The Landabout Blog

Making Property Management Manageable.

Good reads: This week in property management

Fun landlord find of the week:  Boom!  WWII explosives.

Speaking of boom, rent at gunpoint?

And…no less explosive:  A very chilly lawsuit in NY.

The good news is a mile high:  Rental outlook positive in Denver.

Rethinking the 60 day notice…death should probably get y0u off the hook.

Is the rent too damn high?  Meet Rent-O-Meter, tenant tool that can come in handy on the other side as well.

Looking to rent the perfect spot for a heroin packaging mill?  The first step is choosing a low profile location.

Not loving the satellite dish bouquet look?  DirectTV hopes they have your answer.

 

 

Filed under: General Information, Landabout Features, Links, Property Maintenance, Property Management Topics, Ramblings, Real Estate Investment, , , , , , , , , , , , ,

Raising the rent: The smoothest ways to handle one of your bumpiest tasks

It happens to all of us, everywhere. A few more pennies for milk, an extra dollar to fill up your tank. The cost of living our lives changes regularly, and the cost of doing business is no different. As a result, you will eventually find yourself in the position of asking your tenants to pay more in rent. Despite the fact that they will greet the news with no more enthusiasm than you do when you pay that extra dollar at the pump, at the end of the day most tenants will accept reasonable increases as a normal and predictable shift in their cost of living.

For your part, failing to initiate rental adjustments because of a fear of confrontation or vacancy makes very little business sense and can cost you thousands. Undercharging becomes a greater hurdle with each passing lease period, as the market continues to command more around you and your tenants become even more comfortable and complacent (and far more likely to balk at change, when it does come). Charging slightly less than market comps to keep tenants is a good strategy, charging significantly less is foolish. Do the math and determine which is more expensive–a five year tenant underpaying by $600 a year, or the cost of attracting a new tenant who will pay what your property is worth.

Naturally, you can remove this task from the “fun” column. It will never be pleasant, and you can count on some fallout. Fortunately, there are ways to make it as trouble-free as possible for both sides, and in some situations maybe even as (relatively) painless as shelling out that extra nickel for a gallon of milk.

Tips and tricks for when it’s time to raise the rent:

  • Prepare in advance for vacancies created by those already at the top of their spending limit. With each rent increase, you should assume that you will not have 100% retention. Keep your advertising, marketing, and social media efforts strong at all times to keep your pipeline of prospective tenants full
  • Rent increases can be structured annually, biannually, or at your own chosen intervals taking economic & market conditions into consideration. Whatever increase schedule you choose, remember that the longer you wait between adjustments the greater the likelihood of pushback
  • Do not schedule increases for fall and winter, or in the middle of a lease term. In addition to the cruelty factor in forcing your tenants to amend their budgets around the holidays, if they do choose to leave, units that turn over in the colder months are more likely to stay vacant until spring
  • If using a lease from a book or online form library, study the rent adjustment language closely and make any necessary corrections to section(s) that would bar you from making increases. If you’ve just taken over a property, be mindful of the language in tenants’ existing leases and make changes at renewal time. Discuss changes clearly with tenants before they sign a new lease under your management
  • Plan to give your tenants more notice than your state requires when preparing for a rent increase, a policy that helps all involved. Most states require 30-90 days, but if you don’t have an annual planned increase try to exceed the required period of notice. Some would say this gives the tenant extra time to drop their renewal and find a new place to live, but know that it works both ways…you’ll have extra time to replace tenants who don’t choose to stay
  • Weigh the benefits of freezing an rent hike in exchange for a longer lease period. If tenant loyalty is a goal over cashflow, give your tenant the opportunity to lock in for 18-24 months and enjoy the security of having rented unit for a longer period of time
  • Keep all things equal. It’s never a good idea to raise the rent for some tenants and not for others (obvious exceptions being optional long term lease freezes mentioned above). Tenants will talk, and not only is an arbitrary rent increase system a lawsuit waiting to happen, it’s generally an unfair business practice. If you’re using rent increases to chase away problem tenants, it’s best to look into other ways to tighten the screws
  • Check on and stay up to date with local rent control requirements. Rent control in your region is likely something you’re already on top of as an owner or property manager, but as with most regulation it’s very costly to be misinformed or uninformed
  • As a rule, gradual increases are better received than large jumps. Your tenants live by a budget just as you do, and tweaking the balance sheet by $25 each month is generally easier to swallow than, say, a larger amount like $100. Naturally the real figures vary wildly, but bear in mind that some of your tenants may already be spending up to 40%-50% of their take home pay on housing. Jumps in rent of even 10-15% can turn a spending plan that’s already tight on its head

Above all, the bottom line is that you are in the property management business to turn a profit and provide a service.  Rent increases are a necessary evil, and you should not be apologetic about running your business in a fiscally prudent manner.

Filed under: General Information, Landabout Features, Property Maintenance, Property Management Topics, Ramblings, Real Estate Investment, Urban Renewal, , , , , , , , , , , , , ,

Successfully taking the “zombie” out of property management


As a property manager, you’ve probably seen everything. In a world with deity-laced grilled cheese sandwiches and television shows about women who turn their uteruses into clown cars, protecting oneself and one’s property from the ever rising tide of crazy is no longer as straightforward as it used to be. It could even be said that the statement, “When hell is full, the Undead will walk the Earth” has never been more real. While we don’t have access to the data, chances are good that things are close to capacity downstairs. Therefore, it’s best to prepare, do your research, and be willing to pound some zombie cranium if duty calls.

Surviving a zombie attack begins with recognition. Knowing your enemy is the first step, and, fortunately for us humans, zombies aren’t practiced in camouflage. A zombie will display a set of very distinct characteristics, but what separates the victims from the survivors is the ability to know them at a glance and take serious, immediate action. Because zombies can be mistaken fairly easily for your garden variety vagrant or drunk, pay particular attention to a subject’s keen, unnatural interest in brains and his or her indifference to the odor and unsightly nature of decomposing flesh. A zombie is also far less personable than a drunk, and will lack even the most basic communication skills.

Immediately following confirmation of an attack, know that you will not have a great deal of time to collect yourself. This is why preparation is so imperative, but more on that later. As a human, you possess a number of skills that will play to your advantage. The first is your brain (ironically the one bit of you your enemy craves). Learn to recognize the weapon in everyday objects, and look for creative barricading solutions. By choosing to stay with your property and defend it, you are accepting a challenge, but not an insurmountable one. Please note that you should never use a basement as a bunker, or any area that has an entrance but no exit. If you are forced to flee, choose a path with a low zombie density, arm yourself, and move quickly. Their erratic form of locomotion makes most zombies slow, and outrunning them shouldn’t be a concern. Keep your eyes open, and know your route before you go.

The first step in defense is reinforcing all windows and doors and collecting your survival materials. Because there are a number of tasks to manage in a very short time, you should take on this project with as many uninfected buddies as possible. Remember that reanimation can take up to 24 hours, so make it clear to all of those on your team that anyone presenting with zombie symptoms will be taken out immediately, no questions asked. Members of your group will learn very quickly that a zombie attack allows for none of the following: emotion, nostalgia, or jokes.

To lock down your building, preparing in advance is the key. For property managers, we recommend filling a storage unit on premises with zombie attack essentials. Note: Unless prospective tenants ask about zombie readiness, it is best to omit this information during tours and showings. A complete zombie preparedness kit should include:

  • A dozen or more rechargeable chainsaws. Keep an eye out for sales and ask about buying in bulk. While guns and other firearms are effective when aimed correctly, it is difficult to keep the amount of ammunition on hand required to withstand a long-term attack, and you’ll likely find yourself in the midst of the paperwork hassle of an FBI watchlist.
  • Stackable 5 gallon buckets for water collection. Gathering as much tap water as possible as quickly as possible should be a priority. Assume that all municipal utilities and systems will be lost almost immediately. Also on this note, prepare to shed any ideas you maintain about modesty and toilet use.
  • A collection of coats, pants and other clothing made of a sturdy material such as leather, as well as a number of cycling and other helmets. Designs should offer cover to more vulnerable parts of the body like the neck and arms, and most importantly, your head. These items have the added advantage of being easily explained away to the suspicious, as you have simply been saving them to donate to a disadvantaged motorcylists’ club.
  • Foodstuffs that will not break down over a term of days, months, or even years, and (for the most severe attacks) seeds and soil for indoor gardening. Foods with long term staying power include Twinkies and Ding Dongs, or essentially anything with a name that sounds more like an insult than a snack.
  • A supply of random, innocuous garden tools, crowbars, and combustible cleaning products to use as a backup weapon supply. These items will chop and burn things nicely and run solely on human power, a plus if or when your supplies run scarce.

In terms of additional preparation, take note of any tenants and neighbors who may exhibit a predilection toward zombie safety and awareness. These people may ask you about extra storage space for the 1,000 freeze dried military rations they purchased on eBay (just in case) or openly talk about helping a “friend” build a bomb shelter just before Y2K. These are the people who will be your trusted allies and partners in a zombie attack, so it’s wise to stay close.

Finally, some basics for surviving an attack that every property manager should know:

  • Location, location, location. Think carefully before investing in a property located near a cemetery or morgue. Because zombies will initially emerge from these areas, you’ve just purchased a little bit of zombie ground zero.
  • Make good use of outdoor mats and rugs. Not only will they reduce slippage and accidents for your tenants, they make for easy cleanup in the event of a brief zombie attack. Rinse and resume.
  • Practice cracking soft, slow, round things open. As everyone knows, the only way to permanently un-animate a zombie is to destroy its brain. This process will get easier over time, and rest assured the zombie you’re disposing of won’t feel a thing. Basic decapitation, while cool and satisfying, leaves you exposed to risk that the separated parts of the zombie will still function. If you opt to use this technique by accident or for sport, be sure to finish the job immediately. Zombies are as persistent as they are unattractive, and will pursue their pleasures even in the midst of serious injury.
  • In the end, zombie management is an every man for himself game. Choose your partners wisely and stay together for as long as possible, but always be ready to destroy some rotten brain—even if that rotten brain used to be the tenant who was always a month ahead on his rent and offered to help with the landscaping.

Reprinted from the Landabout Blog, 2009. Happy Halloween!

Filed under: General Information, Green Building, Landabout Features, Links, Mission Statement, Property Maintenance, Property Management Topics, Ramblings, Real Estate Investment, Urban Renewal, , , , , , , , , , , , , , , , , , , ,

The Long Arm of Liability

This recent news story got us thinking.  At times it seems as though we can never stay ahead of the curve when it comes to all of the ways humans can hurt themselves, preventable and otherwise.  When you own property, you automatically have a greater interest in that curve, and even though landlords and property managers must be found negligent when it comes to paying for an injury, we’ve all taken in enough news to know that a skilled attorney can pull “negligence” out of a hat.

To break it down further, there are actually several conditions that must be met when it comes to liability.  First, as a landlord or property manager you must have been negligent in maintaining the property, and that negligence must have caused the injury.  Think crumbling steps or falling icicles, and then the other innumerable conditions that may invite an accident.  Let’s say the condition that caused the accident was your responsibility (repairing the concrete, removing the icicles) and you didn’t take reasonable steps to meet that responsibility.  If the cost and effort involved to carry out the fix is not unreasonable, the accident was predictable/preventable, and a genuine injury or loss occurred, you could very well be found liable.  It’s at this point that even shallow pockets will be regarded as deep, and the legal headaches will be many.

If you’re a truly brave soul, just Google the words “landlord sued” and discover how long the arm of liability can be.  In a litigious society, no article or checklist can shield you entirely from legal woes, and for digestive and coronary health we don’t recommend doing that Google search.  Instead, here are three of the tougher liability categories we’ve seen, plus a short list of reminders to help you protect your tenants, yourself, and your business.

1.  Rental property owners are being sued more and more often when their tenants become victims of crime.  Landlords are responsible, to some degree, for preventing crime and assault on or around the property, and if problems are recurrent or increasingly severe they are more likely to be liable.

2.  Drug activity, and keeping tenants safe from other tenants, is the new hot button issue for property managers and police departments alike.  In fact, a person need not even be your tenant to sue for the “public nuisance” of drug dealing in the area.  Think of having drug crimes on your property as tantamount to leaving a barrel of sewage on the front walk and not doing anything about it.  In especially egregious cases, your property may even be vulnerable to federal government seizure.

3.  Aggressive dogs and dangerous animals could be a post unto themselves.  Thankfully, courts will often give landlords the benefit of the doubt when it comes to meeting the requirements for pet injury liability.  In most cases, a landlord has to have known of an animal’s dangerous tendencies and/or be “harboring”—or in some way caring for—and/ or essentially letting the animal live on the premises on a second chance basis.

What You Can Do:

  • Protect yourself with a comprehensive insurance policy, read it carefully, and ask questions of your agent.  Update when your business updates, and do not underinsure.  For more on property management insurance, see this post on the Landabout blog.
  • Use a written (secured electronic is best) unit inspection checklist and take the time to complete it on a regular basis with long term tenants and always when a unit turns over
  • Keep a written (secured electronic is best) list of tenant complaints, and record the dates, manner, and personnel involved in completion.  Keep these records for a minimum of five years.  A property management software system like Landabout can easily facilitate such record keeping
  • Set a “24 hours or less” policy for answering safety related maintenance calls.  If your staff is unavailable, outsource the repair and pay any after hours fees, which would pale in comparison to a lawsuit
  • Clearly state your company’s policies on maintenance and repairs within your lease/rental agreement and make efficiency and solid repairs a priority.  Bandaid repairs can often backfire and become far more expensive in the long run
  • Maintain a security system appropriate for the area your property is located in, and encourage personal responsibility by providing tenants with information on keeping their homes and possessions secure
  • Hire onsite security staff if crime or vandalism is a problem or becomes one.  You may find that tenants will voluntarily pay more in rent for safer surroundings
  • Invest in and carefully adhere to a careful tenant screening process.  Investigate all reports of disruptive behaviors promptly, and take action if suspicious activity persists
  • Include explicit guidelines in your lease/rental agreements regarding pets, should you choose to allow them.  Offer absolutely, positively NO wiggle room when it comes to animal aggression and injury to anyone living in or visiting your property.  Take action at the first (and only) report.  Remember that your tenant does not necessarily need to leave, but the animal does

Filed under: General Information, Landabout Features, Links, Property Maintenance, Property Management Topics, Real Estate Investment, Urban Renewal, , , , , , , , , , , , , , , ,

Good reads: This week in property management

Have we exhaled yet?  Nope, it appears potential buyers still renting.

Go Pack Go…rent your game day digs now.

Two words you just don’t hear together that often: vacant and Manhattan.

The ongoing saga of the landlord and the weed takes to the streets.

That’s a whole lotta lead!  Landlord takes EPA fine of $83K for violations. If that doesn’t make you spit out your coffee, try $164K in asbestos.

From NY, shocking vandalism indeed: Swastikas!?

Landlord shares the rap on pitbull cruelty charge.  Nevermind, here’s a truly horrifying tenant pet story.

Meaningful discussion comes from “garbage properties” accusation hurled in Dubuque, IA.

Filed under: General Information, Green Building, Landabout Features, Links, Mission Statement, Property Maintenance, Property Management Topics, Ramblings, Real Estate Investment, Urban Renewal, , , , , , , , , , , , , , , , , ,

Good reads: This week in property management

Mold and sewage and Hermine and…gardening? Oh my, landord can be a dirty job.  Sometimes, a little too dirty.

Good landlord alert:  An act of kindness in Louisiana.

Trend alert: Using a realtor for rentals.

Who turned up the heat in Chinatown?

When explosives in the apartment aren’t enough…  Alabama and eviction laws.

School’s back in session, and the targets have been identified.

Waiting for your shot at the show?  How about (sort of) free rent at the Reno Aces clubhouse.  Arizona DBacks 2nd baseman admits to squatting.

Santa Cruz becomes the latest city to monitor rentals.

Look, the horses were only in the bar for a minute.  Scottish landlord in trouble for horsing around.

Filed under: General Information, Landabout Features, Links, Property Maintenance, Property Management Topics, Ramblings, Real Estate Investment, Urban Renewal, , , , , , , , , , , , , , , , , , ,

Good reads: This week in property management

The immigration debate comes to Nebraska.

Ontario rents hold steady.

Would the right to rent stop the bleeding?

Summer’s Dangers:  A cautionary tale about extreme heat and your residents.  And, pool safety (or lack thereof) strikes again.

What are they looking for?  Apartment Guide reveals the top online searches renters tap into the keyboard.

Before it’s in ink, Dallas wants to talk about homeless housing.

Pinnacle fights back.

“Everything goes in here except dead bodies”–If it’s a question you have to ask when browsing tenant parking areas, there may be a problem.

To Peep or not to Peep:  Door decor verdict to come in soon.

Medically prescribed dogs:  don’t snub them.

You’d think this would be a solid business plan…No rent, therefore you’ll have to get your coffee from clothed people, says landlord.

Filed under: General Information, Landabout Features, Links, Property Maintenance, Property Management Topics, Ramblings, Real Estate Investment, Urban Renewal, , , , , , , , , , , , , , , , ,

Good reads: This week in property management

Smoking’s role in asthma, and what NY plans to ask landlords to do about it.

A normal tenant, until he totally wasn’t.  Renting to the accused Times Square bomber.

Amid complaints, Austin landlords come together to sketch out good neighbor policies.

That’s how we roll:  Facing liability concerns, Coney Island roller rink landlord has to say no to business.

Higher rent no, a tentative block in LA.  In NY, a similar topic to a panel that’s grown accustomed to being despised.

We knew Atlantic City was a hot spot, but this isn’t in the good way.  Big failures when it comes to passing fire inspections.

We like the sounds of this:  It’s a great time to be a landlord.  And recovery, now there’s a good word.  So is stability.

Always a fresh topic:  What *is* “normal wear and tear”?

The other coast looks at buy vs. rent.  From the middle, a look at the benefits of multi-family investment in a down economy. 

A peek inside what appears to be catching on quickly…green multi-family in NC.

In Chicago, renters seem to be taking the brunt of the foreclosure crisis.

The Landabout Blog will be back next week with more news and information property managers can use.  If you are interested in learning more about Landabout Property Management Software, please contact us at info@landabout.com.

Filed under: General Information, Green Building, Landabout Features, Links, Property Maintenance, Property Management Topics, Ramblings, Real Estate Investment, Urban Renewal, , , , , , , , , , , , , , , , ,

Three rules for the new leasing office

1. Divide and Conquer/Specialize

Leasing professionals have long been regarded as the type of individuals who know how to and are expected to roll up their sleeves and play with an all hands on deck mentality. On a given day, they might give 3 tours, draw up the paperwork for a few leases, field complaints, answer the incessantly ringing phone, and dispatch the maintenance crew. Or they might do this on a given half day. When they’re doing it all, the question becomes, “If given the chance, could they do just some of it even better?” If you have the luxury of employing several leasing pros, no doubt each of them has qualities that make them very suitable for dealing with all of your renters’ needs. But, perhaps one has a natural ability to deescalate conflict, or another has a real knack for closing the deal after a tour. Breaking out your staff into specialties—phone desk, sales, tenant management—can not only boost your customer service quotient dramatically, it can also make a calmer, more effective staff. Think about how your business would run if that daytime phone call rarely went to voicemail or your “ace” salespeople could be giving the biggest percentage of the tours. How much happier would your current tenants be if they had an immediate and direct point of contact to answer a question or respond to a problem, without having to wait for a tour to wrap up?

2. Everything online, all the time

In our 24 hour world, if your property information cannot be accessed and sold with a few clicks, someone else’s can. If you aren’t on the web, you’re way past deadline. If you are, make sure that your pricing, floorplans, and unit availability info are there with you. To earn significant bonus points, have all of it available in your leasing or sales office for those who know what they want even before they speak to one of your employees. “Available” can mean something as simple as a makeshift laptop kiosk at a comfortable desk, a place where any walk-in can see what you have to rent them and any tenant can report a repair or pay her rent.

To be clear, machines will never take the place of human beings, especially in a business as people-focused as property management. However, the Internet and technology in general has turned buying of every kind on its head. The first step in any sales process, in any decision in our time, can and does begin online.

3. Never stop training

In addition to making sure your employees can recite federal, state, and local fair housing laws and the best pizza joints in a five mile radius, invest in their development just as you do in other areas of your business. Next to your property itself, your employees are your greatest resource and the first (and sometimes only) customer facing impression of your organization. If we’ve learned anything from the recession and its resulting impact, it’s that the rules in business are constantly changing. What worked in leasing in 1995 will not work in 2010, and having your staff working by yesterday’s rules won’t do either. Invest in qualified consultants and experiment with new ideas. Even those that fail will teach you something.

Filed under: General Information, Landabout Features, Property Maintenance, Property Management Topics, Real Estate Investment, , , , , , , , , , , , , , ,

Good reads: This week in property management

Just as MSNBC announces that the gap between renting and buying is getting narrower, others may be using The Times’ interactive calendar to learn that it’s not necessarily the case in all markets.  In Hartford, and in Providence, they even put it in wage terms.  Talk about hot topics–the WSJ takes a look, too.

The Cubs aren’t the only ones who don’t miss him.  Milton Bradley is a Messy Milton.

In Seattle, protection for landlords whose tenants skip out on their bills.

Notes on becoming a landlord in DC.

Code fatigue prompts one CA landlord to fight back as she attempts to rehab.

Q & A:  the whole two wrongs thing…Yes, rent is still due in a foreclosure.

Who wouldn’t want to go to something called a Schmooze? The good news and optimism is just icing on the schmooze.

Filed under: General Information, Landabout Features, Links, Property Maintenance, Property Management Topics, Ramblings, Real Estate Investment, Urban Renewal, , , , , , , , , , , , , ,

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