Having a rental property can be a great way to add some supplementary income to your pocketbook. When that rental property is in a community with an HOA, it offers a lot of advantages for both you and your tenants, like keeping property values high (which benefits you) but also keeping community areas nice (which is great for tenants). But before you jump into the landlord role in an HOA community, there are a few things you need to be aware of:

Check for Rental Restrictions

Some HOAs in some parts of the country may not allow owners to rent their properties to tenants, or they may limit the number of rental properties that are allowed in the community. If you’re interested in purchasing a property for the sole purpose of renting it to tenants, be sure to double check the community HOA bylaws to make sure they don’t conflict with your investment plan. If you already own the property and are interested in renting it out instead of selling, it’s also a good idea to double check…even if you already think you already know the HOA rules.

Ultimately, You’re Responsible

Even though your tenants will actually be living in the HOA community, technically as the landlord you are still responsible for ensuring that rules are followed and dues are paid. If your tenants continually fail to follow the rules, you as the homeowner will be the one who is fined. Or even worse, the person who the HOA could take legal action against if the problem isn’t corrected. That said, it’s always a good idea to include HOA rules in your lease agreement and also carefully screen potential tenants to and try to select those who seem more prone to following the rules of the community (and will make your life much easier!).

Protect Yourself in the Fine Print

You can never be too careful or too detailed when it comes to outlining expectations, obligations, and even grounds for eviction in your lease agreement. Too many landlords make the mistake of not being thorough enough in their lease agreement and end up in a financial or legal mess when tenants don’t end up doing what the landlord “thought” they knew was expected of them. Do yourself a favor and invest the time and resources into creating an iron-clad lease agreement that protects yourself and helps maintains the integrity of the HOA community.

Related: Xeriscaping and Your Texas HOA Community

When it’s managed correctly, a rental property in an HOA community can be a win-win situation for both owners and tenants. We hope these three tips help you make the best decisions for your rental property! For more information about our refreshingly different HOA Management services, contact Spectrum today!