Tenants « AllPropertyManagement.com

Archive for the ‘Tenants’ Category

Report: Fewer tenants renewing leases

February 7th, 2012

Property managers may want to step up their efforts to retain tenants, given the results of a recent survey.

Research by Kingsley Associates indicates that the number of renters choosing to renew their leases dropped to a three-year low in the fourth quarter of 2011, though analysts suggest tenant satisfaction with current rental properties was stable during the period.

“As renters themselves recover, there are indications that more of them are renting by choice,” said Kingsley Associates principal John Falco. “They aren’t unhappy – just choosy.”

Tenant satisfaction dropped only 0.1 percent from the previous quarter, according to researchers, and has been stable for three consecutive periods now. This suggests that owners and property management companies are not driving tenants away.

According to the report, 32 percent of surveyed renters had incomes of at least $75,000, higher than the 30.7 percent with incomes of less than $40,000. This result reportedly represents a deviation from recent years.

The number of renters 55 or more years old also increased to 13.4 percent from 12.6 percent in the period ending in the second quarter. The number of residents who live alone grew more than 2 percentage points, reaching 45.9 percent of those surveyed.

Holding a Successful Open House

February 1st, 2012

open house tips Novice property investors looking to hold their first open house could need some guidance, as they’ll want to make sure everything goes smoothly to pique the interest of potential renters.

When prospective tenants come to an open house, have a sign-in sheet waiting. Besides getting their contact information, this can be good for security purposes, a concern when allowing strangers through a property.

Rental managers may want to give guided tours of their properties to make sure that visitors see the highlights and advantages. Discuss good lighting, views and other benefits. If there are neighborhood attractions nearby, consider giving the visitor some background on them.

These steps may help attract and appeal to guests:

Advertise the open house online and with signs, preferably placed at nearby intersections with significant traffic.
Consider holding the open house at a time when others will not be open so more visitors can make it.
Print fliers with contact information, the date, time and address of the open house, and distribute them locally.
Have rental applications and information ready, so that eager prospects can apply on the spot if they want to.
Make sure the property is tidy inside and outside.
Check lighting fixtures and replace any that are not bright, so visitors can see clearly. Also, let light in through the windows.
Keep parking open so that visitors don’t have to walk far.

Open houses can be an efficient way ?for landlords to meet, and show a property to, potential tenants. Meanwhile, having visible competition sometimes pushes potential tenants to apply more quickly.

Setting Pet Fees

January 30th, 2012

setting pet fees Landlords and property management companies may find it difficult to figure out how to set appropriate pet fees for renters bringing an animal to live with them.

Type of animal
The amount you want to charge may depend on the pet. It is common to charge less for cats than dogs, and to charge more for larger dogs. Pets like turtles, which do not generally affect the property, are commonly ignored.

Rental managers and owners should ensure their policy clearly states what pets are allowed to avoid confusion. It should also be clear that adding pets after moving in could require additional payments.

Rent, fees or deposit?
One way to cover the expense of a pet is to charge a higher rent. Spacing the cost out over time may be easier for tenants to afford, and can increase the profit for the manager in some cases.

The alternative is to charge an up-front fee frequently a pet security deposit. Some states have laws restricting the amount of the total security deposit, so check for that before setting an amount. This deposit would be refunded after the tenant moves out, assuming the property is not damaged by the pet. Non-refundable fees are also used, although these are typically smaller.

Some landlords may combine more than one of these options, charging a higher rent each month and requiring a pet security deposit to cover any damages.

Defining “Visitors” v. “Roommates”

January 30th, 2012

When a visitor or guest stays in a rental property long enough, it can begin to have a significant impact. Water, sewer and other bills may go up. If the tenants are paying these bills, then rental managers and owners in this situation may not have a problem.

An extra person can add to general wear and tear on a property and its fixtures as well, however, and in many cases utility costs may be included in the rent. Besides that, tenants may not be sure where the line between visitor and roommate is.

To avoid confusion, property management companies and owners should develop a clear policy. According to the American Apartment Owners Association (AAOA), this may cover:

Security access, due to theft and liability concerns
Restrictions on the number of guests allowed at a single time
Limits on how long guests can stay before they are considered to be residents
Any rules governing smoking, noise or other behaviors that can disturb neighbors
Penalties for violating the policy
Any advance notice required for exceptions

According to the AAOA, state laws that govern a landlord’s right to raise rent or take other action because of a new occupant vary, so these should be reviewed when creating a policy.

While occasional exceptions can be made, enforcing the policy consistently can help avoid both legal and personal difficulties. Treating tenants differently can seem unfair at best, or be perceived as discrimination. Online legal resource Nolo suggests that, while caution may be justified, tracking a tenant’s visitors too closely may be considered an invasion of privacy in court.

Prospective Tenants and Credit Reports

January 13th, 2012

tenants and credit reports

Before you approve an applicant to lease a unit of yours —or give your A-OK to your rental property management firm to let them sign a contract—it’s highly advisable to go over the potential renter’s credit history.

Checking an applicant’s credit will generally require a few pieces of information, specifically his or her name, address and Social Security number or Individual Taxpayer Identification Number.

Extensive credit information is compiled by Equifax, Experian and TransUnion, but landlords and property managers commonly contact smaller businesses which get information from those three. Such companies may operate on a more local, rather than national, basis.

Credit reports may contain information on credit cards, loans, mortgages and other financial transactions the applicant has been involved in. Looking at a person’s credit history can show trends over time. For example, an applicant may have experienced a period of troubled finances but have a stable record based on more recent transactions.

If a landlord or property manager decides to reject an applicant based on his or her credit report, then the applicant must be notified of that fact. Such a notification must also include the name of the company that supplied the credit information and a notice that the applicant can request a free copy of his or her credit report within the next 60 days.

This is meant to help protect consumers against incorrect credit information being counted against them, among other purposes, and failure to provide notice can have legal consequences, so care is warranted.

What Renters Want: Amenities

June 2nd, 2011

Savvy property investors pile on amenities
(Photo credit: Matt Johnson, for Finance & Commerce)

Even as rental markets tighten, competition for the best tenants (read: the ones who aren’t newly bankrupt) remains fierce. Savvy property investors looking to attract the high-income segment of the rental population are still “piling on amenities” according to a recent article from the web site Finance & Commerce.

Along with the usual suspects—granite counter tops, stainless steel appliances, and other high-end finishes—renters are gravitating toward properties that include such conveniences as on-site fitness centers, luxurious indoor and outdoor communal spaces, housekeeping services, underground parking, and attached restaurants.

According to the article, renters want “magic” and are willing to pay for it, while property investors who are willing to make the upfront investment in creating these luxury spaces reap long-term rewards that include lower-than-average vacancy rates and rental rates that are often two or three times the local average. The Minneapolis property Mill District City Apartments, for example, is able to charge up to $2600 per month in an area where typical rent is around $900. Even more surprising?? All of the building’s 175 units are full, and so is the waiting list.

Curbing Troublesome Tenants

May 30th, 2011

The thought of a troublesome tenant is something that can scare any property owner. Some states that are considered tenant friendly like California or Arizona, and that makes it much more difficult for property owners to deal with unreasonable tenants. One of the best ways to curb an incident from a tenant, like lack of rent, or damage to the property, is to protect themselves through clearly defined lease terms. More often than not a lease is put together by a landlord or real estate professional, and the basic rental forms are used. These forms can be added to, so that there are additional regulations and stipulations present.

Some Tips for the Lease

all property management, real estate property management, property companies...

Image via Wikipedia

One the biggest complaints by a property owner is that tenants are always late with the rent. Placing specific wording in the lease to affect of:

1. Eviction processes will begin on the first day after the grace period that rent has not been received. This is a great motivator to keep tenants on time.

2. Tenant shall pay (choose a percentage) of the total monthly rent in late fees after the grace period has ended for that month. This will remind them that the payment will begin to grow if not paid on time.

As a property owner, it is vital to not only protect yourself, but also to protect the investment interest. Rentals today are, more often than not, homes that could not sell, and owners could not afford to remain in the home. In fact, more homeowners are renting while they themselves rent out their own homes to tenants.

Constructing a Good Contract

If there is a stipulation listed within a lease agreement, and the tenants/renters agree and sign that agreement, then all that is listed within becomes binding. This is a great way to ensure that tenants will not take advantage of the property owner.

More People Are Moving in With Relatives

January 3rd, 2011

photo credit: dprevite

Because of the struggling economy, there are more and more people who are moving in with their relatives. Usually it’s their parents, but that’s not always the case – and it’s not limited to 20-somethings who are right out of college and can’t get a job. There are plenty of people in their 30s and older who are living with other relatives or who have moved back in with their parents, because they’ve lost jobs, homes, and families. They can’t get a new job that pays what the old one did, and they struggle to pay their bills. They’ve sold or walked away from their houses, too.

In many cases, families have split apart from the pressure that they face. In other cases, the entire family has moved in with a relative of one of the struggling people, just to have somewhere to stay. They don’t want to end up on the street, of course, but moving back with their family can bring its own kind of stress. For those who already lived close to family and spent a lot of time with them, it’s much less of a hassle than for those who aren’t close or who have been away for a long time.

For those who are making the tough choice to move back with relatives, or for those who are currently living with relatives, it’s important for you to know that the economy is starting to improve. While it won’t happen overnight, there are encouraging signs that the housing market and other economic indicators are getting better. People are starting to spend again, as was evidenced by the holiday shopping season. That was an encouraging piece of information to receive, and it’s likely to transfer over to the housing market in the coming year.

What is Renters Insurance and Do I Need it

September 22nd, 2010

photo credit: Editor B

Renters Insurance

Let?s face it; the word insurance tends to make people feel bored and fidgety. Most of us do not like the word and would probably do anything to avoid it if we could. We live in a world where there seems to be insurance for just about everything and in some cases it is required by law. This may be why if we are a renter, we completely overlook renters insurance. This may not be a good idea. Many people tend to think the renter already has insurance covering the property. This may or may not be the case. In any case getting ones own insurance is never a bad idea.

Even if your landlord has insurance, it will in most cases only cover physical damage to the building. After that the renter is left to him or her self. If there are any natural disasters or theft done to the building then the landlord may not be covered. By getting renters insurance it will cover any sort of accident or injury that may happen to you or a visitor. In some situations it will also cover loss of residence for any reason. In most cases this type of insurance is relatively cheap.

Generally there are 2 different types of renters insurance. They are, actual cash value and replacement cost. Actual cash value will cover the depreciated value of any goods that are damaged or stolen. Naturally this means you will get paid less than the item was bought for. This may not sound like such a great deal but on the bright side it is the cheaper of the 2. Replacement insurance on the other hand will give a full refund on your lost or damaged possessions. On the down side the premiums will be higher.

No matter which one you choose, the good news is that renters insurance is cheap. It should not cost more than a few hundred dollars a year. If you take into consideration the coverage you are getting it is a very good deal. Most people tend to think of it as something too expensive to get. This may be why many people do not bother getting it.

What’s Needed on an Application Form for Tenants?

March 30th, 2010

If you are responsible for choosing tenants for a rental property either as part of your work or for your own investment property, it’s a good idea to have an application form ready for potential tenants to fill in. One or two pages is usually enough, but there are several pieces of information which are particularly important to include. Try to ask for all or most of the following on your tenant application form:

All the basic details – name, date of birth, current address and telephone number.
Current workplace and how long they have worked there, plus the name and contact details for a workplace referee.
Salary details and, if applicable, information on other income that the tenant receives.
How long they have lived at their current address, and the contact details for their current landlord if applicable; if not, details of a previous landlord are also useful to have.
Information about whether the potential tenants have children or pets.

It is important to conduct the tenancy application procedure fairly, and by giving each potential tenant the same application form to fill in, you can easily show that you are asking everybody for the same information – that’s much easier to do in a tenancy application form than by interviewing them or just having a chat.