All Forum Posts by: Melissa Melia

Oh! And @Troy Fisher we don't typically advertise ahead of vacancies for two big reasons - 

1) Most of the time, an occupied unit doesn't show as well and we get less for it, with the current tenant's belongings in it (unless it looks like a Crate & Barrel catalogue).  Our investor clients need the strongest rent roll possible because many of them are using it to leverage other projects.  They'd rather take a week or two of vacancy to get an extra $100 - $200 month/rent on paper. 

2) Sometimes there are surprises when tenants move their stuff out, and we don't necessarily want a new tenant moving in the next day.  That closet full of stuff could be concealing a roof or plumbing leak, for instance, and we want to handle that in an empty unit. Some units just need cleaning and paint touch-ups at turnover, some need more, and we want to make sure we're handing a quality unit over to the next tenant. 

@Troy Fisher - if you make exceptions to criteria - how would you do it?  Update screening criteria within the listing (it's now required to be listed or linked there), and re-contact everyone who's inquired to give them equal opportunity to meet the new criteria?  Or just bend he rules or notice of Adverse Action to the applicant and make them pay an additional deposit for the added risk?  I think a much better approach (and sorry for being vague in my first reply) is to have screening criteria that doesn't put you in this position in the first place. If you're willing to accept a lower threshold of tenant, that should be your minimum requirement stated in screening criteria.  

Hi @Troy Fisher! It's been a while, my friend. Oh... my new favorite piece of legislation. We've always used standard screening criteria and processed applications in the order received, but as @Patrick M. says above, it's the wait time forcing the wheels to turn slower that are killing us, and it's equally unfair to renters.  72 hours for additional information (like adding a co-signer/guarantor if we discover someone has no credit - like a college student), and 48 hours for them to accept an approval. This serves that first applicant well, but we have:

• Multiple applicants for each vacancy, who can be left waiting a week or longer to learn if their applications will even be processed
• Applicants applying for multiple properties, and tying up units they may have little intention of inhabiting as backups, now that they have this time buffer
• Landlords with increasing vacancy costs. Dragging the vacancy out means rent income lost, and frankly, units that could be used to house people sitting empty.

 I'm on the receiving end of a lot of frustrated people just wanting a place to live, and small landlords who operate on slim margins and are eyeing record-high sales prices as an out. If you're in Seattle, contact your Seattle City Councilmember responsible for this terrible piece of legislation which somehow manages to work against both renters and landlords.

To answer your specific question, Troy, we have screening criteria that sets the bar high, but is not exclusive based on a credit score number.  For some properties we do accept co-signers or slightly lower credit scores.  We exclude things like "consistent patterns of delinquency," instead of "credit scores below 700." Just a note that in light of this newest legislation, we've also added the screening criteria "applicant must be willing to take possession within 2 weeks of approval" because the SMC is so poorly written that the first applicant could want possession 3 months from now, and what's stopping them.  

Welcome, @Adam Christensen!

Hi @Tim James! Can you tell us a little more about your short and long-term goals for the properties - i.e. immediate cash flow, appreciation, something you can apply the BRRR method to? Different neighborhoods can provide different opportunities...

Welcome @Ian Stuart!  

Hi @Jack B..  Hoping your letter is well-received and things turn around.  

Your note about intending to move back into the property caught my eye...  if your property is in the city of Seattle, make sure you review the recent updates to the Just Cause Eviction Ordinance.  You may need to give 90 days notice instead of 20.  

How pampered are we in Seattle with our a giant pool of quality renters and low rental inventory, that we have to worry about these things.  As landlords, do we risk listing too low and leaving money on the table, and creating a feeding frenzy around our unit? It's kind of like of pricing a sale listing low to generate multiple offers - lots of hopeful applicants shelling out application fees and falling in love with it, only to be disappointed.  Or do we contribute to the price escalation and price it high to attract a more manageable renter pool, where each applicant has a better chance of getting the unit?  This is a topic I weigh constantly and adjust strategy as our market evolves.  For the sake of our industry, it's not enough to just provide rental housing value - providing a fair and quality experience to applicants and residents is equally important.

I use Craigslist and Postlets (which is syndicated to Zillow, Trulia and others), as well as our company website to list vacancies. 95% of current traffic is coming from Craigslist and Zillow. @Allen Clark, I'm curious to know how many contacts you were "slammed" with? At the moment, I like to see 5-10 inquiries/day. If I get 20+, it's priced too low, 1-3 it's pushing the limit on price. I also prefer showing appointments vs. open houses to prevent that stampede atmosphere. But everyone has their own method for listings. :)

If the numbers are right now, and you have a long time horizon, would you kick yourself later if you passed on it?  You know the neighborhood market and are developing a successful equation, it's ok to have a niche too, if you do it well.  If your greatest concern is a potential downturn, you've already performed the wisest hedge - buying properties in high-demand locations.  

...and if/when things go south, you have a few levers besides price to keep your properties performing:

• Providing quality finishes to set you units apart (which you may be doing already, based on your remodel comment).  In the last downturn, the stuff that sat vacant was outdated, not clean, under-maintained.
• Allowing pets is a great way increase the renter pool without lowering price.
• Charge less to move in.  With market rents, coming up with first/last/security deposit can approach $10k in some neighborhoods, which can be a difficult check to write even for professionals. Maybe having high screening standards but a lower security deposit and not collecting last month's rent up front is enough insurance for you.
• Up your marketing game.  Use a photo editing software (I like Snapseed and take pics on my iPhone 6) to show the property in the best light.  Renting is emotional, don't hesitate to put a filter on it! ;)

Good luck! Are you going to the meetup on the 29th? If so, see you there...   

Welcome, @Brian Kelley!