Property for rent
Before deciding on which property manager to engage, it’s important to understand what services are required since not all property managers provide the same level of support.
Many owners use their rental property as a source of investment income and they’re mostly concerned about the bottom line. These owners are real estate investors whose primary motive is profit.
Then there are those owners, for example, who’ve been transferred by their jobs to a distant location. They don’t want to sell their home. They expect to return to it in the future. These owners are more interested in keeping their home in a good condition, and they want to rent it to tenants who’ll cover as much of their monthly mortgage payments as possible. These owners aren’t as profit-motivated as their real estate investor counterparts; these owners look forward to the day that they‘ll move back into their homes.
Property managers must be able to provide specific services to both investor and non-investor owners alike.
The investor-owner who is motivated by profit will accept almost any tenant who can pay the desired rent and who will not make costly demands on the owner. When repairs are needed or carpeting or appliances need to be replaced, this owner will expect the property manager to find the most cost-effective solutions in order to minimize expenses.
The non-investor homeowner, on the other hand, wants tenants who’ll take care of the home and who’ll pay the rent on time. For this owner, the property manager must exercise particular care in selecting the tenant. Although the rent will remain important, especially if it’s to pay some or all of the mortgage, this owner is more interested in a tenant who’ll take special care of the property. This owner may also spend more money for repairs and carpet and appliance replacements because this owner will eventually want to move back into the house.
Regardless of which type the owner is, the property manager must provide the following services:
· Awareness of the rental market - The same property will rent for different amounts of money depending on whether the rental market is brisk or whether it’s stagnant. A brisk market is one where the number of renters is greater then the number of rental units available. Competition for housing will consequently push the rent prices up. A stagnant market, on the other hand, is one where the number of rental units is greater then the number of renters available. Owners will then be forced to drop their rents in order to attract renters. Experienced property managers also keep an eye on home loan interest rates as well as on the home sales market. There is an inverse relationship between the real estate sales market and the rental market. When interest rates are low more buyers will qualify for a home loan. They will then not rent. In contrast, when interest rates rise, the purchasing power of buyers dwindle and the competition for rental units increases.· Screening rental applicants - Owners and property managers alike know that an empty house, at times, may be better than one filled with a bad tenant. When the property manager receives rental applications a series of investigations begin in order to prevent a bad tenant from moving into a rental. Foremost, a credit check is performed to determine how the applicant has managed previous bills, especially housing expenses. This is somewhat of an art in that not all less-than-perfect credits represent risks to an owner. An applicant may have a spotted credit history due to huge, unpaid medical bills stemming from severe illnesses. This applicant may still be a better candidate than someone who has consistently failed to pay their rent on time. Applications that are not perfect may be acceptable with the submission of double the amount of the security deposit, or the first and last month’s rent up front, or a combination of all of these.Next, the property manager should verify the applicant’s income, either with a confirmation letter from the employer or with copies of two years of income tax returns.. If there isn’t enough money at the end of the month to pay for next month’s rent then the landlord will soon be engaged in expensive collection activities. Finally, at least a two year review of the applicant’s previous tenancy should be investigated. A quick telephone call to the applicant’s previous landlords will indicate whether the rent was paid on time, whether the home was vacated in an acceptable manner and whether the applicant had honored all of the terms and conditions of the Lease.This up-front homework by the property manager, although tedious and often time consuming, may minimize the owner’s woes in the future.· Access to reliable, licensed, bonded and competitively-priced vendors - Things invariably go wrong with the home and it’s the property manager’s job to have these problems addressed in a timely and efficient manner. A good property manager will have a source of vendors such as plumbers, heating and air conditioning technicians, drywallers, yard maintainers, roofers, appliance repair services, general contractors and handymen who are qualified to repair or replace the many items that can and do go wrong with real estate.· After hours emergency contact ability by tenants - Although most property management offices are open, Monday through Friday from 9:00 am to 5:00 pm, it seems that most problems in a home occur at all other times, usually at night or during the early morning hours. An owner cannot afford to have a property manager who cannot or who will not address genuine emergencies at a moment’s notice. Delays in addressing flood problems, for instance, will mean higher expenses at a later time. The property manager must have a system that allows a tenant in distress to contact the appropriate person in the property management department at any time during the day or night and on holidays.· Home Inspections - A property manager cannot know what the state of a home is in unless there is a policy of regularly scheduled physical home inspections. At the very least, an initial inspection, prior to the tenant’s move in, should be conducted, and then an exit inspection should follow shortly after the tenant has vacated the premises. Conscientious property managers also schedule interim inspections at various times during the term of a lease. These inspections give the property manager, and thus the owner, an idea of how the tenant is maintaining the home. They also give the property manager an opportunity to discuss obvious problems with the tenant before they become unmanageable. Since initial and final inspections of a property determine whether the tenant will have the entire security deposit returned, or whether the property manager will withhold a certain amount for damages that were caused by the tenant, all inspections should be recorded in writing. They should also be augmented by photographs that clearly show the condition of the entire property. In our litigious society where proof wins over rhetoric, this type of recordation is mandatory.· Accounting - A good property manager should send the owner a monthly year-to-date accounting of all of the money that was paid by the tenant as rent and all of the money that was spent on behalf of the owner for maintenance and all other costs. · Communication - There isn’t a need to communicate with the owner every day or even every week, but it’s important that the property manager be diligent in communicating important information to the owner when the need arises. An especially convenient communication’s medium is email.· Maintain a good working relationship with the tenants - Although the property manager always represents the rental real estate interests of the owner it is important to maintain a good working relationship with the tenant. Angry or dissatisfied tenants will not renew their leases and will thus limit the income potential for the owner.
· Being aware of all federal, state and local laws affecting rental real estate - The owner of real estate does not enjoy exclusive rights over a renter anymore. Tenant complaints and civil court cases have fostered a more consumer-oriented rental environment than ever before. There are more lawsuits every year between owners and tenants than between buyers and sellers of real estate, and the laws in all the States of the US and all of the provinces of Canada reflect that. A professional property manager must stay informed of the laws and regulations that affect the rental real estate business. Failure to do so may ultimately cost the owner many thousands of dollars in fines that could have been prevented.
A property manager is a service provider who is charged with keeping an owner’s rental real estate interests always in perspective. Selecting an ineffectual one can make the rental experience for the owner a nightmare. Selecting a good one will earn an owner the highest possible rental income possible in any particular rental market while keeping the property in good condition.
rent back my property
When more than one home is owned, renting to paying tenants becomes a real possibility. It’s not an especially difficult task to manage rental real estate unless it’s more than a comfortable drive away. Then it becomes prudent to hire a professional property manager.
Before deciding on which property manager to engage, it’s important to understand what services are required since not all property managers provide the same level of support.
Many owners use their rental property as a source of investment income and they’re mostly concerned about the bottom line. These owners are real estate investors whose primary motive is profit.
Then there are those owners, for example, who’ve been transferred by their jobs to a distant location. They don’t want to sell their home. They expect to return to it in the future. These owners are more interested in keeping their home in a good condition, and they want to rent it to tenants who’ll cover as much of their monthly mortgage payments as possible. These owners aren’t as profit-motivated as their real estate investor counterparts; these owners look forward to the day that they‘ll move back into their homes.
Property managers must be able to provide specific services to both investor and non-investor owners alike.
The investor-owner who is motivated by profit will accept almost any tenant who can pay the desired rent and who will not make costly demands on the owner. When repairs are needed or carpeting or appliances need to be replaced, this owner will expect the property manager to find the most cost-effective solutions in order to minimize expenses.
The non-investor homeowner, on the other hand, wants tenants who’ll take care of the home and who’ll pay the rent on time. For this owner, the property manager must exercise particular care in selecting the tenant. Although the rent will remain important, especially if it’s to pay some or all of the mortgage, this owner is more interested in a tenant who’ll take special care of the property. This owner may also spend more money for repairs and carpet and appliance replacements because this owner will eventually want to move back into the house.
Regardless of which type the owner is, the property manager must provide the following services:
· Awareness of the rental market - The same property will rent for different amounts of money depending on whether the rental market is brisk or whether it’s stagnant. A brisk market is one where the number of renters is greater then the number of rental units available. Competition for housing will consequently push the rent prices up. A stagnant market, on the other hand, is one where the number of rental units is greater then the number of renters available. Owners will then be forced to drop their rents in order to attract renters. Experienced property managers also keep an eye on home loan interest rates as well as on the home sales market. There is an inverse relationship between the real estate sales market and the rental market. When interest rates are low more buyers will qualify for a home loan. They will then not rent. In contrast, when interest rates rise, the purchasing power of buyers dwindle and the competition for rental units increases.· Screening rental applicants - Owners and property managers alike know that an empty house, at times, may be better than one filled with a bad tenant. When the property manager receives rental applications a series of investigations begin in order to prevent a bad tenant from moving into a rental. Foremost, a credit check is performed to determine how the applicant has managed previous bills, especially housing expenses. This is somewhat of an art in that not all less-than-perfect credits represent risks to an owner. An applicant may have a spotted credit history due to huge, unpaid medical bills stemming from severe illnesses. This applicant may still be a better candidate than someone who has consistently failed to pay their rent on time. Applications that are not perfect may be acceptable with the submission of double the amount of the security deposit, or the first and last month’s rent up front, or a combination of all of these.Next, the property manager should verify the applicant’s income, either with a confirmation letter from the employer or with copies of two years of income tax returns.. If there isn’t enough money at the end of the month to pay for next month’s rent then the landlord will soon be engaged in expensive collection activities. Finally, at least a two year review of the applicant’s previous tenancy should be investigated. A quick telephone call to the applicant’s previous landlords will indicate whether the rent was paid on time, whether the home was vacated in an acceptable manner and whether the applicant had honored all of the terms and conditions of the Lease.This up-front homework by the property manager, although tedious and often time consuming, may minimize the owner’s woes in the future.· Access to reliable, licensed, bonded and competitively-priced vendors - Things invariably go wrong with the home and it’s the property manager’s job to have these problems addressed in a timely and efficient manner. A good property manager will have a source of vendors such as plumbers, heating and air conditioning technicians, drywallers, yard maintainers, roofers, appliance repair services, general contractors and handymen who are qualified to repair or replace the many items that can and do go wrong with real estate.· After hours emergency contact ability by tenants - Although most property management offices are open, Monday through Friday from 9:00 am to 5:00 pm, it seems that most problems in a home occur at all other times, usually at night or during the early morning hours. An owner cannot afford to have a property manager who cannot or who will not address genuine emergencies at a moment’s notice. Delays in addressing flood problems, for instance, will mean higher expenses at a later time. The property manager must have a system that allows a tenant in distress to contact the appropriate person in the property management department at any time during the day or night and on holidays.· Home Inspections - A property manager cannot know what the state of a home is in unless there is a policy of regularly scheduled physical home inspections. At the very least, an initial inspection, prior to the tenant’s move in, should be conducted, and then an exit inspection should follow shortly after the tenant has vacated the premises. Conscientious property managers also schedule interim inspections at various times during the term of a lease. These inspections give the property manager, and thus the owner, an idea of how the tenant is maintaining the home. They also give the property manager an opportunity to discuss obvious problems with the tenant before they become unmanageable. Since initial and final inspections of a property determine whether the tenant will have the entire security deposit returned, or whether the property manager will withhold a certain amount for damages that were caused by the tenant, all inspections should be recorded in writing. They should also be augmented by photographs that clearly show the condition of the entire property. In our litigious society where proof wins over rhetoric, this type of recordation is mandatory.· Accounting - A good property manager should send the owner a monthly year-to-date accounting of all of the money that was paid by the tenant as rent and all of the money that was spent on behalf of the owner for maintenance and all other costs. · Communication - There isn’t a need to communicate with the owner every day or even every week, but it’s important that the property manager be diligent in communicating important information to the owner when the need arises. An especially convenient communication’s medium is email.· Maintain a good working relationship with the tenants - Although the property manager always represents the rental real estate interests of the owner it is important to maintain a good working relationship with the tenant. Angry or dissatisfied tenants will not renew their leases and will thus limit the income potential for the owner.
· Being aware of all federal, state and local laws affecting rental real estate - The owner of real estate does not enjoy exclusive rights over a renter anymore. Tenant complaints and civil court cases have fostered a more consumer-oriented rental environment than ever before. There are more lawsuits every year between owners and tenants than between buyers and sellers of real estate, and the laws in all the States of the US and all of the provinces of Canada reflect that. A professional property manager must stay informed of the laws and regulations that affect the rental real estate business. Failure to do so may ultimately cost the owner many thousands of dollars in fines that could have been prevented.
A property manager is a service provider who is charged with keeping an owner’s rental real estate interests always in perspective. Selecting an ineffectual one can make the rental experience for the owner a nightmare. Selecting a good one will earn an owner the highest possible rental income possible in any particular rental market while keeping the property in good condition.
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