System - Monday, December 3, 2018
When discussing a target rental rate with landlords, I typically describe the need to balance between the competing goals of maximizing their cash flow and minimizing their vacancy. Setting a higher listing price will hopefully result in a more positive cash flow, while setting a lower listing price will more likely result in more interest from prospective tenants, a quicker move-in date, and a decreased likelihood of extended vacancy.
Personally, when setting a listing price for my own rental properties, I lean toward the lower range of the suggested listing price because I have a complete aversion to vacancy! Vacancy not only equals lack of cash flow, but also introduces many risks.
First, a landlord’s insurance policy may require additional coverage for properties that are vacant for more than 30 days. Landlords should always check with their insurance provider to understand their policy’s requirements regarding coverage during vacancies.
Vacant properties can become a “hang out” for teens to congregate around or break into. We’ve had several instances of teens breaking into vacant properties during the winter months to find a warm place to smoke. In some areas of our...
Michele - Sunday, March 13, 2016
When a landlord enters into a management agreement with us, we will require a copy of the declaration page of their dwelling policy with our company listed as Property Manager or Other Interested Party. At that time, we suggest that landlords review coverage with their insurer to note the differences in coverage between a homeowner’s policy and a dwelling policy that covers a rental property. We also suggest that landlords review the limitations of their policy associated with any extended vacancy periods. Some insurers have provisions forbidding aggressive breeds of dogs in tenant occupied properties, so it is important to review those guidelines as well.
Of course we hope to never need to interface with an insurance company, but due to pipe bursts, roof leaks, sump pump failures, condensation line blockages and sewage backups, we do find ourselves filing and coordinating insurance claims on behalf of our landlords, especially after major storms.
If major damage does occur due to an incident or event that is covered by the dwelling policy, we will discuss with the landlord whether a claim should be filed based on the policy deductible. Some l...