How to Rent Out Your House: A Beginner's Guide for Landlords

Last Updated: September 28, 2023 by Jessica Menefee

Relocating, downsizing, or earning extra income are all reasons you might rent out your home. Doing so can be a wise financial strategy, but it takes careful planning.

From navigating legal obligations to finding reliable tenants and setting a fair rent price, many first-time landlords quickly realize there’s more to the process than just listing a property and collecting checks.

Fortunately, with the proper steps, you can turn your home into a steady income without a lot of stress. In this guide, we’ll cover 15 key steps to rent out your house, including how to prep the property, advertise, screen tenants, and manage the lease.

You’ll also find frequently asked questions, helpful tips, and free tools to make the process easier from start to finish.

Is Renting Out Your House Right for You?

15 Steps To Renting Out Your House

Here are the steps to renting out your house:

1. Establish Rental Eligibility
2. Determine Rental Type
3. Understand Profitability
4. Consider Hiring Help
5. Learn Landlord-Tenant Law
6. Get Rental Ready
7. Obtain Needed Documents
8. Stage Your Space
9. Determine How Much To Charge For Rent
10. Write an Enticing Rental Listing
11. Advertise Your Rental Property
12. Complete Tenant Screening
13. Sign the Lease and Collect the Security Deposit
14. Set Communication Procedures
15. Document Everything

1. Establish Rental Eligibility

Before renting out your house, ensure you’re legally permitted to do so. Some properties face restrictions based on their location, mortgage type, or the rules of their homeowner association (HOA). Skipping this step could result in fines, legal action, or being forced to remove a tenant early.

Here’s what to check:

Mortgage restrictions: If you have an FHA, VA, or USDA loan, there may be limits on how soon you can rent out a house with a mortgage. Some loans require the property to remain your primary residence for a specific period.

HOA or condo rules: Many communities, especially condos, have specific leasing rules outlined in their HOA or COA (Condominium Owners Association) documents. If you’re in a condo, you’ll need to look at the bylaws and CC&Rs to know if renting is allowed and under what terms. And keep in mind—those rules aren’t set in stone. A majority vote could change them down the road.

Zoning laws: Local zoning ordinances may restrict certain types of rentals, such as short-term leases, accessory dwelling units (ADUs), or subletting parts of a home.

Insurance coverage: Standard homeowner’s insurance may not cover rental activity. You’ll likely need to upgrade to landlord insurance, which protects against tenant-related damage and liability claims.

Not sure about the local rules? A quick call to your city’s planning office or a chat with a real estate attorney can clear things up and keep you out of trouble. Once you know your place is legally approved for rentals, you can take the following steps with peace of mind.

2. Determine Rental Type

Not all rentals are alike. The type of rental you choose will shape everything from your lease terms to how you market the property. Begin by determining the kind of rental arrangement that best aligns with your goals and your home.

Common rental types

• Long-term rental: A traditional 6–12+ month lease where the property is the tenant’s primary residence. It is ideal for a stable income and less frequent turnover.
• Short-term rental: Nightly or weekly rentals, such as Airbnb. These often generate higher rent but require more hands-on management.
• Month-to-month rental: Flexible arrangements that renew every month. These options appeal to tenants who don’t want to commit to long-term leases, but they can result in more frequent turnover.
• Room rental: Renting out individual rooms while sharing common spaces. Popular in college towns or urban areas, but may require more detailed agreements. Read more about the rules for renting out a room.
• Accessory Dwelling Unit (ADU): Renting out a basement, guest house, or converted garage. Be sure to check zoning laws before advertising. Here’s what to know before renting out your basement legally.

Questions to ask yourself:

• Do you want long-term stability or short-term flexibility?
• Do you plan to furnish the property, or leave it unfurnished?
• Are you living on-site, or will tenants have full access to the home?
• Does your city or HOA restrict certain types of rentals, such as short-term leases?

If you’re a first-time landlord, long-term leases are typically the easiest and most reliable way to start.

3. Understand Profitability

Before you rent out your house, make sure the math adds up. It’s not just about collecting rent; it’s about ensuring that the income you receive each month exceeds the expenses, so you’re actually making a profit.

Start with your monthly costs:

• Mortgage payment
• Property taxes
• Homeowner’s or landlord insurance
• HOA dues (if applicable)
• Utilities (if you plan to cover them)
• Maintenance and repair costs
• Property management fees (if hiring help)

Next, estimate your rental income:

• Research comparable properties in your area using sites like Zillow, Redfin, or Realtor.com.
• Consider seasonal trends or market demand in your neighborhood.
• Use this formula to calculate cash flow: Monthly rent – Monthly expenses = Cash flow.

Positive cash flow simply means your rental is bringing in more money than it costs to own, so you’re actually making a profit. However, if your expenses exceed rental income, you may need to adjust your rent price, upgrade certain features, or revisit your readiness strategy.

Other key factors that affect profitability

• Vacancy rates: Budget for 1–2 months of vacancy per year.
• Turnover costs: Cleaning, repairs, and advertising between tenants can quickly add up.
• Tax considerations: Rental income is taxable, but you may also qualify for deductions on mortgage interest, depreciation, repairs, and other expenses.

4. Consider Hiring Help

Renting out your house can be a hands-on responsibility or a hands-off investment, depending on how much help you bring in. Before you go it alone, think about where professional support could save you time, stress, or legal headaches.

Common services landlords hire out

Property management companies: Handle rent collection, maintenance requests, tenant communication, inspections, and lease enforcement. A good property manager can take most day-to-day tasks off your plate.

Real estate agents: Help list your property, host showings, and screen applicants. They can also assist with setting a competitive rent price based on market data and comps.

Are you unsure if you need an agent? Ask yourself:

• Can I effectively advertise my property?
• Am I confident in pricing it accurately?
• Do I know how to screen tenants properly?
• Do I have time to manage these tasks?

If you answered no to one or more, an experienced agent may be a worthwhile investment, especially if you’re renting your home for the first time.

Accountants: Ensure accurate tax filing, track rental income, and help you maximize deductions.

Real estate attorneys: Assist with lease agreements, eviction procedures, and compliance with local regulations.

When hiring help makes sense

• You don’t live near the property.
• You don’t have time to manage day-to-day tenant issues.
• You’re unsure about local landlord-tenant laws.
• You want to scale your rental business without adding more hands-on work.

These services typically come at a cost (usually between 8 to 12% of monthly rent for property managers). However, many landlords find the investment worthwhile if it helps avoid expensive mistakes or vacancies.

5. Learn Landlord-Renant Law

Before you rent out a property, take time to understand your legal responsibilities. Laws at the federal, state, and local levels set rules on everything from security deposits to fair housing, and failing to follow them can result in expensive fines or lawsuits.

Key legal topics to familiarize yourself with

Fair housing laws: It’s illegal for landlords to discriminate based on race, color, sex, religion, national origin, disability, or family status. In some states, there are also protections for sexual orientation, source of income, or criminal history.

Required disclosures: Some states require landlords to provide written disclosures about lead-based paint, mold, smoking policies, bedbugs, flood zones, or other health and safety issues.

Security deposit rules: State laws typically regulate the amount of a deposit, where the funds will be, timeframes for returning security deposits, and the conditions under which deductions can take place.

Rent control laws: Some cities and states limit how much you can raise rent and how often. Rent control laws may also regulate when and why you can terminate a lease. Check your local housing authority or rent board to understand any restrictions that may apply to your property.

Lease agreement requirements: Your lease must comply with local laws around rent due dates, notice periods, late fees, entry requirements, and termination procedures.

Maintenance obligations: Landlords are legally required to maintain the home in a habitable condition. A habitable condition includes functioning plumbing, heating, and electrical systems, as well as prompt resolution of pest infestations or safety hazards.

Eviction laws: You can’t evict a tenant without cause or due process. Legal evictions require proper notice and must follow strict court procedures.

Note: Review your state’s landlord-tenant laws or consult a local attorney for personalized advice. Understanding the law now can help you avoid costly legal battles later and give you more confidence as a landlord.

6. Get Rental Ready

7. Obtain Necessary Documents

Renting out your house legally and efficiently starts with gathering the proper documents before listing or leasing. Having all the correct documents on hand not only protects you as a landlord but also sets clear expectations for your tenants.

Documents to prepare

Proof of ownership: You may need this when setting up utility accounts, applying for landlord insurance, or verifying your authority in legal matters.

Landlord insurance policy: Homeowners insurance isn’t enough when you’re renting out a property. Landlord insurance is built for the job, covering things like rental income loss, tenant damage, and liability claims.

Local permits or licenses: Some cities or states require landlords to register rental properties or obtain business licenses. Reference your local housing laws to stay compliant.

Rental application form: A standard rental application gathers key info from potential tenants, such as employment history, income, references, and consent for background/credit checks.

Tenant screening documents: Prepare forms for background checks, credit reports, and employment verification. Always get written consent from applicants.

Lease agreement: Use a state-specific lease agreement that complies with local laws and clearly outlines the terms, including rent amount, due date, security deposit, pet policy, maintenance responsibilities, and other relevant details.

Lead-based paint disclosure: Federal law requires you to inform tenants of any known lead-based paint hazards if your property was built before 1978.

Save both digital and paper versions of your rental paperwork. Doing so makes life easier to stay organized and could save you a significant headache if a dispute comes up.

8. Stage Your Space

First impressions matter, especially in today’s competitive rental market. A well-staged home can attract more qualified applicants, justify a higher rent, and reduce vacancy.

Tips for staging your rental

Clean thoroughly: Tidy up every room so it’s spotless. Focus on the kitchen, bathrooms, and floors, and consider professional help for carpets or upholstery.

Declutter and depersonalize: Remove personal items, extra furniture, or anything that makes the space feel too crowded. The goal is to help prospective tenants imagine themselves living there.

Focus on curb appeal: Keep the yard in shape by mowing the lawn and trimming the hedges. Clean up the entryway, and a little fresh paint on the front door can really boost curb appeal.

Make minor repairs: Fix leaky faucets, loose handles, squeaky doors, or cracked tiles. Even minor improvements can make a significant impact on how “move-in ready” the home feels.

Add warm, neutral touches: Open curtains to let in natural light, use soft neutral tones for walls, and consider adding accent lighting or simple decor to make the space feel inviting.

Include a clean, modern setup that appeals to the broadest possible audience if you decide to provide a furnished rental.

Staging doesn’t have to be expensive. Aim for a space that feels clean, cared for, and inviting. With just a few simple changes, you can attract renters more quickly and possibly get a higher rent.

9. Determine How Much To Charge For Rent

Pricing your rental correctly is one of the most critical steps in attracting tenants and ensuring steady income. Setting the rent too high risks long vacancies. Too low, and you risk leaving money on the table.

How to determine your rent price

Research local listings: Check platforms like Zillow, Redfin, and Realtor.com to see what similar homes in your area are renting for. Consider factors such as square footage, number of bedrooms/bathrooms, amenities, and location.

Use rent estimation tools: Not sure what to charge for rent? Online calculators and rent estimate tools can give you a quick idea. HUD also publishes Fair Market Rent data each year, based on Census info and other research. It’s mainly for affordable housing programs, but it can still be a handy benchmark when you’re setting your rental price.

Factor in your expenses: Don’t forget to add up all your costs—mortgage, taxes, insurance, utilities you pay, upkeep, and management fees. Your rent needs to cover those and still give you some profit on top.

Adjust for condition and features: Homes in excellent condition or with features like in-unit laundry, updated kitchens, or included utilities can justify higher rent.

Review rent control laws: If your property is in an area that has rent control or rent stabilization ordinances, such as parts of California or New York, check local regulations before setting your rent.

Always include your rent amount in your listing description and ensure it aligns with the terms of your lease agreement to avoid confusion or potential legal issues.

Setting the rent isn’t something you do once and forget about. Check in on the market periodically and adjust as needed. A fair price makes it easier to find tenants quickly—and keep them around.

Rent Concessions and When To Offer Them

A rental concession is a special offer from a landlord or property manager to entice potential tenants to sign a lease.

Rent concessions come in many different forms, including:

• A month of free rent
• Gift cards
• Moving assistance
• Yard maintenance services
• Access to amenities
• Property upgrades

While offering a rent concession may cost you upfront, filling a vacancy more quickly will likely pay off in the long run. You can also use a rent concession to:

• Maintain a good tenant
• Market an older property
• Fill a luxury unit
• Establish yourself or your property on the rental market

10. Write an Enticing Rental Listing

After your home is prepped and priced, focus on creating a listing that stands out. Highlight the best features, keep the details clear and accurate, and let renters know exactly what they’re getting.

What to include in your rental listing

Headline that grabs attention: Lead with the most desirable feature (e.g., “Pet-Friendly 3BR Home with Backyard in Midtown”).

Basic details: Include number of bedrooms and bathrooms, square footage, rent price, security deposit, lease terms, and move-in date.

Location highlights: Mention nearby schools, parks, public transportation, shopping, or restaurants —anything that enhances the area’s appeal.

Unique features: Emphasize upgrades such as hardwood floors, stainless steel appliances, in-unit laundry, a fenced yard, or off-street parking.

Pet and smoking policy: Clearly outline what is and isn’t allowed to prevent unqualified applicants.

High-quality photos: Listings with bright, well-lit images get far more clicks. Include every room, the exterior, and key amenities.

Clear call to action: Let renters know how to apply or schedule a showing.

Your listing is your first impression. Invest time into making your rental listing description accurate and appealing to increase your chances of attracting the right tenants quickly.

11. Advertise Your Rental Property

Creating an excellent listing is just the start; now you need to get it in front of the right renters. Advertising your rental property effectively helps you fill vacancies faster and avoid long periods of lost income.

Where to advertise your rental

• Online rental listing sites: Post to popular sites like Zillow, Realtor.com, Apartments.com, and Rent.com to maximize exposure.
• Social media: Share your listing on local Facebook groups, community pages, or your personal network to tap into referrals.
• Local bulletin boards: Libraries, coffee shops, and community centers often have physical boards where you can post flyers.
• Word of mouth: Let friends, neighbors, and colleagues know your rental is available. Referrals can bring reliable tenants.

Tips to make your ad stand out

• Respond promptly to inquiries.
• Offer flexible showing times.
• Keep your listing updated with availability status.

12. Tenant Screening

Tenant screening is another crucial step when you rent out your house. A thorough screening process helps you find reliable tenants, reduce turnover, and prevent issues such as late rent or property damage.

What to include in your screening process

• Rental application: Collect details like income, employment, rental history, and references.
• Credit check: Look for a strong credit score and payment history to estimate financial responsibility.
• Background check: Screen for criminal records, prior evictions, or other red flags that may impact your rental.
• Income verification: Ask for recent pay stubs, bank statements, or employment letters. A standard guideline is that the monthly income should be at least three times the rent.
• Reference checks: Call previous landlords and employers to explore their reliability and behavior.

Be consistent and compliant. Use the same screening criteria for all applicants, and remember Fair Housing laws to prevent discrimination.

Make screening easier 

Free tenant screening reports include a comprehensive background, credit, and eviction check, all handled online with no additional cost to the landlord.

13. Sign the Lease and Collect the Security Deposit

Once you’ve found the right tenant, lock it in with a lease and collect the security deposit to make it official.

Lease Agreement Essentials

Make sure your rental lease agreement is legally compliant and tailored to your state’s landlord-tenant laws. A solid lease should include:

• Names of tenant(s)/landlord(s)
• Lease start and end dates
• Monthly rent amount and due date
• Security deposit amount and conditions for return
• Late fees and grace periods
• Maintenance responsibilities
• Pet policy, guest limits, and other house rules
• Utility payment breakdown

Use a state-specific lease agreement to avoid potential legal issues.

Security Deposit Best Practices

• Collect before move-in, typically equal to 1 month’s rent.
• Provide a receipt and store the deposit according to your state’s laws (some require separate escrow accounts).
• Document the property’s condition before move-in with a checklist and photos. Having this documentation will protect you if you need to deduct for damages later.

A well-executed lease helps set expectations, enforce rules, and avoid misunderstandings.

14. Set Communication Procedures

Clear communication keeps things simple for both you and your tenants. Set expectations from the start, stay consistent, and whether you’re managing the place yourself or using a property manager, you’ll avoid a lot of headaches and keep the relationship positive.

What to Cover

• Preferred communication methods: State whether you prefer email, text, phone calls, or a property management portal for non-emergency communication.
• Emergency contact protocol: Provide instructions for urgent issues (e.g., water leak, gas smell) and include backup contacts in case you’re unavailable.
• Response times: Set expectations for how quickly you’ll respond to maintenance requests and general questions.
• Routine check-ins: Consider scheduling regular, non-invasive check-ins (e.g., quarterly walkthroughs) to stay on top of maintenance and tenant satisfaction.

When you keep communication clear, everyone’s less frustrated, trust grows, and it’s easier to make sure nothing important gets missed.

15. Document Everything and Go The Extra Mile

As a landlord, good records are your safety net. If there’s ever a dispute over rent, repairs, or even a legal issue, having everything documented gives you the backup you need to protect yourself and your property.

What to Document

• Signed lease agreements: Keep a copy of the signed lease and any addenda. Digital backups are also a smart move.
• Rent payments: Use a rent ledger to track payment dates, amounts, methods, and any outstanding balances.
• Maintenance and repairs: Log requests, dates of service, costs, and contractor details. Having a maintenance record proves you’ve addressed tenant concerns responsibly.
• Inspections and communication: Document all property inspections and save records of written communication with tenants (emails, texts, notices).
• Deposits and deductions: Keep receipts and notes related to the security deposit, especially if deductions happen at move-out.

Frequently Asked Questions About Renting Out Your House

How much can I charge to rent out my house?

Setting rent isn’t one-size-fits-all. It comes down to where your home is, its size, condition, and the current market conditions. Look at nearby rentals to get a baseline, then weigh your own costs, including the mortgage, property taxes, and maintenance.

How difficult is it to rent out your home?

Renting out your house involves preparation and ongoing management. You’ll need to screen tenants, create a lease, collect rent, and handle maintenance. The process is manageable, but it does require time, organization, and an understanding of landlord-tenant laws in your state.

Do I need a license to rent out my house in California?

In California, some cities require landlords to register rental properties, obtain a business license, or pass inspections. Requirements vary by location, so it’s essential to check with your local housing authority to ensure you comply with any regional regulations before renting out your home.

What happens if you rent your house?

Once you rent out your house, you’re officially a landlord. That means extra income, but it also means taking care of the property, working with tenants, following the law, and dealing with leases and the occasional dispute.