Suggestions for landlords, especially new ones

[HLS]

The best way to increase your odds of having a problem tenant is to have the lowest rent.
The lower your rental rate is the more applicants you will have.

The more applicants you have, the more confused you will be about who is the best choice and believe it or not, the more likely you are to be slapped with a lawsuit for discrimination by someone you turned down.
In a land where anybody can sue anybody for the cost of filing, there are perils.

My suggestion is to maintain the properties that you own. Charge top rent and let the tenants know that you do this but will maintain the property if there are any issues, and don’t get emotionally involved with your tenants (and their problems)

You might want to have someone else show the property for you and take applications.
Review the applications before you meet the applicants face to face. Charge an application fee to cover the cost of running their credit (with their permission) and require proof of income.

Charge the maximum late fee that you can and NEVER ever. EVER waive a late fee.
If rent is due on the 1st but not late until the 5th, you can still deliver a 3 day notice on the 2nd.

Do not EVER let the inmate run the asylum.
I believe that month to month agreements are better for the landlord in many cases.

With a lease you cannot get rid of a miserable tenant as long as they are paying their rent
(unless a violation of lease, which they often correct)
My longest month to month tenant stayed over 13 years and only moved because I sold the property.

A happy tenant may stay longer than they thought without the pressure of a lease.
If they don’t want to be at my property for any reason then I don’t want them there either.

Don’t screw tenants out of their security deposit.
The rent they pay you INCLUDES wear and tear.
Be fair with what you charge them for.
They probably need it worse than you do, and I believe in karma.

If you are uncomfortable charging high rent, another option is to offer a half month or full month credit after 12 months of paid rent on time.
Baker’s dozen. 13th month credit. Equates to a 3.85% or 7.7% discount.

Don’t micro manage your property and keep tenants waiting when a repair needs to be made because you cannot get over there to fix it yourself.
Find a good handyman that is available to go check out the problem and provide a temporary solution quickly if a follow up by a professional is required.

If your tenant is inconvenienced by a flood or interior damage, hop on Priceline and find them a decent place to stay for a couple of nights without them having to ask you for this, and apologize for the inconvenience.

MOST IMPORTANTLY: Read the state handbook on tenant/landlord rights and talk to someone who can explain anything that you don’t understand.

Have a reserve fund so you don’t panic when a major repair arises AND IT WILL.

There are plenty of other ideas. I suggest mine with over 30 years of experience with many tenants.

PS: Don’t worry about nail holes in walls. 😉

[SK in CV]

Great recommendations, top to bottom.

[Del Sur 14]

When going month to month how do you deal with raising prices?

Do you just send a 60 day notice?

Do you ever work out a month to month lease tied to an agreement to not raise the rent until a set time?

Something like: Month to Month lease for $2500 a month, price is locked for first year and could be re-raised annually starting in June 2015?

[Coronita]

[quote=Del Sur 14]When going month to month how do you deal with raising prices?

Do you just send a 60 day notice?

Do you ever work out a month to month lease tied to an agreement to not raise the rent until a set time?

Something like: Month to Month lease for $2500 a month, price is locked for first year and could be re-raised annually starting in June 2015?[/quote]

Personally, if I agree to lock the rate for 6 months or a year, then they will sign a 6 months or year’s worth of lease…

Month-Month + an agreement to lock the rent for a fixed period is every benefit for the tenant and no benefit for you….They can bolt whenever they feel like it, leaving you to backfill the month(s) that it goes un-rented.

I guess as an alternative, you could always charge $X/month and upon completion of 12 months, rebate back $Y, but personally I haven’t done that yet….

I typically have slightly below market rents, and try to get the best qualified tenant with great credit score…

[Coronita]

My recommendation would be also if you self manage several properties, make sure you have a contingency plan if you go on a vacation longer than a few days…

[an]

Great post HLS. I agree with all of the points.

[plm]

HLS,

Excellent post on how to do things. I’m doing everything wrong. Definitely should have done all that you suggested. But, I don’t think I’m cut out to be a landlord. Too hard to demand rent and charge late fees.

[Author]

Posts