All Forum Posts by: Nicholas Cook

@Alex Mosqueda Great question. I would consider the following:

1. What type of relationship do you want to have with your PM. I would then tailor my questions to see if that provider can meet your expectations. For example, so owners want to be hands off and others want to be more involved. Once you know what you want you are better able to assess fit.

2. I would read online reviews. These days both owners and residents look at reviews when deciding to work with/rent from a PM company. Now it is important to keep in mind that management companies will have negative reviews from time to time because they charged someone a late fee or a resident didn't get their deposit back. For this reason you want to look for a trend. Do a lot of people say they don't call back or that they have poor maintenance?

3. You want to work with someone who is part of a professional association as this is a signal that they are interested in building and following best practices. Some organizations are the Institute of Real Real Estate Management (IREM) or the National Association of Residential Property Managers (NARPM).

4. Personality and communication style are big. You are going to be working with this person for usually a year if not much longer. It is important you feel like you can have a good relationship with them.

5. I would ask how they handle security deposit accounting and what methods they use to ensure they can charge a tenant properly for damages at move-out.

6. I would ask about the leasing process and how many days a week they show property as well as where they advertise?

7. I would ask them to describe their differentiating factors. Why choose them?

I hope this helps!

@Matt Faircloth, as long as this is disclosed in the agreement. We retain late fees when residents pay late not only because of additional work required (which may include verbal abuse from the resident for charging them the fee), but because it rarely has an impact on our client.

If a resident pays late, we require the resident to pay with certified funds. This reduces the time it takes for the funds to clear the Client Trust Account and for this reason, the only usually gets their money as regularly scheduled. 

@Michael Zack I wouldn't test the property unless it will impact your painting plans.  As Lee indicated above, simply provide residents with a lead based paint disclosure and the associated pamphlet from the EPA.

If you have a lot of peeling paint you will want to address that so that chunks of painting are not landing on the ground or easy for someone to ingest e.g. children.

Tough situation. 

Are these maintenance guys employees or contractors? This will also impact how you should proceed. If employees, did you do a background check on them prior to employment? were both the techs in the same room? It is less likely for two people to collaborate to do something wrong than it is for one.

What has your relationship been with the residents? Accusing someone of theft is a fairly serious accusation which could result in the termination of ones employment and/or criminal charges. 

I would inform the resident of this and if they seriously believe that the maintenance tech's stole from them that they need to put it in writing. If they think someone may lose their job they may reconsidering how certain they are about the situation. 

@Debbie J. HUD should be informed if any people residing in the property will contribute financially to the household.

In regards to raising the rent to cover additional wear and tear, my understanding that for fair housing reasons you cannot charge more rent due to household size as this could be seen as discriminatory. You can raise the rent if the market warrants an increase and as long as you follow any required notice periods for increases per your state law.

If HUD allows the additional parties, you may not have an option if they can be added or not unless they fail your screening criteria.

@Leon Lee, I've shared my thoughts below based on what I know. If you need legal advice, consult an attorney.

The purpose of a holding deposit is to give you confidence that you can pull the property from the market because the applicant has made a commitment in writing and financially. The benefit that this also preserves is that a lot of holding agreements (in Oregon we call them execution agreements) have language that protects the landlord in the event they cannot deliver the property as agreed. For example, the property is flooded, damaged in a fire, or for some reason is no longer fully habitable. With a holding agreement you are able to simply refund the deposit and walk away whereas if you had a lease, you would then need to provide housing (basically a hotel) to the tenant until the property became habitable, etc. or find them substitute housing.

Our execution deposits are larger than $300 so we get the best of both worlds.

If you opt to skip the holding agreement and go straight to the lease it can delay the process and result in the resident backing out due to change of heart or they may have challenges coming up with the deposit money (this should be rare as your ad should state the deposit terms). With that said if they do sign and pay you the full deposit you have more collateral. 

It comes down to your risk tolerance.

I hope this helps.

@Lauren M. it depends on what your state laws say. With that said, a few things should be considered.

1. First and foremost check your state laws. Depending on the amount of money you want to charge them for it is advisable to speak to an attorney. While the law may not spell out clearly what to do in these situations, an attorney experienced in landlord-tenant matters will know how a judge may rule given the circumstances should your accounting be challenged.

2. Find out from the seller if they have a condition report or any other documentation. You're agent should have requested this prior to closing and as part of the due diligence. Absent of this I would document everything with pictures.

3. Review your lease agreement with them and see what it says about the deposit and terms of use.

4. Find out how long you have to assess charges after providing them an accounting of their deposit. In Oregon, we have up to 1 year to add additional charges. However, it isn't easy to pursue a resident after the fact.

5. Unless they have records that indicate that they did not cause the damage or leave the trash/debris I would plan on charging them. It is unlikely that a resident would move-in/accept  a property with broken windows and trash, and for this reason I think it is reasonable to assume the trash an damage is from them.

I hope this helps.

@Walter Correia Communication is key in any relationship. You should notify them immediately and follow whatever the rules are for collecting past due rent. In addition to this, you want to be consistent with this process moving forward as it sets the tone for your relationship. If the resident knows you are serious and enforce the agreement they will be more clear about how your relationship will work.

Also, it's not clear if you are charging a daily late fee since you said "currently accruing, but I would recommend a flat fee which is easier to account for. 

Good luck!

@Jason Holden, upgrades to the kitchen and bathroom as you suggested are generally worthwhile, but what you upgrade things to depends on how long they plan to keep the property and where you believe the neighborhood is trending based on your time horizon for ownership.

If they plan to keep the property long term, better quality upgrades make sense if the market can bare the premium being charged.

I also agree with @Ryan Scott Isacksen, that nicer properties that are clean and have strong cosmetic appeal will attract better quality residents which has a significant impact on the bottom line over time.

@Jessica V. the easiest option would be to have them mail you a check. If you want more security you can require certified funds and if you can justify using the cost of an online payment portal that works too. 

One rule we do have is that we do not accept cash. This is for a variety of reasons such as creating a paper trail and for safety reasons.