5 things to keep in mind when you have a house for renting

In addition to good profitability, renting is also risky. In this article, Realestatevietnamwill tell you 5 things to keep in mind when renting.

Note when giving rental rates

First, you need to base on the factors: the location of the house / apartment (direction, floor), the area, the status of the interior, the advantage of business or representative office or not … to determine the real value of the apartment / house. Then, you can refer to the rental rates in the market or nearby areas; Expenditures for periodic inspections and upgrades, maintenance and repair of utility equipment as and when required, then setting a reasonable rental rate.

The current rental market is also entering the competition, so you can offer a softer price than the general average to attract customers and get long-term leases. Given the price too low compared to the market, it could have a negative impact on the rental market. Often, homeowners will rely on the inflation index of the currency and commodity price index in the market to adjust the annual rent, so you do not need to worry about the compensation for the loss of the price. initial hire. If you do not know how to set the price, you can look to real estate brokers for specific support and advice.

Before renting a home, you should identify the right tenant

You need to identify the tenant that you are targeting to facilitate the search. If you rent a flat or a low-cost apartment, it is suitable for single occupants or office workers; If you rent a luxury apartment, newlyweds, good earners or foreigners will be the object you should look for; If you want to rent a shophouse, small businesses or startups will be your priority.

When dealing with people who come to see your home, pay attention to their honesty, ask more questions for more information about them and then pick out the most suitable tenants among them. When renting, you should also clarify the number of people living in order to facilitate the management.

Notes when conducting transactions

For renting, you need to pay attention to tenant regulations and rigidity in your tenancy agreement so that you can lease them as long as possible and avoid the risks that may arise. First, you need to ask the customer to deposit a rent for a certain period of time (1-3 months) to ensure that they are able to afford the monthly rent. This amount can also be used to offset the penalty if the tenant breaches the contract.

Next, you need to inform your tenants of the rules of living, interior use and environmental sanitation, security and order as well as compliance with applicable law. The clear notices will help the tenants determine the rights and obligations they need to make.

When renting, you need to ask the tenant deposit

As far as the signing of the lease is concerned, the terms should be detailed and detailed, especially in terms of how to deal with potential violations so that they can be easily dealt with. born later. And if the lease is 6 months or more, the contract must be certified by the notary public to ensure the legality and can serve as a basis for dispute settlement later. Along with that, you should note the following:

• Specify the amount of rent in Vietnam dong because according to the law is not negotiable in foreign currency, if you do not note this will cause the contract to be invalidated.
• Make a clear agreement on who will pay the monthly tax.
• If the contract is for 5 years, the agreement can be renewed for one to two years, usually between 10 and 15%.
• The contract must specify whether the tenant is allowed to rent a room or a house. You should mention that the tenant does not have the right to change the structure of the house without the consent of the landlord.

Notes about tax regulations

When renting, you need to pay attention to the taxes to avoid trouble later

If you want to rent, one of the most important things you need to know about paying taxes. According to the latest regulations on tax, if the annual rent is less than VND 100 million, the lessor is not subject to value added tax; with the annual rent of VND100 million or more, the landlord must pay the following taxes:

– Excise tax: depends on the time of signing the lease. Specifically:

+ If the first 6 months: VND1 million / year.

+ If it is 6 months last year (from July 1): only pay 500 thousand.

– Value added tax: payable tax amount = turnover x 5%.

– Personal income tax:

Payable amount = [(Turnover x 30%) – Deductions] x Tax rate (%)

As such, however, you and the tenant can agree on who the person directly submits the taxes and which should also be included in the contract or annex of the lease. In order to obtain accurate and detailed information, you can go to District Tax Department for detailed instructions.

Other issues to consider

In order for your tenancy to go smoothly as well as helping your tenants to settle down, you need to complete the following tasks. After signing the lease agreement, you need to come to District People’s Committee to register the business of individual house rental; to the administrative police department for social order to make a commitment to ensure security and order and finally to the Ward police to declare temporary residence for tenants. Please note that the person who commits the above procedure must be the owner of the home and the person signing the lease. In the case of someone else doing the work, you must make a power of attorney certified by a notary public.

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