Monthly Archives: December 2013

lease agreement

Rushing Into Signing a Lease Agreement

lease agreementSo your Chico rental property is empty, and that’s not a good thing. But do not panic and think a tenant has to be in tomorrow, and be pressurized by your tenant, the most common mistake we see by novice owners is acting too hastily in trying to get the tenant into the property, not carry out all the sufficient detailed reference checks and worrying about voids. These are the most common factors in getting a bad tenant. You want to protect your investment, before giving that tenancy agreement, the tenant must go through due diligence.

I’m still amazed that you still have amateur landlords worrying about paying the mortgage next month and getting in the first tenant possible and some are not even obtaining a reference, not doing a background check and are accepting 2/3 months rent in advance and not worrying about month 4 of the tenancy – will the rent be paid? The real secret to good property management is attracting good tenants and making sure they are good before move in day.

You can never predict what will happen during a tenancy, your tenant may lose their job, a couple may split up, your tenant could be imprisoned, or the biggest factor out of all, they could just be in debt. But your job (or ours if you are a customers!) is to determine if they’ll be paying the rent. It’s like betting but with a lot more at stake. We prefer to stack the deck against you as a landlord.

Here are a few tenant screening tips from the pros (that’s us by the way!).

property management checklist

Property Management Gems: Tenant Screening Tips

property management checklistThe 80/20 rule of the landlord-tenant relationship dictates that 20% of your tenants will be responsible for 80% of your grievances and headache. Since a few bad apples will end up consuming the majority of your time/energy, and in turn stunt your efforts to grow your business, a proper tenant screening should be at the top of your mind when it comes to filling your vacancies.

As a landlord or Chico property manager try to be as comprehensive and efficient as possible in the tenant screening process.

Qualify the Applicants
Your tenant screening process actually begins before you even meet the applicant. Any time you are asked to do an individual showing of the property, avoid making work for yourself later by pre-qualifying the interested party to make sure he/she has a chance of being a good fit.

Essentially you want to ask the questions that will make or break an applicant’s chances with your property.

If an applicant has one of the “deal-breaker” qualities (e.g., owning a pet when the owner has specified that no pets are allowed), you’ve saved yourself the time of showing the property to someone who couldn’t rent anyway.

Show the Property and Give out Application Forms/Instructions
Once you’ve pre-screened the interested parties, you should show the property. Aside from letting these prospective renters see the unit, the showing gives you the perfect opportunity to interact with them in person. You’ll be working with your new tenant a lot in the coming months, so it’s worthwhile to meet all the candidates face-to-face and determine who you’d most enjoy working with. Some property managers even check IDs to make sure they are meeting the person who will be renting the property, not just a friend representing the applicant.

Make sure to offer the application to anyone who is interested so that everyone has a fair chance to apply. Not only can you violate fair housing laws if you pick and choose who receives the application, it’s also a violation if you give out different application forms to different individuals, so make sure you ask every applicant identical questions. Charge a fee for your time and to cover the cost of the credit check ($30 – $50 is reasonable).

Check Their Rental History
When it comes to reference checks, your main objective is to confirm the applicant’s rental history and employment information according to his/her application form. Rental history is arguably the more critical of the two since it gives you an idea of the applicant’s credibility, specifically as a tenant.

Aside from contacting the applicant’s current landlord or property manager, you should also contact his/her previous landlord or property manager. This is because an old landlord has no reason to lie to you about the tenant’s past behavior, whereas a current landlord who is trying to get rid of this bad tenant may be incentivized to cover up the tenant’s poor behavior in hopes of “unloading” this tenant to the next property that would take him/her.

Check Their Employment Information
Not every property manager performs an employment reference check, but it may be worthwhile if you’re uncertain an applicant can afford the rent. When it comes to confirming an applicant’s employment history, the process tends to be trickier because companies are limited on the employee information they can disclose. Unlike the types of questions you ask current and past landlords, your questions for the applicant’s employer should have Yes/No answers to make it easy for them to answer.

Run a Credit Report
A credit report reveals an applicant’s financial and legal status for the past seven to ten years. You should order one for all the applicants you are seriously considering since it is the one piece of evidence that cannot be faked.

You should have obtained every applicant’s name, address, and social security number in their application forms, which you need to obtain a credit report. Depending on the type of report you order, you may also get a FICO score that reflects an applicant’s credit. The score ranges from 300 to 850, and typically an applicant with a score above 650 is considered medium-to-low risk.

Make Your Decision
After you’ve scored all the applicants, it’s time to make your decision. For the tenant you’ve selected, review all the rules together so that he/she has a clear understanding of your expectations. Make sure he/she understands his/her responsibilities to receive the full security deposit back at the end of the lease, since security deposit disputes are among the most common in court. This is a particularly good time to clarify how and when you will perform your move-in/move-out and/or periodic inspections to record any damages incurred during the tenant’s stay.

For the applicants you do not select, if the cause of their rejection is negative information on a credit report or because another applicant has a higher credit score, you must provide him/her with the name and address of the agency where you obtained the report. You must also tell the person that he/she has the right to request a copy of that report within 60 days of receiving rejection from you. This is a requirement of the federal Fair Credit Reporting Act.

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The Easy Way to Keep Good Tenants

????????????????????????Retaining good tenants in your Chico property can be more challenging than finding reliable tenants in the first place. Continuing with the same people in your properties is hugely beneficial for you as either a landlord or a property manager, as it prevents void periods where the property is empty and receiving no rental income. It also reduces the amount of time and paperwork dedicated to each property, due to the fact that the current tenants do not need to be continuously regulated and checked in the same way new tenants require.

Here are some pointers to help keep your tenants happy and encourage them to stay in your property:

Go the Extra Mile
Don’t underestimate how much a little extra effort on your part will be appreciated by your tenants. Always keep in mind there is influx of rental property due to poor selling conditions and homeowners becoming DIY landlords.

Be Responsive
Communication is vital in the tenant/landlord relationship, especially if you are wishing to keep them as renters. Don’t ignore their requests simply because you don’t agree. Talk through the issue and explain why you’re not happy with their suggestion and try to reach a compromise between both parties. Never ignore calls, texts, or emails from tenants. Make sure to answer or return calls immediately, as delaying the conversation is more likely to cause issues to increase in severity. Tenants do not like to be ignored, and this practice will make them disregard the property and you as an authority figure.

Address Problems Quickly
If your tenant complains of a loose drawer or squeaky door, try to fix them as quickly as possible. It may seem a minor issue in the grand scheme of property management, but these problems cause irritation and annoyance to tenants on a daily basis. Do not wait for tenants to call several times before you address these problems. Make sure to have a contingency plan if you are busy, rather than leaving a backlog of issues to resolve when you finally have time. Be sure to call a contractor promptly if you feel you cannot fix it properly yourself. If the problem needs time or extra parts you need to order, explain the process to the tenants so they have a better understanding of progress being made.

Find Ways to Help Out
Aside from addressing “fix-it” calls, you will need to find additional ways to help and please your tenants to ensure they stay at your property. They are doing you the favor of choosing to rent from you over other companies, so treat them as your customers. Housewarming gifts such as welcome baskets delivered on moving day can be an inexpensive idea but extremely thoughtful, and they are sure to be appreciated by a stressed-out tenant. Sending a small note or card at Christmas to thank them for looking after the property is friendly and respectful.

Invest in the Fixtures and Fittings
Quality materials and appliances make everyday life easier, as well as giving the property a more luxurious feel. Renters are more inclined to pay slightly higher rental fees if they can see it is a high standard of property that is well maintained. They also tend to stay longer in a place they can be proud to show and entertain family and friends in.

Rent to Pet Owners
The thought of tenants having pets is enough to make many landlords think twice about accepting a tenant. However, it has been proven that properties accepting pet owners are in much more demand, and tenants are less likely to move once they and their pets are settled. Ensure that there are rules in the contract that the tenants must repair or replace any damaged areas, clean up after their pet, and adhere to respectful practices concerning communal areas and interactions with neighbors.

Keep in Touch
Do not become overly involved in your tenants’ lives because they can see this as interfering, and it may cause boundary issues later on in the tenancy. However you should always remain approachable and friendly. Regular communication will give your tenants a heads up to any issues or future work that is planned.

Respect Their Privacy
Even if you own the property, do not just barge in whenever you feel like it. Not only is this illegal to do without giving proper notice, but it is also extremely rude and disrespectful to your tenants. Unless it is an emergency, make sure to call in advance and schedule a visit.

Screen Potential Tenants
Screening potential tenants will not only help you rent to trustworthy people in the first place, but it will help maintain your current renters. In shared properties and apartment blocks in particular, a bad tenant can affect the rest of the renters and discourage them from staying long-term.

spring cleaning

Easy Turn Over Touches

spring cleaningUpdating the look of your Chico rental property will not only create a blank canvas that appeals to a wider range of tenants but it will also give you an opportunity to command a higher rent by showing that you take care of your tenants. Some things to consider upgrading:

Minor / Low cost upgrades:

  • Paint rooms, hallways and inside closets with a neutral colour such as beige, cream or light grey to freshen up the space
  • Consider replacing door hardware such as knobs, handles and pulls to create a more modern look
  • Update or add light fixtures
  • Replace locking turn knobs with non-locking passage knobs (to save on rekeying and prevent tenant lock outs). A bolt lock provides all the security needed, so the turn knob is redundant.

Medium cost upgrades:

  • Replace carpeting with hardwood or laminate flooring
  • Upgrade or replace baseboard heaters with new or convection-style models
  • Swap the shower head and fixtures in the tub/shower, bathroom sink faucet as well as kitchen sink faucet
  • Replace or refinish cabinet doors to give a modern look
  • Replace or upgrade fridge, stove/oven to stainless steel models
  • Install radiant flooring in the bathrooms

Now that you’ve gotten your property ready to rent, it’s time to create your listing and start marketing to prospective tenants. Happy renting!

turn over repair

Turn Over Property Repairs

turn over repairTurn over time is the best time to fix any little things like that loose door knob you’ve been ignoring or the hole in the screen, as well as large repairs like replacing a hot-water heater. It’s so much easier to do it when vacant than when it’s full. Take the extra time and do it right. Once your tenant has moved in, repair and maintenance issues can quickly worsen becoming costly and dangerous putting both your tenant and your property at risk:

  • Replace burnt out light bulbs and install security lighting if needed
  • Ensure railings on stairs and balconies are properly bolted and secured
  • Check all knobs, handles and door hinges and tighten or replace as needed
  • Hire a professional to clean your chimney and dryer vents. Not only does this help with energy consumption costs but it also lowers the chance of having a fire
  • Check electrical outlets, switch and plate covers changing any that are cracked or not working
  • Verify the fuse box is labelled properly and replace any blown fuses
  • Replace batteries in all smoke detectors. Remember to check the age of your detectors as all smoke detectors must be replaced after 10 years from date of manufacture
  • Ensure you have a charged and functioning fire extinguisher
  • Check that drains in the bathrooms, kitchen and any utility areas or basement are draining properly and remove any soap build-up, hair, food or other debris that may be blocking draining or could cause a backup to occur
  • Double-check seals around tub/shower enclosures and reseal as needed to prevent leaks
  • Examine seals around windows and doors and replace as needed checking for condensation and mould
  • Fill any holes and cracks in walls
  • Mend any pulls in carpeting or flooring
  • Repair or replace any damaged screens, windows or doors

Cleaning Tips for your Chico Rental Property

property cleaningNobody wants to live in someone else’s filth and germs. A clean property will be more appealing to prospective tenants and helps set the expectations that you care about your property:

Flooring

  • Vacuum and steam clean carpets and rugs
  • Mop and polish hardwood, laminate and tile floors
  • Clean the inside of closets which can trap lint, dust and dirt
  • PRO TIP: Use a bounce sheet to clean dust and gunk off of baseboards

Bathroom

  • Scrub toilet, tub/shower, sink and vanity to ensure there is no soap scum or stains
  • Wipe the inside of cupboards and drawers to remove any dust, dirt or hair that may have gotten trapped
  • Wipe away dust from the ceiling fan
  • Remember to polish the mirrors too!

Kitchen

  • Sweep behind the stove/oven and fridge
  • Wipe any dust and oil buildup from the hood-fan and the wall behind the stove
  • Check inside the oven for burnt food and clean it out completely. Remove any spills from the oven door and seal
  • For ceramic cooktops, use a thin scraper to remove any caked on food or stains and give it a good polish
  • For gas or electric ranges, remove the elements and clean out any food or baked on debris before replacing the elements
  • Completely wipe down the fridge inside and out. Don’t forget to check the inside of any crisper drawers and the freezer
  • Defrost the freezer
  • Wipe the door seals and remove any dust from the cooling element/vents

Lights/Fans/Heating

  • Wipe and dust corners of ceilings, lamps, spotlights and chandeliers to rid them of any spiderwebs
  • Wipe ceiling fan blades and lights with a damp cloth to remove dust
  • For forced-air heating, check that vents are clear and free of debris and dust
  • For baseboard heating, wipe any dust off the element and tops of the heaters

8 safety tips: Avoid these common holiday mistakes!

christmas_lights-01Safety is the best gift to give your family this time of year. Keep their holiday season safe, merry and bright with these simple tips.

  1. Look into the lights. It pays to spend at least as much time looking at your holiday lights as you do looking for them. Once you pull your holiday lights out of the attic or that dusty storage closet, give each string a careful inspection. Look for frayed wire, broken sockets and signs of significant wear. When in doubt, toss them out. Also, check for the UL symbol from Underwriter’s Laboratory or a similar tag showing the product has passed the safety tests of a national lab. Finally, before you hang a string of lights, plug it in to make sure everything is working properly.
  2. Three’s company, four’s a hazard. Stringing strands of lights together is a lot like golf–a lower number is better. Connecting too many strands can overload circuits, so play it safe and follow the rule of three: connect no more than three strings in a row. Also, avoid tucking cords under rugs (which creates a fire hazard), and keep them away from walkways where they can trip someone or be stepped on and damaged.
  3. Right lights, right place. It’s natural to want to showcase your holiday style with a brilliant outdoor display. Just be sure to use lights and power strips that are approved for exterior use. And remember, outdoor equipment is sturdy, but not invulnerable. Use common sense and keep connectors off the ground, out of gutters and away from downspouts.
  4. Turn off the show before you go. When you pull out of the driveway at night, it’s tempting to leave your house glowing in full glory, like a beacon to guide you home. But if safety and savings are top priority, turn off holiday lights whenever you hit the road. Want the best of both worlds? Set up a timer to turn lights on and off automatically. That way, you can enjoy the spectacle when coming and going, and never worry about forgetting to shut down the show after hours.
  5. Prevent forest fires. When you bring an evergreen indoors, the same precautions apply to your forest of one. Campers know that dry pine needles are great for starting fires, so keep live trees far from candles, heaters, stoves and fireplaces. And make an effort to keep the greenery green. Water your tree as diligently as you would a pet–up to a gallon of water per day will help keep your tree safe and fresh. After the holidays, or if your tree becomes dry, don’t wait to take it down and take it outside.
  6. Don’t skimp on safety. Artificial trees are gaining in popularity, but don’t sacrifice safety in the name of style or savings. Before you decide which tree to bring home, make sure it’s been tested and labeled as fire–resistant. If the tree comes with lights, look for a sticker showing it’s been safety-tested by Underwriters Laboratories or a similar national lab.
  7. Keep cool with LEDs. There’s nothing wrong with blending time–tested tradition with cutting–edge technology. When shopping for indoor or outdoor holiday lights, consider light–emitting diodes (LEDs). These high–tech, high–efficiency bulbs are shatterproof, shock–resistant, and cool to the touch, which greatly reduces the risk of fire. Even better, they can reduce energy consumption by up to 90 percent. They also last up to 25 times longer, which means they can be part of your holiday celebration for years to come.
  8. Look up and live! Before stringing lights on outdoor trees, make sure tree limbs haven’t grown into or near power lines. Branches, entire trees and even the ground adjacent to a tree can become energized when trees contact power lines. Never place yourself or any object — like a ladder — in a position where you or it may come in contact with a power line — the result can be fatal. Keep at least 10 feet away from overhead lines.