Becoming a landlord in Alberta can be a lucrative and rewarding decision, as long as you cover a few important bases beforehand. These include understanding the law as it relates to your rights and responsibilities as a landlord, doing your research and considering market conditions before purchasing acreages for sale in Alberta or an Alberta Grazing Lease For Sale.
Understand The Law
If you are purchasing land and intending to rent out a residence, the Residential Tenancies Act (RTA) is a law that dictates the rights and responsibilities that apply to landlords and tenants. To clarify the details related to the RTA, the government of Alberta published this consumer tips sheet for an overview of the rules and rights that apply to landlords throughout the province. According to the law, a landlord may be an individual, a group of people, or a corporation. The RTA states that to qualify as a landlord, the individual or entity must meet one of the following criteria:
- the current or new owner of the rental premises
- the property manager who acts as an agent for the owner
- the person who rents out the rental premises
- any person other than the owner who falls within the definition of a landlord in the Act
Note that if a property manager acts as an agent for you as a landlord, that manager must have a license from the Real Estate Council of Alberta (RECA). This will allow the property manager to lease, negotiate, and approve the rental of real estate, as well as collect rent, hold rent, and advertise the property.
Research Before Purchasing
To succeed in the rental market, you’ll need to conduct research before purchasing the property, whether it’s an Acreages for sale in Alberta, Alberta Grazing Lease For Sale, or Alberta farms for sale. Without this research, you could end up making a purchase that fails to have the potential for cash flow under present market conditions. As you research, focus on the following questions:
Is it within my budget?
It’s important to understand before you invest in a property that even if the property you purchase sits vacant, you’ll still be responsible for mortgage payments, utilities, and property taxes.
Additionally, keep in mind that being a landlord involves many additional expenses, including:
- Landlord insurance for accidents, sudden loss, and liability
- Maintenance and repair costs
- Rental licensing, mandatory inspections, and annual registration fees
- Property and rental income taxes.
- Bookkeeping or accounting fees (if you don’t do them yourself)
- Property management fees (if you choose to hire a property manager)
- Legal fees for lease review and in the event of an eviction
Does the property offer a high return on investment?
What sort of repairs would be needed to make the property habitable or viable for farming?
Is there a demand for a rental property of this type?
What can I expect to get in rent for this property?
This amount is completely market-driven and can best be researched by looking at the current rental market in the immediate area of your investment property.
Ready To Purchase
Whether you are a current landlord looking to invest in additional properties or deciding to become a landlord for the first time, it helps to have professionals in your corner that can help you find the perfect investment. Our brokers at Hansen Land are experts in the market surrounding an Alberta Grazing Lease For Sale, Acreages For Sale in Alberta, and Alberta Farms For Sale. We are here to help you make all the best decisions when wanting to buy or sell land in Alberta! Contact us today for more details.