| ||
?'s for landlords and tenants
by Leander 7 Replies latest jw friends
-
Leander
-
Mimilly
Hi Leander. I've had experience being a landlord AND being a tenant. I'll try to answer some of your questions. But first I want you to decide what kind of a landlord YOU want to be. That will have a huge effect on how your own questions are answered.
Secondly - do not ever, EVER - go against safety codes. Always have fire escapes, smoke alarms etc. Check with your local Fire Dept. for the safety codes and go by them. It is not worth it to save a few dollars and then lose a few lives.
Thirdly - lease. Always have a lease. And always give rent receipts. You will have to decide if you want to be monthly, or yearly. This gives you legal clout if a tenant stiffs you.
Fourth - Always ... check references. Lots of problems can be avoided by checking up to three references on each person.
If someone doesn't pay - you take them to the tenancy board, give them legal time to get out, and stick to it. Now if you have a really nice tenant who is having a hard time (who isn' t these days), and will be a bit late with the rent, you could try allowing them a couple of grace points here. But if it continually happens - they have to leave. Bottom line is your credit is being affected.
A good idea is to use a camcorder to show what the place looked like before and after a tenant. If there is any severe damage - go to the tenancy board and you'll have this proof. Of course, there is always the damage deposit, which you should keep in a bank account and NOT touch.
People want affordability,comfort and safety. So long as things work and aren't filthy, it doesn't have to be fancy. I cannot stress how important it is to have all the safety features in place.
When someone calls to tell you such and such isn't working - get right on it. Make calls and have a repairman come, or if you can - do the repair yourself. People will not put up with being cold or having no water etc. Make a list of handymen in your area who will do jobs for a reasonable price.
Keep receipts for everything and keep them filed.
If you have trouble with a tenant - keep a journal on them with dates, statements etc. You will also find yourself being the ref between two tenants who can't get along. It is you who will have to make the calls on those ones.
If the area is surrounded by lawn - keep it trimmed. Keep the floors clean and any glass doors clean. You don't want to be a slumlord. You'd be surprised how simplicity and cleanliness will attract people to your building.
I hope this is of some help. If I can think of anything else, I'll post it.
Mimilly
-
finnrot
Congratulations Leander, it's scary at first but it'll get easier to manage them with time.
First off management companies are great for taking the burden of being a participating landlord off you, but don't be fooled when they tell you how cheap they are, they nickel and dime you with hidden charges every month, so I now avoid them. I prefer to find a nice older couple and make them my manager, they collect the rent, take care of small problems and maintain the property. In exchange I give them a lower rent.
When you take an application, look inside their car. If it look like a slob lives in the car, so will their apartment. Never give any prospective tennants any indication whether they are being considered or not, if they ask, just tell them you are still taking applications. If someone calls and asks why they didn't get the apartment, don't say anything negative. People are sue crazy these days, and you will get sued.
Also there are companies that provide a service for a fee, you give them a social security number and name and they will do a credit check for you over the phone. There is a monthly fee, but it's worth it.
It's best to get a first and last(rent), and a cleaning deposit also. Do a walkthrough before they move in and take pictures of the apartment while they are there so they know you have proof of the condition of the apartment.
If I want 1200.00 a month, then I will write into the contract that the rent is 1275.00, but if they pay their rent by the 3rd of the month then they get $75.00 discount.
And go buy landlording for dummies and read it, you will learn valuable lessons, that might help keep you from getting into trouble.
-fin
-
Amazing
Hi Leander: First, I sent you several email, and wondered why you did not answer? Now to your questions:
Next month I'll be taking the plunge and purchasing my first multi-unit building. I've done some research on the area of landlording but as they say "experience is the best teacher".
I am curious and surprised as to why you would buy a multi-unit in the Chicago area.
So for those of you who have rented out to others before what would you say is the worst aspect of landlording?
When they fail to pay rent, especially on time, and you have to pay a late fee to the bank. This is followed by mistreatment of the property, and then in Chicago area you cannot evict from November through April ... and Tenants know this and they can refurse to pay rent for six months and you can't touch them. This is not true in commercial.
How do you deal with people who don't pay or are slow with the rent?
It depends on each situation. Some are struggling for a time and you can work with them, and others are much more difficult and very hard to work with. Knowing how to properly check them out prior to renting to them helps in preventing many problems. However, if an average tenant has problems with the rent after being good for a while, it is likely a job loss or some crisis. And you are not going to ever get the money.
On average what would you say the condition of your property is like once a tenant leaves?
In residential it is usually messy beyound normal wear and tear and requires using some of the cleaning and security deposit. There are ways to deal with this up front in addition to a large security deposit ... you can take other steps to assure that the property is left in reasonably good condition.
To kind of flip it around here are few questions for tenants. Does it take a long time for your landlord to take care of problems that arise within your apartment?
Yes, in many cases in residential.
If a landlord offered free cable or other amneties (sp?) would you be more inclined to move into a slightly less attractive apartment?
Maybe, if the price is right and the location is not too bad.
What would you like to see a landlord do more of in the future? (rent reductions for early payments, cleaner buildings, quicker response to apartment issues, etc..)
Most tenants I work with prefer no rent increase as opposed to rent reduction, although no one minds rent reduction. Response to building issues, fixing problems is most appreciated.
Anyway Leander, I hope you will call me again, and talk. Thanks.
PS: Mimilly is correct about safety codes ... but I recommend going a step further, and ask the City (Village) building and Zoning department to inspect any building you are about to buy for all code compliance, because once you buy, you are stuck with the issues ... and if you used a Realtor to buy, you should have been advised to engage in this level of due dilligence.
-
JeffT
Hi. E-mail me if you want, I've been working in multi-family real estate since 1984. The first thing you need to do is find out what the laws are in your area. One screw up and you can be up to your ass in alligators in five minutes. Put together a management plan for your building and have an accountant look at it. Hire a sreening company to check your potential tenants. If you don't your building will be a magnet for all the people who won't pass muster anywhere else. Take care of upkeep ASAP. If you let repair issue linger the building will get rundown, you'll have to lower the rent, then you'll have even less money to do repairs... you get the idea.
Good luck to you.
-
josephus
hi
i am a landlord at present and plan to buy more property shortly. i can recommend letting agents heartily.
the thing to do is get to know and like your agent, and demand a huge security.
my one and only tenant is a good guy but gets assistance for his rent, im happy as it comes to me every month like clockwork.
once again know your tenant. know your letting agent, and charge a big security.
good luck
josephus
-
Oroborus21
Hi Leander,
Jeff T gave you excellent advice. There also may be local Property Management groups or Landlord Associations or some type of business association that can give you lots of help.
As Jeff said and I will repeat one MAJOR thing is to find out all about the law in this area. From disputes, notice requirments, rent increases, deposit returns, fair housing laws, etc. etc. there are many many laws that are going to apply and you need to learn these and whether they apply to you (some don't depending on the size of your MDU) etc. Organize everything meticulously and do everything in writing using acceptable forms.
Now this is a particular issue you mentioned and this if for the United States only:
The Satellite Home Viewers Act passed a couple of years ago makes it the law that a renter has the absolute right (save demonstrated safety or "historic site" exceptions) to install a direct-broadcast satellite for reception of these signals in any location that they can exercise "exclusive control" i.e. not common areas, not the roof, etc. So if there are south facing balconies or windows you may face this issue.
With regards to CABLE TV. There is NO right of entry on the part of the Cable TV company to private property (other than existing easement rights) nor right of reception on the part of residents, so even if Cable TV was run previously you can pursue the following options:
1. do nothing and whenever the renter orders Cable for their apartments the cable company will connect to existing lines, or worse, run new lines, perhaps punching holes in your building, stapling it to the side, etc.
2. Serve the Cable Company with notice to remove their cables (they own it to the demarcation point) AND offer to negotiate a contract with them to gain entry to your property and to serve your residents. This option could result in anything from free cable service for you to a slice of the income they derive from your residents. (Also keep in mind these days we are not just talking cable TV service but also cable modem service and in some cases telephone service.)
3. Negotiate a deal where they wire EVERY unit and every unit MUST take cable service. Usually this means the cable service will be at a discount rate (since the Cable co gets 100% penetration) and you just build it into the price of the rental unit--specify this in writing. If you wanted you could charge the difference between the cost the Cable company bills you and the market price and make a nice profit. If you do this option though, make sure you keep an eye on the converter boxes, each worth $250-500 a piece and that none of your tenants walk off with them or the company will hold you responsible for the equipment.
4. Consider installing a SMATV or Satellite Master Antennae System. Essentially you make a deal with a direct broadcast satellite service and bring in the satellite channels via one satellite on the roof of the complex with each apartment wired. You supplement the sat channels with a nice roof antennae to pick up all of the local broadcast signals. Congratulations you have just created your very own "cable television system" and you can charge your residents anything you want to charge them for it. (They can't get cable from the cable company--since you haven't permitted the cable company to encroach on your property, and unless they have a place of their own that is south facing they can't put up their own DBS dish.)
If you really wanted to be an Uber-Landlord, arrange for a T1 or at least DSL connection (or maybe the DBS company can offer high-speed downstream transmission) to your building to a local hub and make all of your units a LAN and offer high-speed connectivety to the Internet. That way all of your residents can have very fast page loads of Jehovahs-Witnesses.com
--Eduardo
-
Valis
Maybe this helps?
Sincerely,
District Overbeer