Let's follow a scenario where someone bought their first home in Austin and then had to relocate to another city, leaving the house to be rented out. Since it was shortly after purchasing the home, selling it felt disappointing, and leaving it vacant was not an option due to mortgage repayments. There was also the thought that they might return in a few years, and the idea of paying down the mortgage principal with the tenant's rent was appealing. So, they chose to rent it out.

The first concern is, of course, how much to set the rent. As of July 2026, the average rent for a one-bedroom in Austin is $1,540 per month, while a two-bedroom is $2,020 per month (Zumper). This is similar to or slightly above the national median. It's best to use these figures as a guideline, but checking a few actual listings that have successfully rented in the same neighborhood will provide more accuracy. Setting the rent too high can lead to longer vacancy periods, which can be more costly, while setting it too low reduces the opportunity to thoroughly review applications.

Once the rent is set, it's time to find tenants. Posting photos and details on Zillow Rental Manager or local rental platforms is standard practice. The more specific you are about the room layout, parking, pet policies, and nearby school information, the better the quality of inquiries you will receive. This household reported that inquiries increased after they uploaded a few new photos taken during the day. They also pre-scheduled several time slots for showings and decided to review applications in the order they were received when inquiries overlapped.

When inquiries come in, screening begins. This involves checking credit scores, income verification, and previous rental history. Many landlords use a guideline of income being around three times the rent. It's also common to contact previous landlords to inquire about rent payment history. The more thorough this process is, the fewer difficulties you may encounter later. If there are multiple applicants, it's advisable to apply the same criteria to everyone and keep a record of the reasons for your decisions.

The lease agreement should clearly outline the rent amount, payment dates, security deposit, pet policies, and repair responsibilities. It's also wise to establish guidelines for utility responsibilities, notice periods for landlord access, and renewal procedures after the contract expires. For those renting out their first home, it's best to draft this section using a standard template and double-check for any missing items.

In Texas, there is no maximum limit on the security deposit according to state law. However, landlords must return it within 30 days after the tenant moves out or provide a written statement of deductions. If this deadline is not met, the landlord may owe the tenant $100 plus three times the amount of the deductions, so it's advisable to mark this date on your calendar. It's also good to know that allowable deductions are limited to unpaid rent and repair costs for damages beyond normal wear and tear.

If rent is overdue, sending a three-day eviction notice is standard. However, starting January 2026, a new provision requires landlords to send a notice to pay or vacate to tenants with no prior late payment history, so it's wise to keep track of the tenant's previous payment history. If the notice period passes without the tenant vacating, legal proceedings will be necessary.

This household took photos of various areas of the home on the day the tenant moved in. For first-time landlords, this small habit can be a great help when settling the security deposit later. Regular homeowners insurance may not cover all tenant-related damages, so it's advisable to look into rental property insurance as well.

Tax laws and rental regulations can vary by county. This article is not investment or legal advice, and it's recommended to consult with a professional before finalizing any contracts.