected by that one loss. Then factor that by the current estimate of well over 300,000 lost and the picture is terrible. Follow that with the effects of the economic tsunami, job losses, businesses lost, the inability of so many to provide the basic necessities, the effect on mental health, the list goes on. Another major socio economic consequence is beginning to play out; that more and more city dwellers are making, or considering making a move to less densely populated areas, namely suburban communities and the rural countryside, which they see as safer for them and their families. There are so many benefits to making the switch from living in the smoke, as we called it growing up in central London in the 1970's. Obviously benefit number one is the ability to move around without the constant proximity to other people which one experiences in cities, thereby reducing the risk of catching this, or any other virus. But raising a family with room to move around is healthy in other ways: The mental, physical and social advantages to children and adults is immeasurable. I remember when, as a kid in London literally kicking a football (aka soccer ball) around in the street, dodging cars and trucks, my brother was hit by a speeding car. Fortunately there was no lasting injury, but it could have been far worse. According to new data from Harris poll described recently in USA Today, almost a third of Americans are considering a move to a less densely populated area, "foreshadowing a shift that would have a major impact on residential real estate sales and home prices". Lawrence Yun, chief economist at the National Association of Realtors, predicts that “People will be much more cautious about living in high-density areas with so many people nearby”. Business Insider writes that millenials are less willing now to gamble on urban real estate, and now that we are seeing a major shift to working from home, as long as there's a good internet connection, the need to be physically close to 'the office' is fast becoming less of a priority than pre-COVID. Politico warns that "It’s now obvious, if it weren’t before, that staying in big cities can be bad for your health". With 60% of the world's population living in cities, that makes for an alarming potential number of people who may make the transition away from urban areas. All in all, it seems clear that we may be in for a rush, once things open up, to find properties with ample space for urbanites to find their new Zen. Yet history is filled with events which forced populations to leave major conurbations only to see the balance restored in the years and decades that followed. It seems to me that the ebb and flow will likely continue to ensure that ultimately, the human spirit will endure, and mankind will live where it wants to.  Country properties available through Hunt Country Sotheby’s International Realty
With 5,500 finished square feet, this is the ideal place to live in the new normal, as it has a large home office suite above the three car garage, perfect for working from home.
A Generac backup generator has been installed so that, in the unusual event of a power outage, it will engage automatically to provide a significant amount of the power needed in the house. Priced incredibly competitively at $695,000, this property may go before it even hits the market. Check out the full details HERE. The novel coronavirus, COVID-19, has quickly triggered novel ways in which real estate agents approach their business. Case in point is the fledgeling virtual open house. Traditionally, we Realtors host face to face broker and public open houses, which enable us to promote our listings, and get the word out about a specific property. That all changed with the onset of this pandemic. Now, thanks to video, and live electronic meeting programs, we have the opportunity to host virtual open houses, where the listing agent schedules an open house as normal, bute adopts a platform such as Facebook Live, Zoom, Facetime or other similar live two-way video feed to 'virtually' show the property. I'll be hosting my first virtual open house this Sunday April 19th, 2020 between 1:00 p.m. and 2:00 p.m., at 3 Chinn Lane, Middleburg, VA 20117 , and I am pretty psyched about it! And mildly apprehensive too...as happens with something new.  I've chosen Zoom as my platform of choice, which I have been using for online meetings lately. Zoom has a lot of great features, one of which is requesting that participants register in advance, which I will be implementing. In this way, I will know how many 'visitors' I should expect, but it also allows me to offer a prize drawing to all who register - and attend! A fun incentive and another way to create extra buzz. It is also essentially a virtual sign in sheet, and will enable me to get feedback later. Further, for this first virtual open house, I will be interviewing my client, the seller, while we both adhere to strict social distancing guidelines. Prospective buyers and their representatives will have the opportunity to ask her about her house, why she purchased it in the first place and what she loves about it. And what she will miss. During this unparalleled point in our lives, there is a great deal of introspection going on. Perhaps many things we have taken for granted in the past will remain things of the past. Kindness and neighborliness, appreciation and generosity can be seen everywhere. Long may that last. But adaptability has seldom been a more critical tenet, one which we will all be working on the longer this goes on.
Stay safe, look out for one another - we are in it together.  To garner a medal, or medals at the annual Virginia Governor’s Cup wine competition in Richmond is an achievement in itself, but to be crowned as the overall winner is the ultimate accolade, and an acknowledgement that the victor’s wine is the best in the Commonwealth. 868 Estate Vineyards, located just west of the Town of Hillsboro in Loudoun County, Virginia accomplished this impressive feat in February 2020 when it triumphed over 105 competitor vineyards, which entered no fewer than 530 wines, to become the 2020 Virginia Governor’s Cup outright winner. 868’s winning wine was its 2017 Vidal Blanc Passito, made from the American hybrid grape, Vidal Blanc, and made using the Italian appassimento method. This technique is one where the grapes are partially dried for a month in shallow baskets in order to produce a highly concentrated sugar content. The result is a rich, sweet and intense honey, pineapple and tropical fruit flavor, best served cold. The idea behind this particular varietal was the brainchild of winemaker, co-owner and company president, Carl Di Manno who, together with fellow owners Peter Deliso and Wendy Charron, purchased the 120-acre property, which included renowned farm to fork restaurant, Grandale Farm restaurant, in 2011. Saving it from becoming what was destined to be just another housing subdivision, 868 Estate Vineyards was founded. Now, less than a decade later, the Governor’s Cup resides proudly in the 868 Estate Vineyards tasting room, where it will remain until next year’s winner is announced. Grandale Farm’s executive chef and co-founder, Author Clark, had been creating exquisite dishes for its discerning clientele since the restaurant opened in 2005 until late 2019, when Chef Clark passed the baton to Chef Thomas Kozak. Today, Grandale offers all of 868’s wines to its diners which include its Chardonel, Chardonnay, Cabernet Franc, Merlot, Cabernet Sauvignon and Canvas White, a blend of Chardonel and Vidal Blanc. Initial grapevine planting took place in 2012, and resulted in 10 acres of vines which has expanded to 22 acres during the intervening eight years. Visitors enjoy their favorite wines either in the tasting room, conveniently located opposite the restaurant, or outside under or by the pavilion. Notably, all of the grapes which went into the winning wine came from the estate’s one third acre, dedicated Vidal Blanc vineyard block! In addition to the tasting room and restaurant, 868 takes art seriously, with local artists from Loudoun and Fairfax Counties in Virginia, Montgomery County in Maryland and Jefferson County in West Virginia exhibiting and offering their works for sale for three months at a time. Events at 868 include several weddings and corporate gatherings annually plus festivities tailored specifically for ‘Elevation Club’ members, patrons who have committed to buying one case per year, picked up four times annually. In the words of Peter Deliso’s wife, Nancy, 868’s Marketing Director, “868 Estate Vineyards is an avid proponent of a culture of wine, food, art and nature, all of which flourish at the property”. These four values appear to resonate with a lot of folks judging by the number of people coming and going during my visit. 868 Estate Vineyards and Grandale Farm Restaurant are located at 14001 Harpers Ferry Road, Hillsboro, VA 20132. (540) 668-7008 Originally published in the spring 2020 edition of Country Zest & Style magazine - words and photos by Peter Leonard-Morgan Every now and again, a remarkable property comes up for sale. I was fortunate enough to have been engaged by the owners of an 11.7 acre parcel in Great Falls last year which closed this week. It is in fact two spectacular parcels, located in Cornwell Farm just off Georgetown Pike. My clients have owned these properties since 1972 and built a family home on one of the lots in 1978.   Any new undertaking is bound to prompt questions, especially when it involves a large sum of money. As you dive into your first investment property, you’re probably wondering how to select a promising property, how to attract future renters, and what your responsibilities will be. Read on as we explore all this in detail! What Makes for a Promising Property? There are many things that contribute to how profitable an investment property is. Topping the list is location. For example, when you look at the available data, Virginia offers a profitable rental market, both for short- and long-term rental properties. The vacation rental market and the residential market both reflect a strong history, with the price-to-rent ratio teetering on the top edge favorability for renters. That means residential renters will find it more desirable to rent than buy when they examine their finances. Beyond the numbers, the property itself should offer desirability to renters. Residential renters will look carefully at things like the suburb, available storage, and neutral decor. Evolve notes vacationers, on the other hand, search for things like a useful kitchen, wifi availability, parking, and pet-friendliness. In both cases, eye appeal will always be important, and better renters will be willing to pay more for an aesthetically pleasing environment. How Do You Attract Renters? Once you settle on a property, you’ll want to ensure it both attracts quality renters and is reasonably easy to maintain. For a vacation rental, this might mean including classic and well-made furniture, ample lighting, and a touch of luxury. For both vacation and residential properties, it should include upgrades like refreshed cabinetry, newly painted walls, low-maintenance (but well-maintained) landscaping, and hardwood floors. Selections like these will spark interest from renters while ensuring your upkeep is minimal. For example, hardwood floors will stand up far better to renter wear and tear than carpet, and they are in high demand these days. Even if renters ding it up, the average cost to refinish hardwood comes in at $3 to $8 per square foot, which is unlikely to be needed very often. On the other hand, carpet would most likely require replacement more frequently, and would look worn as soon as the first grape juice gets spilled. Per Carpet Captain, you can expect the lowest end carpet to run $1 per square foot. Of course, once your property is all prettied up, you need to get the word out about what a great location it’s in, and how beautiful and comfortable it is. BiggerPockets points out that since everyone is shopping online these days, professional photos are a must for effective property marketing. Your online listing should include all the pertinent details, such as space, amenities, parking, and pet-friendliness, and you might consider some incentives to draw your initial clientele. A bonus night or free month can make your place all the more tantalizing to prospective renters.
What Are Your Responsibilities? As a property owner, your responsibilities center around providing a functional and safe living space. That means when things break, it falls to you to ensure they get repaired in a timely manner. The more responsive you are to requests, the better chance you have of getting and keeping quality renters, too. This means late-night calls, bills from repairmen, and so forth. Some property owners elect to pass the daily grind to a property management company. These professional services can tackle everything from properly screening tenants to hiring maintenance work while you enjoy passive income. Generally speaking, you can expect to pay a property management agency between 8 and 12 percent of the monthly rent. It’s normal to have a lot of questions buzzing through your mind when you are investing a large sum of money. Take things slowly and do it the right way. That’s the primary secret in ensuring a favorable outcome with your first investment property. |
AuthorPeter has written for his local magazines, Country Zest & Style and Middleburg Life as their Wine contributor. He also enjoys writing blogs on interesting and pertinent real estate matters, so please follow! Archives
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