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February 4, 2010 at 1:16 pm

Filling vacancies in your apartment units quickly can be the difference between success and failure with real estate investments. Looking for tenants anywhere you can find them increases your odds of success, but never forget that not all situations are equal. One area to be especially careful of is when working with renting to family members. I am not talking about renting a unit to a member of your own family, although that can be an issue as well. I am referring to the situation where you have a vacancy in your upstairs unit and the downstairs tenant refers their cousin Billy as a potential renter.  Should you run across this situation I just have one simple thing to tell you: “Be careful.”

The first thing to ask yourself is whether the tenant doing the referring has been a good tenant. If they haven’t, a referral from them should be avoided. If they have been exemplary, it might be worth giving the person a shot, but make sure you run your normal background checks and that the person truly qualifies.

Even if they do, just use good judgment on how you handle things. I have been witness to a few horror stories where two or more units in a building were rented by family members, who seemed to think that since they knew each other that they could do anything they wanted. Keeping discipline in an apartment building can be a challenge in an situation, but things like these can make things even more murky.

You also can face problems if the referrer or referee family member defaults on their lease and you have to evict them. Some tenants might not blame you at all if you evict their relative and they deserve it, but others might walk out on their lease along with their departing kin.

The morale of the story is simply to be aware that things can be too to be true in the world of property management. Should you encounter a situation such as this, just make sure you consider the baggage that comes along with taking on related tenants.

November 11, 2009 at 9:19 pm

It’s 5:30pm and you just got home from work.  Your iPhone alerts you to an email you just received from a perspective tenant. It just wait until the morning can’t it? Not if you want to rent your unit to a good tenant ASAP. Read more

July 22, 2009 at 6:14 pm

One thing I have always taken for granted in real estate investing is the apartment lease. Just after getting into the business I got a hold of a great lease and I guess I have been a little spoiled. Read more

May 7, 2009 at 11:10 pm

If you own rental units, you know how tedious it can be filling your vacant units. In order to compete with all the other landlords out there, you have to be persistent, creative and ready to meet prospective tenants at the drop of a hat. Thankfully, Threshold Investment Properties is now offering a leasing service to help you fill your units quickly and with no hassle. Read more

November 14, 2007 at 10:15 pm

*NOTE – This article was originally written in October of 2006 for the newsletter.

You’ve been trying to lease that apartment for weeks. You finally have an appointment for a showing. The prospect tenant shows up and says how much they love the apartment. Weeks later the apartment still hasn’t been rented and you are still losing money. What went wrong? Was the unit not right for the prospect? Maybe, but it might also have been you.

One of the hardest parts of being a landlord is getting tenants for your units. Even the highest quality units can sit vacant if they aren’t shown properly. The greatest marketing strategy in town can be wasted if you don’t close the deal. Here are a few tips on how you can make the most of your showings:

  • Remember that you are selling the apartment. The apartment will not sell itself. When the tenant arrives, you shouldn’t simply open the door and let them walk around. You should walk with them, pointing out the great features of the apartment.
  • When the prospect leaves, make sure they walk away with a rental application and a flyer displaying all the information they need to know about the apartment. Once they walk out the apartment door, they have already begun to forget some of the details of the apartment. The flyer will serve as a refresher and make the apartment stand out from the others they might have visited.
  • When giving the tenant a rental application or talking about the application, avoid calling it a credit or background check. These terms tend to scare away even quality tenants. Simply call the form a rental application. If they ask what that encompasses, let them know that you screen all tenants to help ensure the safety of all your tenants. That tends to be reassuring.
  • Follow the “smells good, looks good, feels good” rule. Try to get to your showings before the tenant arrives. If the unit has an odd or stale smell, put an air freshener in the unit. If the apartment is too hot or cold, turn on the AC or furnace. Turn on the lights beforehand. Make sure everything is presentable.

Keeping to these rules will help you to make the most out of your showings. That’s an important thing. After all, each day the unit goes unrented is money out of your pocket.

November 14, 2007 at 10:06 pm

*NOTE – This article was originally written in October of 2006 for the newsletter.

One of the most awkward situations a landlord can face is informing a tenant that they will not be renewing their lease. Whether the tenant has been in the apartment for one year or ten, it can be a delicate matter. Proper management of the situation will help to avoid lack of rental payment and property damage. Following these tips will help to make the situation easier.:

  • Send the tenant a letter explaining that their lease expires soon. Sending out such a letter 45 to 60 days prior to lease expiration will generally lead to the most satisfying results.
  • If the tenant was a good one, offer to provide them with a letter of reference for procuring a new residence. Many tenants feel a bit insulted by not being allowed to renew their lease. This action can help to lessen this feeling.
  • Avoid threats and insults during the process. Even if the tenant vacates on time, these will increase the chances that the tenant will intentionally do damage to the unit or not pay their last month’s rent.
  • If the tenant directly asks why they are not being allowed to renew, one response that is generally well accepted is to say that the apartment needs improvement, which can only be addressed if it is vacated.

If you follow these tips, your chances of a smooth transition will be much higher.
Use them wisely.

November 14, 2007 at 5:30 pm

*NOTE – This article was originally written in July of 2006 for the newsletter.

An often overlooked side of owning investment property, is how to manage the property in the most efficient way. Simply throwing in any tenant and letting the property sit idle could eventually lead to major troubles. Although, some things take time to employ, in the long run they can make your life a lot easier. The following are a few tips to help your investment run a smoothly as possible:

1. Screen tenants
Don’t rent to anyone before checking their credit history, references, background and previous landlords. Haphazard screening and tenant selection too often results in problems — a tenant who pays the rent late or not at all, trashes your place, or lets undesirable friends move in can cause you some major headaches.

2. Get it in writing
Get all the important terms of the tenancy in writing. Beginning with the rental application and lease or rental agreement, be sure to document important facts of your relationship with your tenants — including when and how you handle tenant complaints and repair problems, notice you must give to enter a tenant’s apartment, and the like. Written leases enhance resale value, allow and help to make the property run more smoothly.

3. Handle deposits properly
Establish a system of setting, collecting, holding, and returning security deposits. Inspect and document the condition of the rental unit before the tenant moves in, to avoid disputes over security deposits when the tenant moves out. Documenting the condition and taking pictures of each room and existing damage in the unit ensures legal justification for withholding the security deposit when the tenant vacates.

4. Make repairs
Stay on top of maintenance and repair needs and make repairs when requested. If the property is not kept in good repair, you’ll alienate good tenants, and tenants may gain the right to withhold rent, repair the problem and deduct the cost from the rent, sue for injuries caused by defective conditions, and/or move out without needing to give notice.

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