As with any form of investment, there’s always risk involved. There’s always a risk in renting out your property, but often overshadowed by the allure of making some cash on the side.

If you wish to rent out your property, you’ll need to consider all side effects of leasing and take precautions to mitigate these issues from damaging your investment.

Most of these issues are created by the people you rent to and thus, you’ll need to brace yourself with any issue that follow.

1. People:
Majority of problems landlords face occur with tenants. Not all tenants are bad, but the ones who are, will make you reconsider going into property investment. Some cases could range from small issues like late payments, to larger ones where damage is caused to you unit and your tenant refuses to reimburse you for it.

There’s not much you can do except take legal action but to do this, you will need to include all caveats pertaining to property damages/payments in your contract and be doubly sure that the furniture and items in the unit were in good condition before you leased it out.

It will help if you have pictures that are hard dated to the most recent time; otherwise, it’s all just words.

2. Prolonged vacancy period:
The low time between having a vacant unit and filling it with a tenant will cost you money. If it’s a condo there will be additional fees like maintenance fees to pay. For landed units, there are always upkeeps you’ll have to take into account. Worst of all, the longer you take to find a tenant, the more costly it will be.

3. Legal liabilities:
People sue over the smallest issues these days. As long as one feels slighted to just make some money off someone as compensation, it’s now a cultural norm to sue.

However, if any accident occurs due to potentially harmful objects in your property, the tenants can sue you for negligence. This could easily be fraudulent but the weight of having legal liabilities breathing down on you is stressful on its own. Include your own terms and conditions in the contract to protect yourself and get a lawyer to advice you.

4. Profitability:
The property market swings upwards and downwards, constantly. As the market is unpredictable, it becomes difficult to determine if you can find a tenant willing to accept your price.

Lowering your rental price is an option, but it depends on your financial abilities. Can you afford to do so? Also, if the tenant has to break contract for whatever reasons, you cannot expect him to stay if he has to leave even if the contract is being broken.

Steps should be taken to protect yourself from all these possibilities from the very beginning. Put it in your contract, collect a deposit, anything to lessen the impact of something this sudden from creating a vacancy you will struggle to fill.


(中文版请看这里:http://www.durianproperty.com.my/blog/article/1160)