Auburn Hills, Michigan, a beautiful Detroit suburb, has a homeownership rate of 48.6% as of 2021. That means more people rent than own their homes here.
That figure also indicates how rental property ownership in the city could be profitable. So, if you own property here that you don't live in, why not turn it into a rental unit to earn extra income?
One way to do that is to list your property for rent by owner (FRBO). We've shared insights on how this rental process works, so read on.
For Rent by Owner: What It Entails
If you, the landlord, opt for the "For Rent by Owner" route, you'll handle all the steps in the rental process. These include but aren't limited to:
- Performing a rental property analysis to establish a fair rental market value (FRMV)
- Creating a lease agreement that complies with all applicable housing laws
- Marketing and listing the property
- Communicating with potential renters
- Scheduling tours and viewings
- Thoroughly screening tenants
- Inspecting and maintaining the property
- Collecting rent
- Evicting tenants in compliance with all applicable laws
That list alone shows how involved and time-consuming the "for rent by owner" route is. Still, it gives you complete control over your property, and you won't have to worry about paying real estate agent commissions.
Potential Drawbacks of FRBO
If you choose the FRBO route, you must prepare to spend significant time and effort managing your rentals. It may interfere with your career, other business, or family.
There's also the risk of penalties and legal issues arising from non-compliance with the Michigan Landlord and Tenant Relationships Act. This Act states landlord and tenant rights and responsibilities and the penalties either party may face if they fail to comply. So, unless you're very careful, you may put yourself in the way of legal problems and even lawsuits.
The Ideal Alternative
If you want the most passive way to earn rental income, consider partnering with a full-service property management company. These pros can take on all the tasks of running your rental business in Auburn Hills, MI, including everything in the list above. Plus, they have other services that can help boost your rental profits.
For example, a full-service property manager can create an irresistible tenant incentive program. That can help you retain your best renters and encourage them to renew their lease.
You can also rest easy knowing that reputable property managers can help with evictions. Their eviction protection plans can safeguard you from the stress and cost of evictions.
Start Earning Passive Rental Income
As this guide explains, the "For Rent by Owner" route gives you complete control over your rental properties. However, you must also prepare to commit time, resources, and effort, as you'll decide on and do everything.
If you don't have time for all of that, consider partnering with PMI Great Lakes. Our full-service property management company can assist you throughout the rental process, from marketing to tenant screening, rent collection, and property maintenance. We also provide eviction protection plans, with coverages of up to $2,000.
So, contact us today! We'll happily discuss how we can help you earn rental income in the most passive way possible and even give you a free rental analysis.
