Wesley Snipes’ IRS Case for Rental Home Inspections
Wesley Snipes is a great actor. Watching him in White Men Can’t Jump, Major League, and other films is some good theater.
But Wesley got some bad advice at tax time in the late 90’s. His accountants told him there was a loophole that would allow him to avoid $7M in taxes; in fact, he didn’t even have to file tax returns. He thought that sounded pretty good. And besides, everybody knows the IRS isn’t really paying close attention with the sheer amount of returns they have to log every year.
Well, the IRS was paying attention. And they got Wesley’s attention with a 3-year prison sentence that ended in 2013.
It was sad for everyone: his many fans, his accountants (who received even stiffer jail sentences), the IRS who had to use limited resources to prosecute his case, and especially for Wesley (who had reputedly earned over $40M from 1999-2004).
There were a lot of questions in Wesley’s case, but one almost undeniable certainty- Wesley’s tax returns now are the most truthful and timely documents he files every year.
This logic spills over into residential property management and periodic home inspections. If landlords can show tenants that they are paying attention to what is going on in the house and whether maintenance is being done, they will undoubtedly get a better conditioned house when the tenant eventually vacates.
So, yes, this means going over to and inside the rental house. I’d highly recommend giving the tenant a week or so notice of when the home inspection is and letting them know what you are specifically planning on looking at (e-mailing them a list is helpful).
Q. What should a landlord include in their home inspections?
A. Anything they care about.
Some general things I care about:
- Do the keys still work?
- Is the lawn and landscaping being kept up?
- Are the air filters being changed?
- Are the fire and CO detectors still there on each level of the house and are they functional (aka is the tenant changing the batteries when they die?)
- Is the home clean?
- Does it smell like smoke?
- Is there evidence of a pet if there isn’t supposed to be one?
- Does anything look weird?
Feel free to add anything else of interest. I also think conducting the home inspections twice a year (roughly on month 3 and month 9 of the lease) works well. Paying attention is good, stalking is bad.
Wesley has some well-maintained tax returns now and periodic home inspections should lead to some well-maintained rental homes.
Happy Landlording!
Brett Furniss is a property manager at BDF Realty (Charlotte Residential Property Management), the trusted real estate advisor for Charlotte landlords & Home of $100 Flat Fee Property Management. BDF Realty utilizes their innovative Pod System for exceptional customer service in residential property management, home repairs, and home sales for single-family homes, Uptown condos, and town homes in the Charlotte-Metro Area. Contact Us Today!
Learn MoreSection 8 Program Worth Revisiting? A Definite Maybe
No one really liked Janie. And there were a lot of reasons why. For a teenager, she was pretty much a know-at-all. Stubbornly obnoxious. She would not let you get a word in edgewise. Always right. Rude. Cocky. Maladjusted. And that was just her award-losing personality. And physically? Her scrawny frame, big glasses, and overflowing braces (often full of food scraps) made her equally unappealing.
Now fast forward 5 years in the life of Janie. After years of dejection, she has softened a bit. Instead of looking completely past you before beginning her monologue on her life’s recent happenings, she’ll toss a few platitudes your way that make you feel a small connection. “How are you doing?” “How’s your brother? “You get that mole taken off your back yet?” She’ll still take the last doughnut off the plate in front of both of you, but now she’ll pause and feign a glance your way for approval. She still texts constantly when you talk, but now raises her head for momentary eye contact when you bring up your mother’s cancer treatments. And her scrawny body has filled out, she started wearing contact lenses, and has a nice straight smile now; some may say she isn’t bad to look at, relatively attractive even.
But Janie’s not for everyone. Maybe not for most people. But some people “get her” and even go out of their way to be around her. Some of your friends have even dated her.
Ever know anyone like that?
The Section 8 program is like Janie in a way. Several years ago, I wrote how we needed to get our landlords out of the Section 8 business because it was impossible to get a good ROI for our owner clients. As a Charlotte property manager, we couldn’t cost justify the lower rents, costly repair items, poor communication, and overall effort needed to recommend the program. And I still get a little queasy thinking about it.
As a footnote, we do have clients that have kept their homes in the Section 8 program. The owners allowed the tenants to keep renewing their leases (most at significantly below market rates) and the Section 8 tenants chose to do so. The advantages to our owners are continued rental payments and not having to fix-up their properties to get them market-ready for new tenants. The negatives are that as Charlotte rental rates have been going up 5-10% annually, Section 8 has capped their permitted rental increases (if approved) to 2% annually (in real numbers: $900 monthly rent = $18.00 rent increase- not much to get excited about). Section 8 also conducts annual inspections which almost always lead to an owner repair bill; some of the items would never have to be repaired if the house didn’t have to meet many government regulations (re: peeling paint on ceiling, etc.).
However, in the past 6 months, Section 8 has enacted 2 changes that I thought were very landlord friendly:
- Locking a tenant into a property if they have lived there for 18 months. The owner has the option of not renewing the lease, but the tenant does not have the option of moving if they want to stay in the Section 8 program.
- Changing house inspections from annually to biannually. So, now the repairs only have to be made every 2 years (which is a huge deal for landlords who have gone through the nightmare of rent abatement for multiple inspection failures).
This still doesn’t make Section 8 work for everyone, but it might start making sense for some people. And as responsible property managers, it is something we will need to consider recommending again for certain owners (risk averse) and certain properties (difficult to fill, long term investment holds, areas of historically low rent appreciation). While the private rental market might be compared to the stock market (higher yields, more volatility), the Section 8 market might now be compared to the bond market (lower yields, steadier income).
So… your best buddy saw Janie the other day and said she was looking good and they had a nice chat. He said she asked about you. Your stomach still churns when thinking about your past dealings with her, but since she’s interested, maybe she’s worth meeting up for coffee? Maybe she’s changed?
Anyway, it’s something to think about- a definite maybe. Happy landlording!
Brett Furniss is the head property manager of BDF Realty (Charlotte Residential Property Management), the trusted real estate advisor for Charlotte landlords & Home of $100 Flat Fee Property Management. BDF Realty utilizes their innovative Pod System for exceptional customer service in residential property management, home repairs, and home sales for single-family homes, Uptown condos, and town homes in the Charlotte-Metro Area. Contact Us Today!
Learn MoreDo Your Rental Home Repair People Care? 2 Lessons Learned
“People don’t care how much you know until they know how much you care.”
Theodore Roosevelt
“We have met the enemy and he is us.”
Walt Kelly (Pogo)
When you’re in the property management business, many different things in houses will break. It’s a sad reality, but it is also the reality that keeps property managers in business (so we keep our complaints to a minimum!).
Contrary to popular thought in Charlotte, we really don’t know everything (please laugh!). So like most property management companies, we employ repair professionals to work on things that break (plumbing, roofs, appliances, HVAC, painting, etc.). They are, in effect, an extension of us at BDF Realty.
So how do we know if the repair people we use are any good? The simple answer is if things are fixed and tenants are not calling us to say their issue did not stay resolved. And if the issue recurs (which happens to the best of them), how does the repair person handle it? Do we get charged for another visit to the house? Do these recurring issues happen often? How long does it take for them to get back to do the repair again?
So skill-wise, we can figure out if a repair person is any good in a reasonable amount of time. Let’s call those the hard skills. But what about the soft skills? Are they kind? Conscientious?
Do they care?
That’s tougher. We can’t go on every service call with our repair people. And if they can’t at least fake being nice and caring during those calls, they weren’t going to last anyway. So how can you tell if they care?
I’ve learned 2 lessons over the years:
- If any tenants call to complain about a repair person, there is probably something wrong with the repair person. Two calls and there is definitely something wrong.
It takes time and effort to locate the property manager’s information, call them, and detail your experience without sounding like a whiner. Most tenants don’t care enough unless something is really off.
Several years ago, I used a really nice, reasonably priced handyman to work on many of our homes. When I would see him in person, he was sharp as a tack and would bend over backward to resolve issues. But I started getting a few tenant calls about chronic lateness and “shady” people he was bringing with him to work on jobs. We had to sever ties with him. He’s still a nice guy, but he just didn’t care enough to show up on time and be professional.
- If the repair person is treating us poorly, chances are they are doing the same to the tenants.
Recently, we had a repair person work on an issue at a vacant home for us. We gave him the lockbox code so he could get in and do the work. The next day we were at the property and found the house key in the lockbox, broken in half. We called the repair person and he said he had broken the key in the lock and forgotten to call us about it.
To me, that’s sort of a big deal, but not the key breaking per se. I will be the first to tell you that things happen. As Charles Swindoll said, “Life is 10% of what happens to me and 90% of how I react to it.” I’m not going to give someone a hard time over things breaking; truthfully the lock was tough and anyone could have broken a key in it. But not thinking it was important enough to let me know immediately about? I have to ask, “Does he care?”
Having repair people that care matters. Being a property manager who cares is important too. And the two are exactly the same to the tenants we serve.
Happy Landlording!
Brett Furniss is the head property manager of BDF Realty (Charlotte Residential Property Management), the trusted real estate advisor for Charlotte landlords & Home of $100 Flat Fee Property Management. BDF Realty utilizes their innovative Pod System for exceptional customer service in residential property management, home repairs, and home sales for single-family homes, Uptown condos, and town homes in the Charlotte-Metro Area. Contact Us Today!
Learn MoreToo Much Sympathy Can Kill Your Rental Business
“Moderation in all things, especially moderation.”
Ralph Waldo Emerson
Over the years as a Charlotte property manager, I’ve gotten a lot of calls from landlords who tell some version of this story:
We had placed a family of tenants into our rental home and everything was going great! They paid on time for the first 8 months and were really a joy to interact with. I mean, Brett, when minor repairs were needed around the house, they took care of it at their own expense- they would just call and ask if it was okay with us if they made the repairs! They really were a beautiful family; you should just see their youngest daughter, Cybil- she reminded me of my granddaughter! But, I digress…
The problems started when they were late in July. Apparently there was some mix-up with accounting at their work and the paychecks weren’t cut correctly that month. I was okay with it (things happen); they wound up paying on the 15th that month and I didn’t charge them the late fee that I could have. They assured me this was a one-time thing and they wouldn’t be late again.
August 1st came and went and there was no rent. When I called to ask about it, I started getting voicemail. Two weeks went by and I was wondering if I needed to start thinking about evicting them, but then they returned my call. They said their car had broken down which left them without transportation to work, so they had to choose to pay for the car repair instead of rent (you can’t earn money to pay rent if you can’t get to work). They said that was also why they didn’t call me back immediately; they didn’t have the funds to pay their cell phone bills either. After apologizing profusely, they asked if they could wait until the 1st of September to pay. “Of course,” I said.
September 1st came and we got a check for about a quarter of the rent (for August). They said the rest would come from the paycheck on the 15th. When the 15th came, they called to explain that it was either paying back rent or paying the light bill, and the children couldn’t live without heat. And they also had to pay for Cybil’s dance recital which she had been looking forward to all year. “Our kids need to come first.” Then they told me what a great landlord I was and said they were so appreciative of my understanding.
Brett, this story goes on, but I’ll bottom line it for you. The tenants are 5 months behind and I am beside myself and out of patience. I wish they would just get caught up! Where do I go from here?
First of all, there is nothing wrong with being a nice, understanding person. We have enough jerks in the world. And what’s done is done; it’s a sunk cost and it’s time to deal with the facts on the ground.
If the tenants are 5 months behind, it’s time to evict. There is no way that they can get caught up at this point. Find an eviction attorney (ask a property manager for a recommendation if you need one) and get the ball rolling ASAP. In NC, you could be looking at 6-8 weeks if the tenants prolong the process (and possibly longer if they know how to play the game). You need to get your house back and stop the bleeding.
A caveat- I don’t ever want to evict anyone. It’s expensive, it’s time-consuming, and it is a lose-lose-lose proposition (owner/property manager/tenant). At lease signings, I communicate to tenants that if they are having payment issues (life happens), to contact me immediately so we can work something out. Whether that means a payment plan, negotiated vacancy, or something else, we need to talk it out and negotiate a workable plan. We’ve worked things with tenants in the past that has made the best out of a difficult situation. Everybody needs a place to live.
But we’ll never get to 5 months of non-payment. It just can’t happen. Sympathy, at that point, turns into taking advantage of home owners, which isn’t fair.
Though every tenancy situation is different, there are a few non-negotiable parameters:
- Non-payment can never get past 30 days. That’s 2 pay periods and past the point of return for most tenants.
- If a payment or negotiated vacancy plan is agreed upon, it is set in stone. If the plan is breached (for any reason), eviction must be filed.
- Don’t take it personally. Rental properties are a business and sometimes business stinks.
I am all for sympathy. But with rental homes, sympathy can kill your business if not used with moderation.
Brett Furniss is the head property manager of BDF Realty (Charlotte Residential Property Management), the trusted real estate advisor for Charlotte landlords & Home of $100 Flat Fee Property Management. BDF Realty utilizes their innovative Pod System for exceptional customer service in residential property management, home repairs, and home sales for single-family homes, Uptown condos, and town homes in the Charlotte-Metro Area. Contact Us Today!
Learn MoreCharlotte Section 8 Leases: Should I Renew Them?
“Enjoy Free Rent!”
(Former advertisement to entice landlords to put their houses in the Charlotte Section 8 program)
Q: My Section 8 tenant’s lease is set to expire next month. Should I offer to renew it?
A: Maybe…
As a Charlotte-based property manager and real estate investor, I’m a huge proponent of renewing leases. I think it makes unbelievable financial sense; there is no missed rent from vacancies, no fix-up and holding costs, no management costs for landing new tenants, and it provides the ability to raise rents to stay around market rate. And it also saves everyone a lot of work. Whew!!
It really takes a lot of chronic tenant wrongs for me not to recommend renewing a lease. Besides situations where an owner wants to move into their property or sell it, I can count on one hand the number the tenants I’ve not recommended renewing. If a tenant wants to renew at market price, I’m asking where I should send the new lease. It’s typically a done deal.
So when I was asked the other day whether I’d recommend offering to renew a client’s Section 8 lease, my fingers naturally wandered to the “Y”, “E”, and “S” keys on my laptop. Then they stopped and I felt my stomach cramp up. Can I really recommend this for this property? The issues:
- The rent is not close to market rate even after filling out the moderately arduous Section 8 paperwork for an increase every year. The Section 8 paperwork says we can ask for a maximum 5% increase a year; we’ve only been getting approved at 2% increases ($800.00 rent turns into $816.00- woo-hoo!). And this is after increases were frozen a year or two ago, while private market rents (aka non-Section 8) have been going up by 10-20% for the past few years.
- Annual Section 8 inspections are a hassle and seem to always result in a “fail” for trivial issues. A true example of a recent “fail”: “paint is peeling on the ceiling.” In a non-Section 8 world, if peeling paint on a ceiling was bothering a tenant, they would be told they were free to grab the extra paint can in their garage and touch it up. In a Section 8 world, that is a “landlord responsibility” and a handyman must be sent out or rent payments will go into “abatement”. Abatement is a very bad place to be as no rent comes in and past payments are clawed back (which would never happen in the private sector).
Unfortunately, landlords and property managers have figured out that:
Less Money + More Expenses + Government Regulations/Paperwork = Bad Deal
It’s not just Charlotte. In Austin, Texas, there was a law made (that was later repealed) that required landlords to accept Section 8 tenants. A study the city commissioned said that 90% of Austin landlords would not accept Section 8. Due to the fact that most landlords are investing in real estate to maximize their financial return, this is not surprising.
So as property managers whose job it is to maximize our clients’ ROI, we stopped recommending Section 8 as a source of new tenants several years ago. As discussed, the financial numbers didn’t add up. However, we did allow Section 8 tenants who wanted to stay to continue to renew their leases if they chose to.
But should we continue to recommend allowing renewals? It really comes down to whether the owner wants to expend the funds to fix-up the property and take the hit of vacancy until a new, non-Section 8 tenant comes on board. Some, including me, have continued to renew the Section 8 leases until the tenant decided to not renew and vacate; and then, once vacant, go exclusively to the private market going forward. But if the rent differential continues to grow between Section 8 and market rate rent, the auto-renewal policy will need to be revisited if the Section 8 tenants still want to extend their leases.
It’s tough to disrupt rental continuity and I don’t usually recommend it, but it may ultimately pay to take a closer look at the numbers before rubber-stamping your Section 8 lease renewal!
Brett Furniss is the head property manager of BDF Realty (Charlotte Residential Property Management), the trusted real estate advisor for Charlotte landlords & Home of $100 Flat Fee Property Management. BDF Realty utilizes their innovative Pod System for exceptional customer service in residential property management, home repairs, and home sales for single-family homes, Uptown condos, and town homes in the Charlotte-Metro Area. Contact Us Today!
Learn MoreDo You Want to Rent Your Charlotte Rental Home to Anthony?
Who needs a house out in Hackensack
Is that all you get with your money
It seems such a waste of time
If that’s what it’s all about
Mama if that’s movin’ up
Then I’m movin’ out
I’m movin’ out
“Movin’ Out (Anthony’s Song)” by Billy Joel
People move out and relocate for many reasons- a new job, real love (isn’t that sweet!), real love that really isn’t (not so sweet), the need for new scenery, the need to get out of town (Jack Bauer fleeing the US for the UK in Season 9 of 24), Anthony getting out of Mama’s house, etc…
And most of them, like Anthony, need to find a place to live. So property managers get rental applications from out-of-town folk and need to screen them. It seems like it would just be business as usual. But there are more factors to consider.
We’ll start with the basics:
- Credit check: Anthony saves his pennies, so I’m optimistic.
- Criminal check: He seems frustrated, so we’ll have to see on this on.
The income check seems straightforward; people make what they make. But figuring out how much free cash flow is available can be muddled if the prospective tenants have financial baggage where they are coming from. For example, are they homeowners? That’s another house payment they are responsible for, and one that could rival where available funds would go if things got tight (pay for the house they own or pay rent for the one they don’t?). If they make enough to afford two house payments, that’s great. But most people don’t and it adds a layer of risk. Renting out or selling their out-of-town homes is an uncertain thing and can provide short and long term cash requirements. However, Anthony lives with Mama, so he’s good there with no extra house payment.
The employment screening also adds a potential issue. Unless the prospective tenant is in largely the same work position with the same boss at the same company, there is uncertainty on how things will pan out. When a prospective tenant has been in a job for a year or two, it shows they can get along, handle the job, and fit into the corporate culture. New jobs in new cities are a step into the unknown. And that creates a greater amount of risk. Is Anthony transferring to Charlotte with a position with the same grocer or does he hope to latch on with the local Harris Teeter? This adds some uncertainty to his application.
A quick caveat: “Risky” doesn’t necessarily mean bad. When I think of our best all-time tenants (sigh… love you guys!), many of them were relocators with the “issues” described above.
So what to do about Anthony? His credit score will be a big indicator. If he is in the 700-800 range, this tells me he knows how to handle his finances well and can make things work through potential adversity. If it’s in the 500’s, I’m more nervous.
And cash is king. How much in liquid assets does Anthony have? He can send bank/brokerage statements that can prove he has funds to fall back on or tide him over until he’s up and running in Charlotte.
Anthony may want to get out of the Tri-State area, shun Hackensack, and come to Charlotte, but smart landlords will want to check Anthony’s application closely. He may still need to stay in Mama’s house for a little longer to save more money, line up a job in Charlotte, and pay his bills on time to improve his credit score.
Brett Furniss is the head property manager of BDF Realty (Charlotte Residential Property Management), the trusted real estate advisor for Charlotte landlords & Home of $100 Flat Fee Property Management. BDF Realty utilizes their innovative Pod System for exceptional customer service in residential property management, home repairs, and home sales for single-family homes, Uptown condos, and town homes in the Charlotte-Metro Area. Contact Us Today!
Learn MoreYou Break It, You Bought It! Avoiding Rental Home Repair Costs
The dreaded scenario…
You enter the “4th Century Priceless Vases” store with your 3-year old child sleeping in his stroller. “While he’s sleeping I might as well find a birthday present for Uncle Milt,” you quietly say to yourself as you peruse the priceless artifacts (surprisingly all with prices on them…). As you turn to the shop owner to ask if there is a chance that the price of the orange vase had mistakenly had too many zeroes added to it (a simple clerical issue could happen to anyone!), you hear a crash behind you.
Looking at the shards of glass on the floor and your giggling, (temporarily) smiling son, you realize this could be an expensive trip. The shop owner, with arms crossed on his chest, points to the antique sign on the wall:
“You Break It, You Bought It!”
Ouch!
A better scenario for everyone would be that “4th Century Priceless Vases” decided years ago to elevate every shelf in the store to a minimum of 4 feet off the ground and added a feather-coated floor. The most expensive vases were put behind locked glass and could only be accessed by store personnel. This way they were able to decrease breakage and save money.
On a similar vein as a Charlotte property manager and fellow real estate investor, it pains me (sad, but true) when I get repair calls from tenants on things that could have been avoided. By spending money on features (“being nice”), it winds up costing in service calls and replacements for years.
My 3 main culprits on optional home amenities that always seem to break:
- Icemakers on refrigerators (ugh!!)
- Washers & dryers
- Gas fireplaces
Most leases say that if something is working when a tenant moves in, it is the landlord’s responsibility to pay to keep it working (aka “promptly repair all appliances and facilities” under Landlord Responsibilities in the NC standard Realtor lease). This costs money.
But what about if you took a page out of the “4th Century Priceless Vase” store’s playbook and made breaking these things close to impossible? Sounds good! But how?
Don’t own them! Nowhere in the lease does it say you have to have these things in your rental house. So don’t!
I see no rent difference in Charlotte single family residences in whether you have these niceties or not. So, I would highly recommend dealing with my main 3 culprits in the following manner:
- Icemaker on refrigerator: when you replace your refrigerator, get one without one!
- Washer & Dryer: sell them on Craig’s List the next time your house is vacant
- Gas fireplace: turn it off and let the tenant know it is not to be used. If they insist, let them know they are responsible for its upkeep.
Some parts of maximizing rental home ROI is addition by subtraction. It’s tough to break expensive vases when you can’t get to them, and you don’t need to perform maintenance on items that aren’t there. When there is less to break, there is less to be bought!
Brett Furniss is the head property manager of BDF Realty (Charlotte Residential Property Management), the trusted real estate advisor for Charlotte landlords & Home of $100 Flat Fee Property Management. BDF Realty utilizes their innovative Pod System for exceptional customer service in residential property management, home repairs, and home sales for single-family homes, Uptown condos, and town homes in the Charlotte-Metro Area. Contact Us Today!
Learn MoreProperty Management Wisdom: Pass That Peace Pipe With Your Tenant
If you’re feeling mad as a wet hen,
Mad as you can possibly get, then
Pass that peace pipe, bury that tomahawk
Like those Chichamecks, Cherokees,
Chapultepec’s do.
That cold shoulder never solved a single complaint.
When you’re older, you’ll wipe off all of that war paint.
(Hugh Martin – Pass That Peace Pipe Lyrics | MetroLyrics)
https://www.youtube.com/watch?v=wCNa-AT9hOQ&feature=player_embedded
Blessed are those who find wisdom, those who gain understanding,
for she is more profitable than silver and yields better returns than gold.
She is more precious than rubies; nothing you desire can compare with her.
Long life is in her right hand; in her left hand are riches and honor.
Her ways are pleasant ways, and all her paths are peace.
Proverbs 3:13-17 NIV
When I was a younger property manager starting out in Charlotte, I was all about the letter of the law (or in this case, the lease). “Follow it, or else!” “According to section 7.6, you are in breach of contract! Better get a lawyer!” “No payment yet? I’m sick of excuses!”
Property management can turn you into an ugly person. It’s really set up in a way that promotes divisiveness. Property managers are in one corner sparring for the owner’s (their client’s) interests. The tenant is fighting to protect their interests. Who pays to replace a burned out light bulb? You do! No! The thing was already burned out when I moved in! You should pay!
What I’ve found over the years is that being a stickler and jerk isn’t effective. It’s bad policy, both professionally and personally.
Through the years (much like King Solomon’s advice above), I’ve found the wise path is to take actions that promote pleasantness and peace, whenever possible. It’s more profitable and much less stressful!
To keep the peace, keep the following in mind:
- When e-mails start getting negative, stem the tide and pick up the phone. The game of “who is smarter/snarkier” in e-mails with your tenant is a game of LOSERS played by LOSERS. If you must, save your “clever writing” for a novel (or your property management blog).
- “Seek first to understand, then to be understood.” (Stephen Covey). We argue about problems. Problems need solutions. Listening to the tenant’s needs and thoughts provides more information to formulate peaceable solutions with. Enough said.
- Real professionals come up with compromises that can work for both parties. This is where property management becomes art, as opposed to robotic, Draconian ruthlessness. No one said property management has to be a zero sum game where one party loses and the other wins. He who lives by the sword, dies by the sword.
So, bury the hatchet and try to work issues out nicely. Pass the peace pipe with your tenant and enjoy the rewards!
Brett Furniss is the head property manager of BDF Realty (Charlotte Residential Property Management), the trusted real estate advisor for Charlotte landlords & Home of $100 Flat Fee Property Management. BDF Realty utilizes their innovative Pod System for exceptional customer service in residential property management, home repairs, and home sales for single-family homes, condos, and town homes in the Charlotte-Metro Area. Contact Us Today!
Learn More5 Important Steps Not To Forget After Locking In Your Rental Tenant (With Extra Credit)
I finally did it! I found a tenant! Now good times are here! I can just sit back and spend the rent money. Oh yeah!
(Landlord reaction after placing a tenant into her rental home)
It is a good feeling getting your rental home filled! The house preparation, the marketing, the showings, the rental screening, the deposit collection… it’s exhausting, but usually means that you are in the clear from doing it again for at least a year. That’s something to celebrate!
Great tenant placement is about 75% of the heavy lifting good property managers do. Getting past this hurdle is a great accomplishment! If high standards were kept throughout the screening process, a fruitful, peaceful tenancy is extremely likely.
But after the bubbly has been consumed, the noise makers silenced, and the euphoric feelings have subsided, a question sometimes starts to gnaw at your innards:
What have I forgotten to do?
This is a perfectly normal reaction. And, fortunately, it has a very easy answer. Here are 5 important steps not to forget after you’ve locked in your rental tenant (with ways to earn extra credit):
- Make sure the new tenants know where, to whom, and when to send the rent checks. Priority #1!!
Extra Credit: Send a reminder 7-10 days prior to the due date every month (I like e-mail).
- Call your insurance company and let them know you need to change your policy from a home owner to a landlord. I haven’t seen any price changes personally from doing this. Extra Credit: Make sure your tenant has a renter’s insurance policy.
- Make sure all utilities are scheduled for shut off when the tenant moves in.
Extra Credit: Allow 3-5 days after the tenant’s move-in date to schedule the shut-off. It’s tough to live without utilities and moving time is busy. It’s perfectly decent to be thoughtful!
- Cut off the lawn service after the tenant moves in.
Extra Credit: Have the lawn mowed the day before tenant move-in. It’s a nice gesture and sets a precedent on how the lawn should be kept.
- Exhale and put your feet up! You’ve done it! Never miss an opportunity to celebrate!
Extra Credit: Head to your nearest Caribbean island ASAP.
Brett Furniss is the head property manager of BDF Realty (Charlotte Residential Property Management), the trusted real estate advisor for Charlotte landlords & Home of $100 Flat Fee Property Management. BDF Realty utilizes their innovative Pod System for exceptional customer service in residential property management, home repairs, and home sales for single-family homes, condos, and town homes in the Charlotte-Metro Area. Contact Us Today!
Learn More3 Thoughts to Determine Viable Tenant Repair Requests
“Honey, before you go out golfing today, there are a few things I’d like you to take care of around the house. The air conditioning is out upstairs, the front door squeaks, the gutters needs to be cleaned, the back latch is sticking, the front bushes need to be trimmed…”
(Cutting his wife off while rushing out the door) “Can’t you just put it in an e-mail and send it to the landlord? I assume that’s why we pay rent around here!?!? That nonsensical interruption may have just cost me a few practices hits with my new driver!”
I wish things worked for me like that. Something in my house breaks? Send an e-mail to the landlord and wait for the repairs to be addressed at no cost. And now that there is Wi-Fi on the golf course and the pool, this whole delegating thing would be even easier! Renting would really trump owning, that’s for sure.
I refer to this as “genie property management.” Get the lamp out, rub it a few times, and get countless free repair requests.
But much like a genie, this is (or should be) fiction. Landlords are not genies. With that being said, my three thoughts to determine viable tenant repair requests are:
- The landlord needs to keep the house at code. The major systems that worked (including appliances) should continue to work throughout the tenancy. That’s written into most leases to protect the tenant. Stay on the right side of the law! Plus, it’s the right thing to do.
- Myth: When renting a home, a tenant will never have to pay anything outside of rent and utilities for the house. That is very false. This expectation should be expressed explicitly during the lease signing. Both parties have responsibilities to each other. As it has been said, it takes two to tango.
- A good maintenance addendum to the lease is paramount to ward off even the scent of genie property management. Tenant repair and maintenance responsibilities should be spelled out explicitly so everyone is on the same page.
So that brings up the inevitable question: so (ha ha ha), you’re a proponent of “slumlord management”, are ye? Hardly! When tenants move into a home, every major system should work! If there was ever an expectation that something major wasn’t going to work, the tenant should know about it before signing the lease. And if one of the major systems breaks due to normal wear and tear during the lease, landlords should address it at their expense immediately. I would want that done for me if I was renting.
But what I’m not a proponent of is “slumlord tenancy” (ha ha ha?). Houses are expensive and need to be maintained. If a home inspection uncovers that the air filters have never been changed, the yard is unkempt, leaves are spilling out of the gutters, all light bulbs are burned out, etc. this is an issue! These are not landlord responsibilities. On-time rent is great (thanks!) but it doesn’t give a tenant license to ignore the other responsibilities in the lease and maintenance addendum. And if something breaks due to misuse (pouring hot oil down the garbage disposal, anyone?), I don’t think it is fair to expect the landlord to pay for it. That’s not normal wear and tear and it seems unreasonable for the responsible party to expect the landlord to pay the bill for that.
Yes, if I was renting, I would wish my landlord was a genie! But having Santa around to bring my family gifts in December each year would be a nice thing too.
Alas, all is not lost. It still can feel like Christmas year round. When each party does their part, the house stays maintained, things work well, and the Christmas spirit will abound for all!
BTW, the e-mail response to the tenants from their repair request:
Dear Valued Tenant,
Thank you for your e-mail sharing your repair issues. I’m sorry to hear about them. See my notes below:
- The AC upstairs- we will send someone out to fix it ASAP. Can the technician call you on the 5641 phone number we have on file?
- The front and back door: please try some WD-40 and spray the locks. That usually does the trick!
- The clogged gutters and front bushes: per the maintenance addendum signed with the lease, this is a tenant responsibility. Can you make sure they are taken care of ASAP? If you could e-mail us a few pictures after they are done, that would be great. The owner appreciates you taking care of the home and we need to make sure we are no one is fined by the HOA for non-compliance.
Thanks & have a great weekend!
Brett Furniss is the head property manager of BDF Realty (Charlotte Residential Property Management), the trusted real estate advisor for Charlotte landlords & Home of $100 Flat Fee Property Management. BDF Realty utilizes their innovative Pod System for exceptional customer service in residential property management, home repairs, and home sales for single-family homes, condos, and town homes in the Charlotte-Metro Area. Contact Us Today!
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