Real estate investing involves the ownership, management, purchase, rental or sale of a real property for profit. It is one of the best ways to boost your investments. One of the most used strategies in real estate investment is rental property management or what is commonly known as leasing.

Leasing is when you rent out your property to other people for a fixed amount and for a certain period of time. This strategy is considered as a source of passive income. It is called a “passive income” because you let your property work for you by generating income without you exerting direct effort unlike having a full-time job or managing a business. All you have to do as the landlord is wait for the rental payment to be remitted by your tenant.

If you are interested in venturing into the business, here are some guides in making your property work for you.

First things first: let us learn some terms new landlords should be familiar with.

  • A landlord is called the lessor or the one who leases the property. He/She is the owner of the property. Under the Civil Code of the Philippines, it is his/her duty:
    • To lease the property in such a condition that it is suitable for occupancy
    • To make all necessary repairs in order for the property to be suitable for occupancy
    • To make sure that the lessee is in the peaceful and adequate enjoyment of the lease for the entire duration of the contract. Also, if the property of the landlord is totally destroyed by unseen events such as typhoons, earthquakes,fires,flooding etc. the lease will be extinguished. However, if the destruction of the property is only partial, the lessee may choose between a proportional reduction of the rent or terminating the lease.
  • A lessee or commonly known as the tenant is the person who will be leasing the property. Under the Civil Code, the obligations of the lessee include:
    • To pay the price according to the terms stipulated in the lease contract.
    • To use the property for the purpose indicated in the lease contract and keeping it in good condition for the entire duration of the lease.
    • To pay the expenses for the deed of lease.
    • To turn over the leased property to the lessor upon the termination of the lease.
  • The rental payment or rent is the agreed amount for leasing the property. It is the passive income of the landlord from the property. This passive income of the landlord must be declared for tax payment purposes.
  • The lease contract contains the names of the parties, the amount of the rental payment and the duration of the lease agreement, and some conditions that are imposed by the landlord and agreed upon by the tenant during the duration of the lease agreement. In case one party wants to change some conditions on the contract, he/she must get the approval of the other party.


Knowing these basic terms also requires understanding your duties and responsibilities under Philippine laws, local ordinances, and the condominium rules, if the property involved is a condo.

Here are 16 landlord tips to get you started with your passive income:

  1. 1. Study the market, and the ins and outs of the business.
  2. 2. Market your property.
  3. 3. Screen your possible tenants well.
  4. 4. Execute a lease contract.
  5. 5. Build a good relationship with your tenant.
  6. 6. Be open to arrangements on rental payments.
  7. 7. Impose advance payments.
  8. 8. Demand security deposits.
  9. 9. Maintain your property in good condition.
  10. 10. Be transparent with your tenants on the payments of bills.
  11. 11. Pay your taxes on time.
  12. 12. Always keep a logbook or a record.
  13. 13. Exercise your right to evict tenants.
  14. 14. Always check your property before your tenant moves out.
  15. 15. Insure your property.
  16. 16. Sign up for leasing services.


1. Study the market and the ins and outs of the business.

It is a rule of thumb to know every venture before signing up. This is similar to leasing your property. Study the market and educate yourself through market research. Get a grasp of what is happening in the real estate industry, especially how the global pandemic will affect demand and rental fees.

Doing your homework is a must because you do not want to waste your hard-earned money.

2. Market your property.

As a first-time landlord, you would want to cut costs in marketing your property. One way to market your property is through different social media platforms, property listings, online directory, and classified ads which are generally affordable— depending on how much you run ads for it.

Here are some tips to keep in mind when posting rental ads online:

  • Location, location, location - when marketing your property online, be fully aware of the location of your property. Whether you’re in a prime real estate location or not, highlight the places near your property to entice potential tenants.For instance, let people know if your property is situated near hospitals, churches, the public market, public parks or malls. It would help if you could indicate the approximate time to get into major highways and public transportation.
  • Be honest about your property - It is your obligation as a landlord to inform potential tenants of the status and condition of the leased property. Consider creating Facebook ads and post real photos. If repairs are needed, make sure your tenants know about this before signing the lease contract.You may also invite them to an ocular inspection in person or a virtual condo tour to allow them to see the property for themselves. Virtual tours are convenient when people are not available to visit in person. This is also recommended during the current pandemic and outdoor activities are discouraged.

3. Screen your possible tenants well.

In renting out a house for the first time, choosing the right tenant can be a tricky task. How do you know that someone is a responsible tenant? That you would not have troubles in collecting payments and ensuring your property is well-maintained?

Do a background check. Ask for a copy of their government-issued IDs and other documents proving their identities. You may also reach out to their previous landlords who may vouch for their character.

The main reason for screening your possible tenants is to protect your interests as a property owner. This is also a way to avoid the possibility of your tenants breaching the terms of the lease contract, or worse destroying your property.

4. Execute a lease contract.

Once you are convinced that you are renting to the right people, the next task is to execute a lease contract. In making a lease agreement you should make sure that the stipulations are legal and in accordance with the real estate law and other pertinent laws in the Philippines, and the condominium rules.

5. Build a good relationship with your tenant.

As a landlord you must always make sure that your tenants are content and happy in leasing your property. How? By checking on their well-being from time to time and asking them if they need something related to the property. Doing this will help establish good customer satisfaction and build your reputation.

Since this will be your first time in the leasing business, you may want to ask for tips and guidance from those who have been doing this for a long time. Learn how to be a good landlord from the good landlord themselves!

6. Be open to arrangements on rental payments.

This is one of the most important parts in the leasing business because this is where your passive income will come from. However, emergencies may arise and rental payments might be delayed.

As a landlord you must know how to handle situations when your tenant cannot pay their rent on time due to some unforeseen events. You may make arrangements with the due date such as setting up a grace period for late payments.

7. Impose advance payment.

Advance payments are usually equivalent to 1 or 2 months of rental payment. Requiring advance payments is a form of security on your part in case your tenant abandons the property with arrears. The common practice is that advance payments are given back to the tenant if the tenant decides to move out and there are no liabilities incurred.

The tenant can also use the advance payment to cover the payment of the last month of lease for as long as the tenant informs you beforehand.

8. Demand security deposits.

A security deposit covers the cost of repairs of the damages on the property when the lease ends. It is normal that there will be wear and tear on your property during the duration of the lease of your tenant.

It is up to you as the landlord to set the amount of the security deposit that will be imposed. The security deposit is usually given before your tenant moves in your property, or upon signing of the lease contract.

9. Maintain your property in good condition.

As a landlord you are also responsible for property management tasks like repairs of furniture and fixtures, plumbing issues, air conditioning and maintenance, and electrical repairs. By keeping track of these issues and addressing them right away, you are maintaining your property in good condition while it is occupied by your tenant. Tell your tenant to give you a call whenever they need assistance with immediate repairs.

You can also make arrangements with your tenant when it comes to the upkeep or maintenance of your property, such as allowing them to do the repairs and maintenance and simply offset the expenses incurred from their rent.

10. Be transparent with your tenants on the payments of bills.

The common practice is that utility bills (electricity, water, internet, cable, etc.) are shouldered by your tenants during their lease. Some landlords shoulder the utility bills by adding the cost on top of the rent. However, this is not advisable especially when it comes to new landlords due to the fluctuating rate of the utility bills which is hard to anticipate. It is advisable for you to be safe and practical by letting your tenant pay the utility bills.

11. Pay your taxes on time.

There are two things that are certain in this world, they say: death and taxes. As a landlord you should also be aware of the proper taxes that you need to settle. First is the real estate tax or the taxes imposed on real property. Second is the income tax or the taxes paid on your income as a real estate lessor. These taxes cannot be passed on by the landlord to the tenant; it is the landlord who settles these obligations.

12. Always keep a logbook or a record.

Keep a record to easily keep track of all payments from your leasing business. It is much better if you secure official receipts which have duplicates for easy tracking. This will also help you avoid confusions with your tenant when it comes to rents.

If you have multiple properties with different tenants, it is advisable to keep a separate record for each tenant.

13. Exercise your right to evict erring tenants.

You have the right to evict a tenant from the leased property for reasonable and legal reasons. One classic example of a valid eviction is on the ground that the tenant violated provisions of the lease contract.

Keep in mind, however, you must issue a notice of eviction to the tenant stating that he/she is being evicted on the property and state the reasons. These steps are essential in observing due process and giving the tenant a chance to find a new place to live.

14. Always check your property before your tenant moves out.

When your tenant decides to move out, remember to check the condition of the leased property before clearing the tenant of liabilities. Is the property in the same condition when it was rented out, or are there damages beyond wear and tear? If the property includes appliances and furniture, inspect every item for any damage or loss.

It is also important that you or a representative is physically present when your tenant is moving out. This is to check the condition of the property, and the appliances and furniture (if furnished), in the presence of the tenant. If repairs are needed, inform the tenant that the cost will be deducted from the security deposit. Any excess shall be shouldered by them.

15. Insure your property.

As a property owner, consider getting your property insured. Check out insurance companies that offer discounted packages.

A property insurance provides protection against financial loss in the event the property is damaged beyond simple repairs.

If you are leasing out a condo, the insurance shall cover the contents in the unit. In this case, the tenant or the owner of the personal properties will be securing the insurance.

16. Sign up for leasing services.

If after reading this landlord guide you still feel that you cannot handle the intricacies of being a landlord, you may still proceed with the help of professional leasing services. The leasing company will take care of marketing your property, screening possible tenants, executing the lease contract, collecting rent, maintaining the property, and other related tasks. Contact DMCI Homes Leasing Services to know more.

Key takeaways

Leasing a real estate property is a sound investment worthy of your time and effort. But before diving in, make sure you have done your own research. Here are some points to ponder before venturing into the business:

  • Know the market and educate yourself. Ask for guidance from veteran landlords or leasing companies. You do not want to waste your money if you are not prepared to enter unknown investments.
  • Screen your tenants well. It is important to screen your tenant for your security and the security of your property.
  • Pay your taxes on time to avoid hassles and legal problems. The charges and penalties will directly affect our income if you fail to pay your taxes on time.
  • Avail of leasing services. Owning a property is time consuming. Acquiring the service of a leasing service company can make your life easier. It will take care of your property on the administrative aspect, maintenance and in marketing your property for the right tenants.


Contact DMCI Leasing to know about the benefits of signing up for their leasing services.