You know, I have often told people that a monkey could be trained to do property management … and that I am the proof! There are some finer points to the craft that only those with years of experience can implement, but there are also some BASIC PRINCIPLES that anyone can use to better manage rental properties. If you promise to tell a friend about the nice folks at Red Roof Rentals, LLC then I will reveal some of the “BASIC” secrets to you … and here they are:
- A GOOD WRITTEN RENTAL AGREEMENT – Buy, borrow, steal or create one that is understandable, covers your primary concerns, is legally enforceable, firm and fair. Make sure that YOU read it and that YOU understand it. When things get tough it is always nice to be able to fall back upon a good quality written contract to solve problems and give guidance. Stick to your WRITTEN RENTAL CONTRACT … what’s the point of having it if you don’t follow it?
- EQUALITY FOR ALL – Treat everyone the same. Use your head, not your heart, in decision making. That poor old lady who just moved up here from Alabama that seems so sweet but only has $100 for a security deposit … you feel like helping her, don’t you?! Well just remember that you are not a social service agency or assistance program. Stick with your basic requirements and TREAT EVERYONE THE SAME … even poor old granny!
- SECURITY DEPOSITS – What renter wouldn’t like to pay little or no deposit on your rental property? But don’t agree to it! “But,” you say, “their references checked out so well that I don’t think I need a big deposit from them.” Don’t do that! The fact is that many people who START OUT as “gold plated” shining stars of responsibility and trustworthiness end up with unforeseen problems … drugs, failed relationships, death in the family, job loss … so make no exceptions to requiring a security deposit of at least one month’s rent, OR MORE. Your rental contract has a blank for the DEPOSIT AMOUNT … fill it in!
- TAKING PAYMENTS ON THE DEPOSIT – NO. You can evict for non-payment of rent but not for nonpayment of deposit. I don’t care how sad their “story” is … require full payment of the deposit before you give them the keys!
- PET – The primary reason for a landlord to allow a pet is to snag the good potential renter that may be attached to that pet! Properties usually derive NO BENEFIT from the presence of pets and in fact pets always “leave their mark” on a property in some way (I think you know what I am talking about). But we all know of high quality responsible folks whose pet is like their child, and they treat it as such … to reject them as a potential renter because they have a 4 pound Chihuahua would be unwise. Just be sure that your rental contract spells out what you expect if there is a pet on the property AND always increase the security deposit amount if there is a pet present. We recommend NOT ACCEPTING pets under 1 year of age, un-neutered/spayed animals or those that have ever bitten anyone. Service animals are treated differently.
- PET DEPOSIT – Don’t have a separate “pet deposit” … rather keep all deposit money in the same pot for greater flexibility when it comes to paying for damages when they move out. Also, we think it is best to make pet deposits REFUNDABLE … gives the tenant incentive to keep an eye on FIDO if they know that they can get ALL their pet deposit back if they do so! We charge a minimum of $300 per pet (refundable) based on weight. Service animals are treated differently.
- RENTING SITE UNSEEN – Don’t do it UNLESS the prospective tenant has had a LOCAL friend or family member check out the property for them and GIVEN THEIR APPROVAL OF THAT INSPECTION.
- ALLOWING TENANT TO PAY RENT DIRECTLY TO YOUR BANK ACCOUNT – If you do this then I have some property on the bottom of Ohop Lake that I want to sell you! If things go wrong and you have to start an eviction against a tenant, even a small deposit ($1) into your bank account could stop the eviction, causing you to start the process all over again.
- PERSONAL CHECKS – Never accept personal checks from a tenant until AFTER they have paid all deposits and first month’s rent with CASHIERS CHECKS or MONEY ORDERS and moved in. Do not give them the keys until everything they owe you has been paid with “good money” from them. Once they have moved in THEN you can accept personal checks if you wish, but even then we don’t recommend it. We recommend you do not accept cash either … it is hard to track and record.
- CREDIT REPORTS vs. PERSONAL REFERENCES – Credit reports were originally designed to help banks, mortgage companies and car dealers, NOT LANDLORDS. There are lots of GOOD PEOPLE out there that have BAD CREDIT for some very GOOD REASONS. You must search beyond a simple credit score. You must GO DEEPER and check out PERSONAL REFERENCES FROM UNRELATED PARTIES … call their landlords from the past 2 years (ask them if they are related to the applicant!) and check with employers to verify adequate income. Check the name of the owner of record (County records search) to see if it matches the Landlord name they gave you. Drive by where they “say” they live to make sure it is not a vacant house. Pretend you are a detective, because guess what … YOU ARE!
Well there you go … 10 secret pointers from the Red Roof Rentals safety deposit box! Whether you use the professional management services of Red Roof or not, we sincerely hope that we have helped you today … and remember, if you follow just a few guidelines and pointers like these, YOU TOO CAN “MONKEY AROUND” WITH PROPERTY MANAGEMENT!