Renting a home ... What to know when signing an agreement with a realtor

[Helpinvesting]

I own a house in AZ and my tenant is moving out on July 1st

First time that I go through this. I'm about to sign an agreement with a realtor to rent the property, she is charging 6%

Anything I need to know before signing ??


Thank you for your help

[richard johnson]

I think, you need a real estate lawyer that can review your agreement and can help ensure that your agreement does not contain any illegal provisions, while also protecting you from the financial harm that could result from tenants exploiting loopholes in your agreement. A good lease agreement will specify the ways tenants can and cannot use the property, how many people can occupy the rental, what insurance is required, who is responsible for paying utilities, and what will happen if the tenant doesn’t uphold his or her obligations.

[SavingSteve]

Before you sign take a day or two to educate yourself about rental lease agreements and the laws in your state.

6% of what? If it's 6% of one years rent and the amount is split between two agents, that is very reasonable in my opinion. Even if they take the entire 6% it seems reasonable to me. Think about how much effort it takes to rent that place and the dollar amount at 6%.

[AnotherReader]

I own rentals in Arizona and I pay 8 percent of collected rents for full property management. That includes filing the sales tax returns that are necessary because there is sales tax on rentals in most jurisdictions. I would not pay 6 percent of the anticipated rent for someone to find a tenant. What if the tenant leaves after a few months? You have to pay again.

For reference, I know an agent that charges a flat fee of $750. If the tenant leaves before the year is up, she will find a replacement for free. That's incentive for the agent to find a good tenant.

In addition, you have to agree on tenant qualifications. You don't want the agent placing a tenant with a credit score of 550 and a history of criminal activity in your property.

[Helpinvesting]

I own rentals in Arizona and I pay 8 percent of collected rents for full property management. That includes filing the sales tax returns that are necessary because there is sales tax on rentals in most jurisdictions. I would not pay 6 percent of the anticipated rent for someone to find a tenant. What if the tenant leaves after a few months? You have to pay again.

For reference, I know an agent that charges a flat fee of $750. If the tenant leaves before the year is up, she will find a replacement for free. That's incentive for the agent to find a good tenant.

In addition, you have to agree on tenant qualifications. You don't want the agent placing a tenant with a credit score of 550 and a history of criminal activity in your property.

Thank you for all the information !!

[AnotherReader]

The Phoenix realtors' association has a standard lease form. Agents that are not property managers often use the association form. Almost all property management companies use their own leases. They are more detailed and cover items not in the standard lease.

Finding good property management is a challenge. Stick with companies that have been in business for many years and get independent references if you decide to go with full management. A lot of newer companies started when the bottom fell out of the resale market and agents were looking for something to generate income. They tend to get sold or go out of business when the resale market picks up because property management is time consuming and does not pay that well.