Considerations for Rentals with Large Yards

[Jason Pedersen]

I am new to real estate as an investor, though my wife and I are on our second home now (fortunately made a few bucks on our first purchase thanks to LA appreciation) and I have always been interested in investing in general. We are still at the strategizing phase and trying to figure out how to tackle our local market (I’m not opposed to out-of-state, but my wife doesn’t like the idea of it… but that’s besides the point!). One of our options includes turning our current house into a rental, which brings me to the point of this post…

Our house is on a large lot for the area we live in (1/3 acre). It’s one of the biggest in the neighborhood, and is the main reason we bought the house. It’s 5 bedrooms, and I’m envisioning a larger family that isn’t in a position to buy such a big property would be very happy renting for a while. We have a decent amount of grass, LOTS of trees, a gazebo, kids’ “clubhouse”, etc. (no pool!). I understand this doesn’t fit in the typical box for rental properties, so what things do I need to consider when I look ahead and plan for (potentially) making this a rental?

We currently have a gardener that comes weekly for $150/month that mows&blows + a little shrub trimming here and there. For those of you that have rentals that require some landscaping maintenance, are you paying that bill or asking the tenant to pay it in the lease? Do you go by maybe twice a year to take care of all the items the gardener isn’t taking care of, or do you look for a landscaping service that’s going to handle everything (from pulling weeds to adjusting sprinklers).

How about water bill? I haven’t done a full analysis yet, but I’d bet half of our water bill is from landscaping. How do you incentivize the tenant to water enough to maintain the health of the landscaping?

I plan to get some of our trees trimmed this winter, so I will get a good idea of how much of our rental income would need to be budgeted for that ongoing expense. Depending on what this costs me, I think it could single handedly change the viability of this property as a rental going forward!

And finally as a more general landlord-ing question, are property owners responsible for any injury a tenant (or their guests) sustain on the property? I realize this is an insurance issue, but would like to understand liability as well. If a kid trips and breaks his or her arm, am I going to be blamed for a half inch raised lip in the cement? What about a pine cone falling on someone’s head?

I know there’s a lot there. Just looking for some feedback to make sure we are considering everything. We’ve only lived here one year, so any move we make is probably a year out so we preserve the option of selling within the five year window without capital gains. Thanks!