We thought you landlords and property managers out there would appreciate this infographic!
Provided by Nationwide Insurance
Provided by Nationwide Insurance
As a landlord you are super busy, so neglecting your rental property is easy to do. When your tenant vacates, you want to fill the vacancy as soon as possible. Balancing you time and money with the necessity for a quick turnaround is tough. At the same time, you want to insure that you get a great, long-term tenant. Of course screening and asking the right questions is very, very important, but the condition of your property will also attract the right clientele. What a dilemma! Too many landlords neglect simple things to get their rental property in rent-ready condition. Here a list in the WRONG things to do.
Mistake #1: Ignore Internet reviews
“They don’t really pay attention nowadays, there are so many reviews” you might think. Wrong. Reviews are as important as ever, and they are shared among your potential tenants. Respond to them, and contest those that might come from your competitors.
Mistake #2: Don’t bother painting
Painting is cost effective and makes a HUGE difference. It covers up holes in the walls, and can make your rental property feel inviting and comforting with the right colors. Neutral colors with bright accents work well.
Mistake #3: Bathroom upgrading is too messy
Oh yeah? Well, consider that the tenant is paying close attention to the bathroom. They don’t want to have to deal with leaky showers, toilets, or sinks. The bathrooms should ‘smell’ fresh and clean, and should have good lighting (NOT florescent bulbs). If you don’t need to replace faucets, be sure they are very clean and shiny! An electric scented candle is a really nice touch.
Mistake #4: Ignoring the all important kitchen
Like the bathroom, tenants often make decisions based on the kitchen. If your appliances are up to date, consider easy repairs such as staining the cabinets, replacing knobs, or adding new flooring. You can sometimes add new flooring on top of the existing flooring at a more reasonable cost. Be sure that the inside of the stove is very clean, as well as the inside of the refrigerator. If those are dirty, that can really turn off a prospective tenant.
Mistake #5: Don’t bother with ‘staging’
Not sure what that means? Staging is attention to the little things that make your rental ‘earthy’ and aesthetically appealing. For a small investment, you can purchase some paintings to match your wall coloring, put area rugs in strategic places, and put pillows or throws in the right spots. Don’t forget that mirrors make the room look bigger, so add mirrors in the kitchen, bedrooms and other choice locations. Go to Pinterest for ideas.
Mistake #6: Don’t consider first impressions
When a prospective renter pulls up to your property, you should catch their eye right away. Isn’t that important when you first meet someone in person? You should dress nicely and professionally when meeting a tenant. Your property should give a first impression as well. Have a welcome mat outside the door, and make sure the door is painted and has polished hardware. If an outdoor grill is visible, it will impress, and so will on outdoor chair or lounger.
Mistake #7: Don’t waste your time pampering
If you just consider your tenants as money generators, you are probably not a good landlord. They are people that want to start the next chapter of their lives in your dwelling. Make them feel at home by offering a welcome package, possibly with some snacks or chocolates and a bottle of wine. They will appreciate if you have a community newspaper, or some local guides that include local restaurants, nightclubs, and gyms. While you are at it, be sure to offer some incentives for your tenants to pay their rent in a timely manner and give them your contact info right away.
Mistake #8: Just use your previous photos
As you follow the previous advice, don’t forget to take new photos of your beautiful property. Now is the time. Use a high quality camera or cell phone and upload as large of an image as possible. Be sure to include all living areas, the kitchen, bathrooms, and storage areas. DO NOT include people, animals, or areas with bad lighting. You want to make your rental bright and inviting.
Ok, so all this may not be easy. But realize that you will get a return any time you improve your rental property, and you will fill you vacancies faster when your property makes a great first impression. And you will feel good knowing that you are being a good landlord that tenants will want to stay with.
Even if you are an owner of a single duplex, you should have good property management software. This especially rings true if you are a professional property management company managing for a number of rental property owners. There are so many choices, and many of them are very good, but most likely none of them will have every single feature that you might want to have in your property management software.
The initial decision is whether you want web-based Internet software or desktop-based on-premise software. This article is not going to get into the pros and cons of either. The 10 features mentioned should be present in any decision that you make. However, you will need to consider if you want to have an unending monthly payment to use software online (web based), or if you would rather purchase your software once and own it yourself for as long as you need it (desktop based).
#1. Ease of Use – What good is software that is confusing and difficult to use? Generally, I have found that software created by programmers doesn’t ‘think’ the way property managers think. The software companies founded by actual realtors and rental property managers seem to be the most user friendly with the best flow. So when you are looking at software, be sure to see how easy it is to look up a tenant by their name, by the rental address, or by the owner of the property. Also make sure that the accounting for that tenant is not far away, meaning that it takes more than one click to access the accounting once you have displayed the tenant info.
#2. Separation of Accounts – You are managing two entities, so you will need to provide separate accounting and reporting for each. First, you are managing the tenant, so you’ll need accounting for the rent charges, rent receipts, tenant expenses and more. Your software program should provide statements clearly showing the charges and income that you receive from the tenant. Secondly, you are managing the accounting for the owner of the property. So, you will need to maintain accounting showing the rent received, management fees (if applicable), repairs and maintenance and other charges. Then, it should be able to provide reporting for the owner that is easy to understand.
#3. Notices and Invoices – You need to stay on top of money due from your tenants. So, your software should be able to easily send ‘Payment Due’ invoices’ and ‘Late Rent’ notices. Be sure that you test this out and see how easy it is to use. Since you may want to use your own wording in the notice, make sure the wording is not ‘canned’ in order for you to create a customized notice.
#4. Easy Date-Sensitive Reporting – Running a report shouldn’t be difficult. Basically, you should be able to click on a report and set the date range. A good property management report will be easy to understand, show totals at the end of the report, and allow you to run the report for any date range, including weekly, monthly, quarterly, or yearly.
#5. A Good Vendor File – Vendors are a big part of your business. They repair your rental property and provide goods that you need to maintain their condition. Vendors might be general contractors, handymen, insurance companies, building supply companies, mortgage companies, utilities, or landscapers. So, your software should have a vendor section with unlimited vendors and keep plenty of information on each vendor. You should look for a property management system that includes the vendor name, contact information, phone numbers, email, tax ID numbers, addresses, and plenty of note space for each vendor. Additionally, the program should be able to insert any vendor into any check.
#6. A Reminder System – When you are juggling tenants, owners, and your own business needs, you can’t remember everything. Let your software do it for you. A good rental property software should have a comprehensive reminder system built-in to the product. Tenants are constantly calling with questions, maintenance requests, and possibly complaints about other tenants. If your software has a reminder system, you can immediately log the call and set a future date to take action if necessary. Additionally, the reminder system should be able to remind you of tenants with outstanding balances, lease expiration dates that are approaching, owners that owe you money, and more. Use the reminder for PR as well by putting in reminders for tenant and owner birthdays, and send them well wishes. Be sure to insist on a robust reminder system in your software.
#7. Checks and Deposits – Be sure that it is easy to create checks and deposits. A good software for a property manager should include a check register with reconciliation features and the ability to sort by check number, date, payee, and amount. A single check should be able to be posted to multiple rental properties, such as a check for a vendor that works on multiple units.
#8. Emailing Features – While your software should include the ability to print reports, it should also be able to email to your tenants, owners, and vendors. I’d suggest that it be able to keep two email addresses for each, and have the ability to create and save emails. The email should also have the ability to send attachments, because you might want to include an invoice or receipt with your email.
#9. Paying Owners – At the end of the month, you’ll need to send your owners a check for their net income received. Your software should be able to create owner checks with only one or two clicks, saving you the time needed to write a check yourself. If you prefer not to mail checks, your software should have the ability to send payments to your owners via ACH to their bank account. Typically this will be a small additional fee, but it is well worth it.
#10. Backup Features – Few things are as heart-breaking for a business owner as finding out that their data has been lost. Backups are critical. If you have web-based software, you should not depend upon someone else to do it for you, no matter how safe or redundant they claim their servers are. With desktop software, it is easier to make local copies of your data, but you have to remember to do it. Be sure your software has a ‘reminder’ for your backups, and do it on a regular basis. The better software will be able to backup to any drive, such as a memory stick, flash drive, or network server.
Choosing the right property management software can be daunting, but if you know what to look for, you will quickly narrow down the choices. Be sure that you are able to download a ‘Sample Program’ allowing you to try out the software prior to the purchase. Look for a company that has been in business for at least 10 years and has a track record. Of course, look at online reviews, but be aware that reviews are sometimes written by the competition, so there is no alternative to actually trying out the software yourself and talking to a knowledgeable representative of the company. If you cannot speak to someone in person via a toll free number, you should be wary of their support down the road. Even if the software is easy to use, you should insist on a company that provides free phone support to help you get started, and has a plan for support after that. Too many companies leave you high and dry after you make the purchase.
I hope these suggestions are helpful to you! Please let me know if you have any follow up questions!
About the author:
Wayne Gathright is the founder and primary coder of the Tenant File Property Management Software company. He has been in the real estate and property management business for over 20 years. Other products created by Wayne are a Work Order Program, Work Processor for Property Managers, Tax Software, and an eBook “What ALL Landlords REALLY Need to KNOW”.
Many landlords are now requiring that their tenants have renters insurance. If you are not one of them, you should consider the benefits for both you as the property manager (or owner) and for the tenant. This comprehensive article was created to help you make an informed decision about renters insurance for your tenants, and to provide some concrete advice about how to approach the subject and execute the plan.
The first thing to consider is whether or not you can ‘required’ you tenants to have it. Generally, but with exceptions, you are free to put a requirement in your lease saying that in order to rent from you, they must get renter’s insurance. You add other provisions such as quiet enjoyment and use of the facilities, so this is just another clause. There are a few exceptions, so you need to be aware of the regulations in the agreements you sign for subsidized housing and your local and state regulations. If you don’t currently require renter’s insurance, you can add that provision to your lease for new renters, and for existing tenants, you can sign a mutual agreement that is amended to your current lease. All of my daughter’s leases had that provision, including the amount required and that the ‘additional interest’ was to be the apartment complex management. In searching for insurance, I found that it really isn’t that expensive unless you (like any insurance) choose a low deductible and add optional c overages. More on that later. Read the FULL ARTICLE
“With this lease contract, I thee wed”
It’s a marriage between the tenants and the landlord . . . and everything is wonderful! The tenants are so excited to have a new place to live. Decorating is exciting, there are new things to buy, parties to plan, a shorter commute to work, and anticipation is in the air. The landlord is happy, too… finally the money will start coming in again, no more advertising costs and … wait, did I hear the tenant say “parties to plan”?
That’s just life, and part of the things that both landlord and tenants have to deal with in the complex landlord – tenant relationship. Right, life happens, and landlords need to realize that there WILL be bumps in the road. Will you drive fast over the bumps and damage your car, possibly losing control? Or will you carefully maneuver around those bumps, saving your car and your piece of mind?
Or is there an ‘out-of-the-box’ solution? Maybe, just maybe you can get the tenant to ‘fill in’ those bumps for you? Crazy? Not really, and this guide will give you some ideas on how you can work with your tenant to fill in the potholes of your long-term relationship.
I’m talking about ‘incentives’. Ways that you can work with your tenants to make sure that your rent is paid on time, that your tenants are happy with you as their landlord, and that your valuable assets are protected at the same time.
First, look at your tenants as ‘people’. Sounds silly, right? But many landlords just view their renters as money machines that only call them when they want something from you. Guess what? If that is your viewpoint, you are probably an unsuccessful landlord. You may get by with putting off a repair for a while, but then again your tenants may build resentment, damage your property, leave you, and then post a bad review on social media. Should you care? Of course, you should. Besides all of the expenses you will bear, you’ll soon be advertising for new tenants, and it will be even harder because like it or not, most tenants nowadays really will check for reviews about you on social media. If this sounds like tough love, maybe it is …your reputation matters.
Back to the wedding – what is the best way to have a marriage that lasts? Answer: Have a couple that knows each other well and accepts them way they are. In a relationship, that is by taking the time to develop love and understanding of one another. No, I’m not suggesting that you date your tenants – I’m saying that you need to do background checks! As a landlord, you need to know your tenants thoroughly by examining their credit history, employment history, rental history, criminal offenses, evictions and more. Hmmm, maybe that would also prevent some bad marriages too, but I digress. If you don’t do your homework at the beginning, it may not even matter if you take some of the other incentive steps I’ll mention later on.
Get to know your partner
The tenant usually pays for the background check, so failure to get one is like tossing a coin between getting a bad tenant or a good one. This is THE most important first step!
Meet and Greet
Ok, so now you are cool with the tenant screening part. Let’s get that lease signed! No, wait. You need to first talk to your tenants in person. If the tenant is a student, try to get the parent/guarantors there or at least on speakerphone. That way you can outline the responsibilities of all parties and have a clear understanding of what you expect of all of them. I like to have a separate meeting from the lease signing party because it is more relaxed and you don’t have to go over every provision of the lease in detail. Plus, you have a way to back out if things don’t go well. By that I mean, that you find out something that would be a deal killer, such as a roommate that isn’t confirmed, a problem with the parent guarantee, incorrect move-in or move-out dates, and so on. Plus, it is just fair to give the potential tenant time to go over the lease in detail so that they can ask questions prior to signing the lease with you. At the lease signing, be absolutely sure that you do go over the lease terms and make sure everyone understands it. Be super-friendly but also make it clear that this is a ‘professional’ relationship and you WILL enforce the terms of the lease strictly. It is a contract, not a guideline, so prepare your tenant for their legal responsibilities. But you don’t get off that easy, you must guarantee to your tenant that you will also enforce YOUR responsibilities, like enforcing their ‘quiet enjoyment’ (keeping the neighbors quiet), fix things that break (your stuff, not their TV or Xbox), and respond to their request promptly. Remember, when you are married, it takes two responsible people to make both happy.
Watch What You Say
One more thing, I have to warn you about some of the things that you CANNOT ask your tenant. There’s this little thing called the Federal Fair Housing Law or your state might have a separate one – it is a big legal no-no to not pay strict attention to it. Here it is in a nutshell – don’t discriminate! Here are some fairly blatant examples of what NOT to ask a tenant:
Don’t Be the Bad Guy (or Girl)
Now that you have let your tenants know that you will strictly enforce their lease, you can let them know you are not all that bad. There are ways that you can keep your tenant happy and even get them to work on your behalf (remember filling the potholes?). Here are some ideas on how you can maintain happy tenants and keep that rent money filling up your mattress.
Think Out of the Box
These are some things that will help you keep your tenants happy. There are many other things as well, but those fall in the category of ‘amenities’. If you manage an apartment complex, tenants have come to expect an exercise room, laundry facilities, pools, and common areas. But you can always take that one step further by providing a meet-and-greet on a regular basis, movie nights at the pool, or with each new tenant lease agreement signed, send out a ‘welcome’ on social media to the other tenants. Here are more ideas:
Finally, be sure to keep your rental property clean, well maintained and communication open with your tenant. When you do that, you will have the type of tenant that will be loyal, timely, and together you will smooth over those ‘potholes’ in the road you are traveling on. Happy marriage!
About the author:
Wayne Gathright is the President of W G Software, Inc., which produces the Tenant File Property Management Software. The Tenant File is used by over 5,000 landlords, property managers, and owners of rental property. The Tenant File was founded in 1995, and now manages over 200,000 rental units. Wayne has written several books related to property management including ‘What ALL Landlords REALLY Need to KNOW’, and manages a number of other websites related to real estate sales and rentals, tenant management, and rental property. In his spare time, Wayne is an award winning songwriter in Austin Texas. Visit the Tenant File at: http://www.TenantFile.com.
It’s all smiles and anticipation at first. The new tenant looking to start off in a new rental home, and the landlord looking forward to a good tenant that pays rent on time and takes care of the apartment. Then the nightmare begins – late rent, property damage, legal issues, and accusations. That’s the deadbeat tenant.
Some bad tenants are really, really good at it. They know the legal ropes and use them to their full advantage in order to stay in your rental as long as possible without having to pay rent. But there are precautions that you can take before, during and after their stay. Here is some advice for landlords on how to handle the situation.
After they move in, you need to be sure that you protect yourself in case the worst happens. That includes keeping multiple copies of their lease in a safe place, and documenting every call and issue that happens during their stay. If the rent is late, be sure to promptly send them notice and document any call, email, or note posted at the residence.
Once the legal deadline has passed and you have provided proper notices, you will need to go to your county courthouse, file the eviction notice and pay the fees to have legal notice service by the sheriff or process server. This can be expensive, but it is better than sitting for months without any income. Do not accept partial rent payments from the tenant, because that could start the entire process over again.
The tenant may claim that you did not follow the lease or provide needed repairs, so you really need to make sure that you document everything done throughout the entire stay, especially the move-in and move-out documentation. While you need to be firm in dealing with the tenant, you must also realize that communication should be open and you will need to decide if you will make any concessions at all.
Hopefully you can have a good (professional) relationship with your tenant and everything will work out well. However, planning for the deadbeat tenant may save you a lot of headaches down the road.
Unfortunately, late rent is a fact of life. While you would like to think that all of your tenants will pay rent on time every time, this sadly is not always the case. This is not always a huge deal. We all know that “life happens” and rent can sometimes be delayed, even with the most reliable tenants. If this starts to become a frequent issue – one that is causing you countless headaches – then certainly some steps need to be taken to correct the problem. This article will delve into some recommended ways for handling late rent.
As with many issues when it comes to leasing out property, it is important to have a policy on late rent written down on the lease agreement itself. For one, this allows you to communicate your expectations to the tenant in no uncertain terms. Secondly, it gives you legal recourse if you feel that you are being taken advantage of. The way you handle late rent is up to you. Perhaps a daily fee will be charged after a certain grace period (say, five days). You want a policy that will not scare off most potential tenants, but that will help ensure that your rent money comes in at the beginning of the month, every month. This is, after all, your income. You deserve to receive it on time!
One great way to cut down on late payments is to set up automatic payments. This is more convenient for you and the tenant. With an auto payment set up, the rent will deduct from the tenant’s account and go straight to yours—no need to deal with checks or money orders. Most importantly, you will not receive a late payment because the tenant forgot that it was the first of the month. It is important to let the tenant know that the money needs to be in their account when the automatic payment is due. If they don’t want to set up auto payments, encourage them to at least set up an online bill pay option. They have to remember to submit the payment every month, but at least you will not have to deal with checks. By purchasing some good landlord software, you can give your tenant the option of using automatic payments/online bill pay.
As mentioned before, things happen. Sometimes a tenant will have a legitimate emergency that prevents them from paying the rent on time. If this happens habitually though, it is likely that the tenant is taking advantage of you. This is why it is important to charge the late fees that were agreed upon in the lease. In extreme cases, eviction may even be necessary. An eviction isn’t a pleasant experience for any of the parties involved, but if rent is consistently late, it may be best to start over with a new, more reliable tenant.
If you have been a landlord long enough, chances are you have seen your fair share of bad tenants. You have likely dealt with late rent, domestic disturbances, noise complaints, perhaps even destruction of property. You might even be at your wit’s end, wondering where on earth you are going to find a stable, reliable tenant. Do not lose hope! Good tenants are out there, and with the right knowledge and resources, you can find them. This article will offer some pointers on how to ensure that all of your tenants will be an ideal fit for your property.
An important step in this process of finding the ideal tenant is screening potential applicants. In this case, it pays to utilize technology. By installing rental property management software on your computer, you greatly increase the tools in your screening arsenal. Such software allows you to run a credit check, a criminal background check, and previous rental history. Knowing this information upfront alleviates the three major concerns that most landlords have: that the tenant pays their debts (and isn’t bogged down with excess bills), that the tenant is a law-abiding citizen, and that the tenant has not caused any issues at other apartments. If the background check raises any red flags, do not hesitate to move on and keep looking. Don’t settle!
One good way to attract good tenants is to let good tenants know what you are offering them. This is why it is important to get the word out there regarding your property. Promote your amenities, your location, and the great deals that tenants will get by renting your property. To attract the ideal tenants, it is important to be deliberate about where you are placing these ads. Putting up fliers all over town, or using classified sites like Craigslist will likely attract any and all types, including scammers. Try advertising in more exclusive places, like real-estate guides and websites, or lifestyle magazines. Yes, you will spend more money advertising this way, but having stable tenants in all of your units makes the investment pay off.
If you have found a tenant who has signed your lease and given you a check, congratulations! You may be tempted to take down your listing at this point. This is not recommended. While it may be tempting to just relax and know your apartment is rented, you should wait for the check to clear first. While we would like to think the best of people, the truth is that checks bounce, issues arise, and the tenant we thought we were getting ends up being way different than what we expected. Take down your listing and remove your advertisements once the money is in your hand. Trust us, this will save you many headaches. If it turns out you are not getting the money that you thought you were, at least you are in prime position to get another tenant.
If you are a landlord, then maintaining and repairing property for your tenants is a fact of life. Many landlords prefer to let someone else handle the necessary repairs–either superintendents or service companies. While this option can certainly free up a lot of time for the landlord, it can be quite costly. Consider increasing your profit margins by tackling repair projects on your own: adopt the “do it yourself” mentality. While this might see like an intimidating prospect, it is certainly manageable. Even if you are not exceptionally handy, you will find that most repairs are easy to handle with the right tools and instruction. This article will point you to some resources that will allow you to take a DIY approach to property repairs.
The computer is a great tool for learning how to handle DIY projects around your property. Sites like Youtube have countless videos on how to handle any type of project, whether it involves plumbing, lighting, appliance repair, or any other type of repair that you can imagine. There are also many home improvement websites that provide thorough and helpful information on DIY repairs. By reading the helpful information on these sites, looking at illustrations, and watching videos, you can become a property repair expert much sooner than you might think.
One of the most difficult aspects of property repair, especially at a large apartment complex, is keeping track of all your work orders and knowing the status of all of your repairs. One convenient, hi-tech solution is to buy software for landlords that greatly helps you track and organize these items. When a tenant puts in a request for you to fix a broken sink, or repair a refrigerator – for example – you can put this work order in and close it out when the job is finished. If the work orders start to pile up, you can be confident that they are all organized and accounted for. If you do end up having to outsource any work, a good work order program will allow you to instantly create checks and email service providers. It is extremely handy having all work order and vendor information in one place.
Yes, you might sometimes feel that you are in over your head with repairs, especially at first. Even after watching all of the right videos and learning the tricks of the trade, you may find that some of the repair projects that you take on are beyond your skillset and expertise. Do not give up though! Like everything else, this is a learning process, and you will not be an expert handyman within a day. You might find yourself having to outsource many projects, but try to handle what projects you can. Experience is the greatest teacher you will find, and eventually you will notice that the repairs are getting easier and easier.
If you are looking for a surefire way to increase your income, maybe save some extra money for retirement, consider investing in a rental property. The idea might seem a bit overwhelming – perhaps you never envisioned yourself as a landlord – but rental properties are a safe and increasingly popular investment for people from all walks of life. Given the reliability of the real estate market over time, you are bound to see big returns on your investment. If you are considering this investment, but need a little more convincing, read further. This article will list the many benefits of owning a rental property.
There is an element of volatility in all markets, but over time, real estate has been proven to have some of the steadiest gains of any market. Ask anyone who has owned a home for a long time what they paid for it thirty or forty years ago, and what it is worth now. Chances are, the value has gone way up. Buying a rental property means that you will likely make huge profits when you finally do decide to sell. It also means that you will likely be able to increase your rents each year. This is especially true in a big city. In some of the hottest rental markets, the price of rent exceeds the value of a mortgage for a comparable unit! By investing in a rental property, you can make a sizable income upfront, and earn huge resale value down the line–the best of both worlds!
Another great advantage of owning an income property is that you have great flexibility regarding the length of your investment. If, after a few years, you find that being a landlord is not what you had imagined, you can always sell the property—likely for more than you paid for it. This gives you great freedom of choice regarding your investment. If, however, you do feel like holding onto the property for years, you are free to do that as well. The timing is all up to you.
With many investments, it can take a long time until you actually recoup your return. Perhaps you have money sitting in some portfolio, that you cannot deduct without a penalty. When you own a rental property – and especially if that property has zero vacancies – you will receive a steady income every single month. If that income is greater than what you pay for mortgage and upkeep, you have profits rolling in on a monthly basis. With the right lease management software, that money can be deposited straight to your bank account! If you would like to increase your profit margin even more, you can choose to live in a unit on your property. Many landlords choose to live on-site. Not only can this save you money—it will allow you to get to know your tenants and become more actively involved with your property.