5 Steps to Getting a Washington DC Rental Property License

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Getting into the rental business can be a great additional source of income. When you find the right tenant, the property pays for itself and provides the opportunity for purchasing additional rental properties. This works as a great way to build a retirement fund in the future and can help provide financial stability. The only hitch is getting your DC rental property license to get started, but we’ve got you covered on understanding the do’s and don’t’s when it comes to that. Read on to discover the 5 basic steps you need to take to get started.

1. Get the Correct Basic Business License

Not only do you need to get a basic business license to rent out a rental property in DC, but you have to make sure you get the correct business license. If you choose to have multiple rental properties, then you’ll need a business license for each individual location. There are three options to choose from:

  1. One Family Rental Property License – Acting as a two-year license, this is suitable for single-family homes, duplexes, townhouses, and individual condominium units.
  2. Two Family Rental Property License – Perfect for English basement apartments or converted basement apartments. Works as a two-year license. 
  3. Apartment License – This is required for apartment buildings whether each unit is rented out or not. 

2. File a Clean Hands Certification

You can grab the application online, but each applicant for a business license must additionally submit a clean hands certification. This documents that you don’t owe more than $100 in fees, taxes, or any penalties. You’ll need to provide your tax information with the submission. 

3. Register With the Tax and Revenue Office

By submitting form FR-500 for tax purposes you can register with the Office of Tax and Revenue. You’ll need to include your business address, all names of the proprietor, and your social security number or Federal Employer Identification Number. You can locate any additional required information on the online form. 

4. Get a Housing Inspection

You have 45 days to register for a housing inspection. The inspector will write a full report determining if the home or individual units are up to code. If the property doesn’t meet all requirements or isn’t completed within 45 days, then you can lose your license and it can be revoked. You may also lose all fees already paid towards the licensing process.  

The inspection will provide documentation that your property is safe to rent out to potential tenants, and can act as proof that the property is in good condition. 

5. Register for Rent Control

​Once your Basic Business License application is approved, you need to register the property as subject to rental control or exempt from rent control. Common exemptions include buildings constructed after 1975 and people owning four or less rentals. 

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Don’t Proceed Without a License

5 Steps to Getting a Washington DC Rental Property License

Tenants have the ability to report illegal or unfair rentals, and many of them know their rights. To avoid facing penalty fines, losing potential tenants in the future, and dealing with the chance of getting sued, make sure you’ve followed the steps to getting your rental property license. This may help you in the chance a tenant reports you. It can also assist in the eviction process or going to court if they’re behind on rent.  

Filling out the primary paperwork is an easy 15-minute process, and if you follow these steps during your application you can be prepared to have this knocked out within a day. Some options will allow you to apply online and print out your basic business license for an immediate turnaround, but only if you have the proper paperwork filed and ready to submit. It can be a benefit to schedule a property inspection before you begin the process simply to save you time. 

Now that you’ve gotten all of your paperwork in order, if you’d prefer to apply in person, you can do so at this address:

Business License Center, 1100 4th Street, SW, 2nd Floor, Washington, DC 20024.

You can also mail your forms to:

Wells Fargo Bank DC Government Wholesale Lockbox 913607175 Columbia Gateway Drive Columbia, MD 21046

You must include a check written to the DC Treasurer. The online process will save you a trip and keep you from waiting in line or waiting on the mail. Regardless of the filing option of your choice, you’re on your way to becoming a DC landlord!

You’ve finally obtained your rental property license, doesn’t it feel good? Now you can move forward with renting to an excited new tenant, avoid the penalties and fines that come with not having your rental property license, and start bringing in some income. 

Ask for Help

The final and most beneficial step following getting your rental property license is hiring a property management company to help find the perfect tenant(s). Rather than filling out even more paperwork, dealing with potential applicants and tenants face to face, and a million other tasks, why not have somebody handle it for you? Avoid the hassle and headache by having a property manager that deals with the groundwork while you collect the payment each month. 

A team like ours at Nomadic Real Estate will bring in years of experience, insight on how to spruce up the property for renters if needed, and help you get your rental property license if needed. You’ll have an extra set of eyes to look over the fine details of your rental, help with creating a lease agreement that fits your standards and needs, and also somebody you can trust to do things right. 

Contact us today if you have any questions or concerns, or if you’d like to get your rental property on the market asap. We’ll help you through every step of the process and you won’t pay us a dime until we’ve gotten a tenant moved in. You won’t pay us until you’ve been paid. 

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Enhanced Reporting

Your portal includes a selection of extremely useful reports. Reports are available in the “Reports” section, and are distinct from the financial statements. Unlike financial statements which are static records, Reports are dynamic real-time records that will update with current data every time you view them. 

Scroll down to learn more about Reports:

Navigate to the "Reports" module in your portal:

  • Keep in mind, these reports are dynamic records. They will refresh to display current information every time you view them. 

Enhanced Rent Roll Report:

  • The Enhanced Rent Roll Report will show the rent amount, last payment date, move-in date, lease expiration date, and security deposit amount for each of your tenants. 
  • It will also show a portfolio summary with occupancy percentage, vacancy loss, and more!

Unit Comparison Report:

  • If you own multiple units (or buildings) with Nomadic, you’ll get access to the Unit Comparison Report. 
  • This report enables you to quickly compare financial performance between your units at a glance without toggling between individual reports. 

Income Statement Month-Over-Month:

  • The Income Statement Detail – Monthly Report serves as a month-over-month record of portfolio performance. You’ll see itemized income and expense categories and can track monthly. This report will update with fresh data every time you view it. 

Financial Statements

Financial statements will be published to your portal on a monthly basis. The statements are found in your Documents library, and provide a historical record of all financial performance. The statements serve as a snapshot of financial performance over a given period, and are static documents (unlike Reports, the statements do not update/change in real-time). 

Scroll down for more info about the Financial Statements in your Documents library:

The Documents area contains monthly financial statements:

  • The statements in the Documents are are static documents. They are posted to the portal once a month to serve as a historical record of financial performance. 

Download a statement to see month and YTD financials:

You'll also find a month-over-month operating statement:

Portal Communication Tool

You can use your owner portal to communicate with our team. Any messages you send through the portal will go straight to your Account Manager. When we reply, you’ll get an email notification and you’ll also see the message in your portal next time you log in. 

Here’s an overview of using the communication platform:

Click "Communications" and navigate to "Conversations":

  • The communications module will contain a record of all messages that you create through the portal. 

Click the "New Message" button and send your message:

Responses will show up in the conversation ticket:

  • You’ll get an email notification whenever you get a response, and you’ll also see the message in your portal next time you log in. 

You can reply in-line using the comment box:

Each conversation will be logged in its entirety:

Understanding the Ledger

Your portal includes a ledger with all transactions. The ledger is populated with data in real-time as transactions flow through our accounting software. Much of this information is also available in the Reports area, as well as the Statements in your Documents library, but the ledger is the most comprehensive resource for diving into the details. 

Please scroll through the sections below to get a better understanding of how to interpret the ledger. 

By default, transactions are sorted chronologically:

  • The date reflected in the lefthand column is the actual transaction date, not the “bill date”. This is the date the transaction was actually processed. 

If you have multiple properties with Nomadic, you'll see the address for each transaction in the "Location" column:

  • You can filter the ledger to look at just one property, all properties, or specific sets of properties. 
  • If you only have one property with us, you’ll just see the ledger for that property. 

The Description column displays the transaction type:

  • BILL: this is an expense transaction, such as for repair costs or management fees.
  • CHARGE: this is a transaction  billed to the tenant, most typically a rent payment. 
  • NACHA EXPORT: this is a credit we processed to your distribution account. This type of transaction is how you get paid! 

The Amount column shows the dollar value of each transaction:

  • Positive Amounts: if an amount is positive, it reflects a transaction that is payable to you. Typically, this will be a rent payment that we collected from your tenants. On occasion, a positive number could also signify a journal entry or credit adjustment. 
  • Negative Amounts:  if an amount is negative, this is a transaction that is either payable to Nomadic or is an amount that has already been paid to you. Typically this will be for repair costs or management/leasing fees. Owner draws (net distributions into your checking/savings account) also reflect as negative amounts, since they have already been paid to you. 

The Account Balance column shows a sum of positive/negative transactions at a given point in time:

  • Account Balance should always equal zero after a net distribution has been processed. When the balance is zero, this means that all expenses have been paid and you’ve received the remainder as net operating income, leaving a balance of zero (meaning: no one is due any money, as all funds have been distributed appropriately). 

Navigating the Propertyware Owner Portal

Your portal includes some extremely useful features that help you understand your property’s financial performance at a new level, with real-time transparency into every transaction.

Scroll through the snapshots below for an overview of portal navigation! If you need more help or have specific questions about using the portal, you can reach out to your Account Manager any time for a screen share. 

You can filter all info by date range or property:

View a snapshot of income and expenses on your dashboard:

See every transaction in real-time on your ledger:

Statements and forms will be posted to your documents library:

View a suite of real-time financial reports:

See a running list of all bills, and drill down for more detail:

Under Bill Details, you'll find dates/descriptions/amounts and more:

You can also communicate with your Account Manager through the portal:

How do net distributions work?

Net distributions keep your accounting clean and simple. Each month we’ll collect rent from the tenants, deduct any repair expenses for the previous month and any management/leasing fees for the current month, and credit the remaining net operating income to your account. 

You’ll receive a statement via email each time a net distribution is processed, and can view all transaction details in your Propertyware owner portal.