Rental vacant 6 months! Need new PM ASAP!

[Christine Goodwin]

Hello fellow Tulsa investors!

I am a long distance investor (Florida) with a duplex in Midtown near Bishop Kelly HS. My PM has been less than ideal, first not telling me for 4 weeks that my tenant bailed one month after renewing a 12 month lease, then charging me $2400 to turn over a one half duplex 2/1 that rents for $1100/month. (And yes, I questioned the costs)

They finally got the property listed in November. They provide me a weekly report on activity. This week, the tally is 700+ views, 38 showings in 4 months. Had 3 applications, one incomplete and 2 were "terrible" and high risk. 

So why is it not renting, one asks? It's location, price, or quality. Location is ideal and in a quiet residential neighborhood. Price, we adjusted the rent down 2X already. Quality, I have been asking for feedback from viewings and they tell me that they provide "remote showings", in other words, they get an ID, provide a lockbox code, and the prospect views on their own. No one collects any feedback. So I cannot act on what I do not know. 

In the meantime, I personally have found 2 back to back tenants for the other 1/2 by putting a sign in the yard and having a local agent friend show it. From Florida. That half is rented furnished and I include utilities. 

Of course I am forced to fire this company once I find another solution. 

My options:

- Keep LTR and hire another local PM company, 

- Keep LTR and self-manage long distance,

- Provide to Section 8 but have older metal 1970's windows (but new front door and new central AC) so not sure it will pass inspection, and prefer not to wait the 45-60 days for it to be cleared, 

- Furnish and convert to MTR. As for marketing it, Furnished Finders has not been as helpful as I had hoped. 

Anyone have feedback, recommendations? TIA!!

PS - I also have a large detached garage on the property that has been sitting vacant. Access requires going through the yard, and is disruptive to tenants. Would need to put in a fence to divide the access.

[John Kunick]

@Christine Goodwin, quality properties go quickly here in Tulsa.  I listed one of mine this week and had 40+ inquiries within a couple of hours and had it re-rented within 24 hours.  Something certainly doesn't seem kosher based on what you reported..  Feel free to PM me with the addresses and I will do a little research and perhaps give you "on the ground" feedback.
I would like to understand the situation with the garage..  Does the garage go with one or both of the properties?  Should the garage be removed?

[Tom O'Stasik]

Curious about the address. If you need some PM recommendations, let me know

[Richard F.]

Quote from @Christine Goodwin:

My PM has been less than ideal, first not telling me for 4 weeks that my tenant bailed one month after renewing a 12 month lease, then charging me $2400 to turn over a one half duplex 2/1 that rents for $1100/month. (And yes, I questioned the costs)

Did they let the tenant go with no reason? Was rent pro-rated to their last day of occupancy? Is the tenant being held responsible for the remaining term, while the PM makes good faith effort to re-rent? Or what was the deal? What were the expenses for...repairing tenant damage that should have been taken from SD? Or general "freshening up"? 

They finally got the property listed in November. They provide me a weekly report on activity. This week, the tally is 700+ views, 38 showings in 4 months. Had 3 applications, one incomplete and 2 were "terrible" and high risk.

Every market, every property is different, but rentals are notoriously slow Nov, Dec, Jan, and usually into mid-March. If the three applications did not meet standards, would you have them lower the screening standards?

So why is it not renting, one asks? It's location, price, or quality. Location is ideal and in a quiet residential neighborhood. Are you sure about that? What is it like at night? Does one of the neighbors have a noisy/obnoxious dog that you were not aware of?

Price, we adjusted the rent down 2X already. "Down" from what? Your asking price, or the PM's recommended starting point?

Quality, I have been asking for feedback from viewings and they tell me that they provide "remote showings", in other words, they get an ID, provide a lockbox code, and the prospect views on their own. No one collects any feedback. So I cannot act on what I do not know. You should have plenty of photos from the PM and/or your own visits to the property. Have you requested a current,thorough, photo set? What photos are they using for marketing? How does yours compare visually, in style and finishes (notwithstanding personal taste) to others marketed in the broader market? ARE you competitive based on actual condition?

In the meantime, I personally have found 2 back to back tenants for the other 1/2 by putting a sign in the yard and having a local agent friend show it. From Florida. That half is rented furnished and I include utilities.  Cool. How does YOUR screening process stack up against the PM's?

PS - I also have a large detached garage on the property that has been sitting vacant. Access requires going through the yard, and is disruptive to tenants. Would need to put in a fence to divide the access.

So, is this a rural property, or a very large lot? Is it rented with one or both sides of the duplex, or completely separate? What is the condition and appearance of the garage...is it poor to marginal compared to the exterior of the duplex, or comparable? What do you hope to achieve with a fence? Are just leaving an abandoned garage on the property?

Lots more to learn here for a useful judgment either way...

[John Kunick]

@Christine Goodwin, quality properties go quickly here in Tulsa.  I listed one of mine this week and had 40+ inquiries within a couple of hours and had it re-rented within 24 hours.  Something certainly doesn't seem kosher based on what you reported..  Feel free to PM me with the addresses and I will do a little research and perhaps give you "on the ground" feedback.
I would like to understand the situation with the garage..  Does the garage go with one or both of the properties?  Should the garage be removed?

[Brendan Harrison]

I have a few PM Recommendations. Would love to send you their contact information - message me if interested. 

[Theresa Harris]

If you were able to get the other side rented with the help of a friend, I'd hire that friend to do the showings and fire the PM.  Mistakes happen, but not telling you it was vacant until 4 weeks after a lease we renewed, and the high turnover cost (was any of that stuff that should be charged to the former tenant) and remote showings-something is up.  I don't like remote showings for a number of reasons. I understood it during covid, but even then; what are you paying the PM to do when they find a new tenant?

Now is as good of a time as any to get a new PM or try to self- manage.

[Mitch Messer]

@Christine Goodwin As you observe, the three main reasons a property doesn't rent are indeed "location, price, or quality."

I suspect your unit isn't moving because even at $1,050 the rent is set too high for an unfurnished 2/1 in that part of Tulsa.

You would be totally justified in blaming the PM for not knowing their market. But, that's not the WORST of it!

Their pricing adjustment methodology is shockingly horrible!

They initially offered it at $1,195 on 11/3, dropped to $1,150 just TWO days later, then waited a whole MONTH before dropping it to $1,095, then ANOTHER month wait before arriving at $1,050 in mid-January!

Basically, they cost you THREE months of rent (>$3K) trying to squeeze an extra $150/mo out of the market.

That's crazy, because the market always wins...

My recommendation is to furnish it and convert to MTR.  

[Christine Goodwin]

I respect that you did your homework on this one.

In Fall 2021 it rented for $1095, so it was priced with a reasonable market increase. The PM had no methodology, they let me drive the price adjustments after it was not rented. They also seemed to price similar units (1/2 duplexes) in step with mine. And the worst of THAT is that I came to THEM with market information on available units and trending rents. They didn't offer anything. 

Appreciate the input, now to find a solution that isn't costing me $$$.