All Forum Posts by: Anthony R.

So, like many of you, I recently heard about and read some of the Heroes Act legislation.

It's fantastic that the government is attempting to help everyone, but, honestly, am I the only one that's worried about this?

If rent goes to zero for 12 months, I would still be responsible for

-Water bills in buildings that aren't separately metered

-All repairs; roof, furnace, water heaters, appliances

-Landscaping and other services

-Fuel to and from properties

-Equipment maintenance

-Taxes and insurance for properties that aren't mortgaged

-Any legal fees

-Property management software fees

Am I looking at this wrong?

Per the Colorado Tenant Landlord Laws

Month-to-Month Lease
A month-to-month lease is a rental agreement for a one month period that is renewed automatically each month until properly terminated by either party. When a landlord and a tenant have not executed a written lease and rental payments are made monthly, a month-to-month lease is implied by law. A month-to-month tenancy is usually created when a tenant moves into a property and pays rent without signing a lease. It may also be created when an expired written lease is not renewed but the tenant remains in the property as a “holdover,” with the landlord’s consent. In such a case, if the written lease contains a clause stating that all lease provisions continue to apply after the written lease expires and the tenant stays on with a month-to-month lease, then the rights and responsibilities of each party, as defined by the expired written lease, remain in effect. 

With any month-to-month lease, the landlord can raise the rent, change or terminate the agreement at the end of each month, with proper written notice to the tenant. The tenant, likewise, can terminate the lease at the end of the month with proper written notice to the landlord. Proper notice for both landlord and tenant must be written and received by the other party at least ten days before the last day of the rental month. (See C.R.S. § 13-40-107). However, a written month-to-month lease may specify a longer notice period, for example, 30 days or 60 days before the end of the lease term.


I would just follow that 

Recently my landscaper went under due to the loss of business from the virus. This has led me to just buying all the equipment to do all the landscaping myself. Now obviously, I can write off the equipment but not my efforts.

In short, if I form a new landscaping company, can I sell my services to my rental company and is it worth it? Is there tax savings anywhere in there?

We have 14 units - I sent an email 3 weeks prior to April 1st asking if anyone was affected by COVID19 and I also linked everyone the unemployment information put out by the State of Ohio.

One week out from April 1st I reached out to everyone personally and asked if they were affected and if they thought they'd make rent on the 1st. Our plan was to collect from who we could and carry the rest for as long as we can. 

Two tenants were actually affected - one could still make the rent because their spouse covered it, the other had savings and applied for unemployment 

In total, we had 1 tenant not pay rent, they openly admitted it wasn't from COVID19 to me on the phone and they've been habitually late for the last 8 months.

3 day eviction notice being delivered tomorrow and a cash for keys deal is on the table. We'll see

I would check the laws in your area before splitting out water bills. In my area we're not legally allowed to split a bill if it's not sub-metered.

We do have section 8 tenants and though I will say the government portion of it is a pain in the ***, the tenants have generally been the same as other tenants. Strong leadership and clear expectations make a good rental business. Blaming tenants is never the right answer.

I empathize with our tenants. Our business model has always been and always will be, take care of our tenants first, and the bottom line will follow. That said, it IS A BUSINESS. The needs of an individual tenant do not outweigh the needs of the business as a whole to survive.

If I can help a tenant here or there with a late fee, fixing something that's not really in my scope or going the extra mile to make someone happy, then I tend to. I would never sacrifice the integrity of the business though by not keeping the rent up with the market value. Our rents usually fall just a little (maybe 5-10%) under market value so that we ensure we're always rented and that the tenants know they're getting a great deal and want to stay. 

That said, we always keep raising them if we need to.

My recommendation to you would be to either let the tenants know that when their lease expires, you're raising the rent to close to market value and let them decide if they want to stay or not, or sell.

I'd be lying if I said I haven't waived a late fee from time to time. That said, I give everyone one freebie. After that's burnt, they get a 3 day eviction notice. You can't show weakness or tenants will take advantage.

--DO NOT TAKE PARTIAL RENT--

That's probably the best advice anyone will give you on here. I know where I'm at, if you accept even a penny, then you can't evict that month. I require my tenants pay online and I make that online system require they pay in full. I don't accept anything in person, ever. This prevents me from hearing last minute sob stories, it looks more professional and it helps in preventing me from getting screwed by professional tenants.  

It's your financial freedom or their ability to live for free off your back. Take your pick 

We end up growing our rent and owing each year. We do pay quarterly which helps offset how much we owe down to a very reasonable amount, but I haven't gotten a return or broke even in years haha. 

Once again, thanks for the advice

@Natalie Kolodij I appreciate your input as well as everyone else's. It helps clarify this to me so thank you. 

The reason I say rental income is pretax is because, earned income from a job is taxed before I ever see it.

Rent on the other hand, goes directly from the tenant, to me, and is taxed at the end of the year, or in more recent years, at the end of the quarter for me. So I have the ability to use the dollars that would normally be taken for tax before I get it, on other things. In this case, on paying down my HELOC.

In a perfect world I would take in rent and set aside the dollars necessary for taxes immediately. Mathematically though, it makes more sense to put as much as I can toward the HELOC to reduce my interest as quickly as possible and then eat the tax bill when it comes.