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...
System - Monday, November 12, 2018
You probably saw the video that went viral when an airline did not allow a woman to take her emotional support peacock on a plane. You may have also heard that miniature pot-bellied pigs are gradually becoming a popular choice for emotional support animals because they are highly intelligent, attentive, and extremely affectionate.
You may not have heard, but need to be aware, that new Fair Housing regulations provide clear guidance that service animals and emotional support animals are not considered pets and therefor cannot be considered by a landlord or property manager when making a decision regarding accepting an application for tenancy. In addition, a pet deposit cannot be required. Fair Housing guidelines also stipulate that applicants must provide appropriate medical documentation showing the need for the emotional support animals.
An emotional support animal provides companionship, relieves loneliness, and can sometimes help with depression, anxiety, and certain phobias. These animals do not have any special training or certifications.
A service animal is typically a dog that is individually trained to do work or perform tasks for the benefit of a person with a disability.
This week, we...
System - Thursday, November 1, 2018
As many of our landlords are not professional investors, when market conditions are more favorable, or when something happens in their life that makes owning a rental property difficult, landlords sometimes ask us if they can terminate the lease in order to sell the property.
The lease is a contract between 2 parties (tenant and landlord). Each party depends on the other to fulfill their end of the contract. There are only 2 provisions in the lease that allow for early termination without penalty:
- A tenant who receives Military Orders has the right to terminate the lease without penalty.
- A landlord who lives outside of the area at the start of the lease may also terminate the lease if he/she is transferred back to the area and intends to move back into the home.
Except for these two reasons, the lease cannot be terminated cleanly. If it is important for a landlord to explore the selling the home, we can offer the tenant the option to move out early, or incentivize them to do so. This year, two of our landlords asked tenants to move out early and tenants took immediate action. Two other landlords asked tenants to move out early and those tenants were not open to moving due to financ...
Michele - Monday, October 8, 2018
The lease is clear, it is a contract between two parties, and the tenant is responsible for paying all rent through the lease end date.
There are only two provisions in the lease that allow for termination without penalty. First, the landlord may terminate the lease with a 60-day notice if he/she is being transferred back to the DC area by his/her employer and intends to move back into the home. Second, a tenant who is in the Military may terminate the lease when he/she receives orders. In some scenarios (if negotiated in advance), a non-Military tenant may also terminate the lease due to a job transfer.
Due to the realities of life, there are many reasons why a tenant would request to break their lease - a sick mother in California that needs to be cared for, a job opportunity in Cleveland close to where the grandkids live, low interests rates opening up unexpected options for a home purchase, the loss of a job, or a family emergency. While we realize that everyone’s reason may be different, seem justifiable, or require special accommodations, we treat all requests for lease breaks in the same way so that we are sure to be in compliance with Fair Housing Laws.
If a tenant requests a lease brea...
System - Monday, October 1, 2018
Over the past ten years, I’ve spoken to hundreds of landlords about how the decision to proceed with a home warranty is a budget decision which should be made based on the age of their appliances, the size of their maintenance reserve fund, and their perspective on repairing versus replacing appliances. I’ve also written several blogs on the pros and cons of home warranties. Lately, in our experience, the cons have been outweighing the pros.
Last weekend, we had a dryer delivered to one of our managed properties. This delivery occurred only after our staff member asked the landlord for permission to handle the situation outside of the warranty because the warranty company had been working on first repairing and then replacing the dryer with 3 service calls followed by 3 missed delivery appointments over 2 MONTHS! This tenant is not happy and we’ll need to regain her confidence before we engage her in a conversation about lease renewal.
Please see the excellent blog written by one of our colleagues in FL:
Michele - Wednesday, September 26, 2018
Landlords: According to Angie’s List you should seek 3 estimates before proceeding with a home repair. Lowe’s Contractor referral site refers 3 contractors for homeowners seeking estimates. Many homeowners have heard that they need to get 3 quotes for any major work to be done on their home.
But why is this necessary? Usually, a homeowner is not familiar with local contractors, nor is he or she familiar with average pricing for painting, drywall, carpentry or other types of home repairs. If that’s the case, a home owner needs to get several data points (quotes) in order to triangulate the data and make a comfortable decision on the best course of action.
But… When you hire a professional property manager to manage your home, you have hired someone who does know local contractors, who is familiar with average pricing for most repairs, and who has already triangulated the data!
With over 400 homes under management, we address nearly 1000 work requests per year. We know what it costs to install a garbage disposal, replace a gas hot water heater, paint a wall, replace a sliding glass door, and upgrade an HVAC system. We’ve ...
Michele - Monday, September 17, 2018
Nothing is more stressful to a tenant than to have their car towed on the day after they move into their new home! It is so important for landlords to provide us with the parking regulations for their community and to ensure that we receive any updates to the parking regulations over time.
Each community has unique requirements regarding vehicle registration, decals, hang tags, visitor spots, and general parking rules. Tow truck companies make money only when they tow, so tow truck drivers cruise through neighborhoods every night looking for improperly parked cars. Frequently, the cars towed belong to new residents who are not up to speed on parking regulations. All new landlords should provide us with a copy of the written parking guidelines, along with all needed parking passes or registration forms.
Over time, communities may update their parking guidelines. It is critical that landlords either request that all HOA/Condo Association bylaw updates be mailed to our company, or to forward such updates to us immediately upon receipt. Several years ago, the Powell’s Run Village Condo Association implemented a new policy that required occupants to have decals on vehicles parked in their driveways. Last ...
Michele - Monday, September 10, 2018
Fortunately, we seldom find our landlords worrying about whether or not they will need to hire an attorney.
Current Virginia Landlord Tenant Law allows property managers with a valid management agreement to file a summons and appear in court on behalf of a landlord, in order to evict a tenant through an uncontested unlawful detainer process and to seek a judgment for property damages that exceed a security deposit.
There are some scenarios where a property manager would not be able to represent a landlord in court, as doing so would constitute the property manager attempting to practice law.
Bankruptcy – if a tenant who is not current on rental payments files for bankruptcy, before an eviction can occur, an attorney will need to petition the bankruptcy court in order to have the lease removed from the bankruptcy proceedings. This is generally a straightforward process, but it does require the use of an attorney and does add approximately one month to the timeline needed to complete an eviction.
Tenant Assertion – Under the Virginia Residential Landlord Tenant Act, if the landlord is not properly maintaining the home under the terms of the lease, the...
Michele - Monday, September 3, 2018
In the past, when we included a rental rate increase at renewal, tenants would often contest the increase asking why the owner would want to increase the rent given that they are “great tenants” who pay the rent on-time and keep the house is good condition. Of course a landlord would want to increase the rent at renewal time to offset the likely increases in HOA fees, homeowner’s insurance, and property taxes.
To overcome the objection of a rental increase, 5 years ago, we began documenting a required 3% increase at renewal into the original lease. We chose a 3% increase because the average annual rent in Prince William County has historically risen 3-5% per year. Keeping the increase on the lower side of that range allows an acknowledgment/appreciation of the tenant’s good standing. Documenting the increase in the original lease allows the tenant to be prepared for the increase and eliminates most objections.
One scenario to be aware of is that some neighborhoods may experience flat or decreased rental rates due to over supply or competition from new communities. In this scenario, the resulting rent at the end of a long-term tenant’s occupancy may actually be higher than mark...
Michele - Sunday, July 22, 2018
As a property management company, we offer two separate services:
- Tenant Procurement (referred to as Listing the Property) and
- Management of the property once a tenant is in place.
Most landlords take advantage of both of the services that we offer.
Sometimes, a landlord may already have a perspective tenant identified from their social network or may wish to minimize their tenant procurement costs by finding a tenant using their own online resources. We are happy to work with a landlord in these scenarios as long as the landlord is still in the property and can coordinate showings, answer perspective tenant questions, and negotiate terms of the lease.
If the landlord decides not to procure their own tenant, we welcome the opportunity to list the property. This entails providing a market analysis, determining a list price, photographing the property, installing a sign and lockbox, coordinating showings, providing weekly updates, processing applications, and negotiating the lease. This service requires a licensed Realtor who is compensated through the listing fee based on a percentage of the rental rate. In our busines...