Michele - Thursday, September 29, 2016
Steven M. R. Covey published a book entitled “The Speed of Trust” which explains how trust—and the speed at which it is established with clients, employees and constituents—is the essential ingredient for any high–performance, successful organization.
When I read this book, I understood that it was imperative for our company to establish trust with our landlords at the very beginning of our business relationship.
Since most of our landlords plan to sell their rental properties once the market reaches a break-even or profitable level, our property management relationships typically last 4-6 years. During most of that time frame, our direct interaction with landlords will be minimal. We will collect rents, react to minor maintenance concerns, renew leases, or procure new tenants. Rarely, but possibly, we may need to contact a landlord in the midst of an emergency situation that requires a prompt decision and/or a significant and unexpected expense.
For instance, if a gas hot water heater leaks on a Friday night, a decision needs to be made whether to replace it immediately to allow tenants to have hot water over the weekend. Or if it is nearl...
Michele - Thursday, August 18, 2016
Landlords – If you own a large home with a basement rec room that has been converted into a poolroom, in most cases your incoming tenant will be excited about you leaving the pool table. Given the cost and hassle associated with moving a pool table, leaving it in the home is generally the best option for both landlord and tenant. Other than the pool table, landlords should plan to remove ALL of their personal property from the home when they convert their home into a rental property.
As landlords are packing up, they sometimes wonder if they can leave their bar stools, or large couch, thinking that the tenants may appreciate some furniture that fits perfectly in the house. Or landlords may wish to keep several large boxes or trunks in a storage area. In our experience, tenants want to walk into a completely empty house so that they can begin putting their own belongings in place. Tenants are concerned that they will be held responsible for the owner’s belongings and are really not comfortable with any such arrangement.
This month, we had three new landlords who asked tenants if they could leave a few things behind. In all three cases, th...
Michele - Wednesday, July 6, 2016
As part of our tenant screening process, we have always run a criminal background check on each applicant. We have provided our landlords with information regarding felony convictions within the past 7 years and any pending court dates that may have an impact on an applicant’s financial situation.
A recent Supreme Court ruling has upheld the determination that making housing decisions based on arrest and conviction records has a disparate impact on members of a protected class and therefore can not be used broadly as a reason for denying a rental application. Moving forward, property managers and rental listing agents must have clear policies and how and why data retrieved from a criminal history search will be used when screening tenants.
To comply with the new HUD guidelines, our company will provide landlords with the following information as part of the tenant screening process:
- Felony convictions in the past five years
- Drug distribution convictions in the past ten years
- Pattern of multiple drug possession convictions in the past five years
- Recent arrests awaiting trial which ...
Michele - Wednesday, April 27, 2016
When budgeting for annual expenses, owners should expect some minor “touch-ups” needed between tenants even when tenants take excellent care of their home. Outgoing tenants are allowed normal wear and tear, which includes minor scuffs/scrapes to walls in main living areas. Owners will most likely want to address those minor painting needs before the next tenant moves in. If more major painting touch-ups are needed, local judges restrict the amount that can be considered damages chargeable to the outgoing tenant depending on how recently the home was painted (See blog post “Collecting Damages from Tenants”).
Average carpet in a rental property is expected to last for 5-7 years when cleaned annually. So, depending on the age of the carpet, owners may need to budget for carpet replacement after long-term tenants. Carpets that do not need to be replaced may need to be stretched.
If a rental property is outfitted with relatively inexpensive blinds, these blinds are likely to need to be replaced every 5 years, or more frequently if they are used regularly to regulate sun into a home.
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...
Michele - Wednesday, February 17, 2016
When processing an application for a new tenant, we review credit and criminal history. We also verify income, employment, and rental or mortgage history. Unfortunately, we cannot vet an applicant on their house keeping skills.
However, we do have one possible way to glimpse into the how well an applicant may keep a home. When an applicant is well organized in their financial business, paying all bills on-time and not over extending their credit, it is likely that their organizational habits may extend to their home life as well. My mother in-law has an 830 credit score and her home is immaculate 365 days per year, so she is my point of reference, but over the past 5+ years, I’ve also seen a trend with our tenants. When tenants are working multiple jobs and scrambling to pay rent, they often don’t have the time, energy, or ability to maintain their rental property in a way that the owners wish or expect. Typically this doesn’t mean that there will be any damage to the home. But it does mean that the home may not show well when it is time to sell or re-rent.
So…. Just something that I’d suggest new landlords consider &h...
Michele - Wednesday, February 17, 2016
I often share with landlords that “late night emergencies” seldom occur. However, in late January and early February when significant storms and freezing temperatures occur, we do need to plan for emergency calls from our tenants. Last weekend, we had four emergency calls. There were two no-heat calls, one home without hot water, and one ruptured pipe inside a home.
In order to prepare for such emergencies, we have a 24 hour maintenance emergency call service, we remind tenants to change HVAC filters regularly, we coordinate with HVAC companies and plumbers in advance to ensure that we can receive priority service if needed, and we stock several room/space heaters to lend to tenants if failed heating systems can not be promptly repaired.
While our management contract requires any non-emergency repair exceeding $250 to be approved by the owner in advance, such emergency situations will be handled to the best of our ability and may exceed that financial threshold. Our obligation is to protect the home against further damages and to ensure the tenants have a safe and habitable environment in the home. We inform owners immediately if such em...
Michele - Tuesday, December 29, 2015
Having listed 140+ properties this year and hundreds more over the past several years, we are constantly looking for ways to measure and improve our listing performance. One statistic that we discovered early-on is that the optimal time to begin listing a property is 45 days before the availability date. Most tenants are looking for a property 30-45 days in advance of their target move-in date. For example, if a property is available for a tenant to move in on May 1st, we suggest putting the property on the market on March 15th. When we list a property 45 days in advance of the availability date, the majority of the time, we move tenants into the property on the target date.
Another important factor to ensuring that we have a tenant move in as close as possible to the availability date is pricing the property competitively when first going onto the market. Listed properties have the most visibility at the time they are first listed since many perspective renters have set up search criteria and are notified when a new property comes on the market that meets their criteria. Pricing even slightly above the range that is being searched for in the area means the property will not show up ...
Michele - Sunday, December 20, 2015
When I speak with perspective landlords, one of the pieces of information that I’m most proud to share is that 80% of the time we have a tenant move in on the day after the landlord or existing tenant moves out. When I network with other local property managers, I find that most do not allow for such one-day property turnovers.
Admittedly, there are lots of challenges associated with this process – scrambling to coordinate house cleaning or carpet cleaning when needed, handling coordination of utility transfer without interruption, and juggling schedules for inspections and key pick-ups. To address these challenges, we have vendors on standby to address needed tasks between 5PM on the last day of the month and noon on the first day of the month. Our staff works long days to allow for the quick turnovers as we feel the benefit to the owner of reduced vacancy is well worth the effort.
Since most leases end (and most owners move out) on the last day of the month, we list our managed properties as being available the next day, on the first of the following month, unless we have planned for repairs or maintenance to meet our ready-to-rent condition standards. Since most...
Michele - Thursday, December 3, 2015
As the weather is starting to get cold, we are wrapping up Fall/Winter HVAC servicing appointments for many of our managed properties. While we do not require landlords to put an annual service contract in place, we do encourage it. All local HVAC companies offer a service plan that includes two clean-and-check servicing appointments. This service provides the owner with valuable information about the condition of the furnace or air conditioner before the unit has to start its heavy workload for the upcoming season. Technicians will check all major components of the system and will advise if any further preventative maintenance or chemical cleaning is needed. For instance, replacing a capacitor that is not performing correctly is a very inexpensive action compared to the emergency situation and possible system damage that could occur if the capacitor fails completely. All manufactures suggest the semi-annual servicing and some home warranties will void a claim if it is clear that the unit has not been properly maintained.
Failure of an AC system in August or of a heating system in January typically requires emergency appointments with escalated costs and frustrated tenants. The cost ...