Tag Archives: rental property

Holding an Open House Saves Time & Money!

In my dreams I fill my vacant units with the best tenants on earth who pay their rent on time, keep the apartment clean, and never move out.  But unfortunately my dreams aren’t reality.

When I’m looking to fill a vacancy I prefer to show the unit like I would an open house.  I’ll pick a day, say Saturday, and set aside a period of time for propsective tenants to view the unit.  For example:  Open House, Saturday, 2-4pm!

I’ll tell as many prospective tenants to come on that same day and time too.  This helps create a sense of urgency and competition amongst the fellow renters visiting the property.  Plus it saves me time from having to meet prospective renters at different times and different days.

By creating a buzz, prospective renters feel the unit is special, limited, and could be rented in a blink of an eye.  This is their chance to grab it before anyone else does.  You never want to eat at an empty restaurant, do you?  Well you don’t want to live at an apartment that no one else is interested in either.

The prospective tenants that are interested will fill out an application right there and then.  Depending on which property I am at, I can also run their credit report on the spot (I check eviction, criminal and some other stuff too).  For screening providers I’ve used and others, click here.

10 Steps Toward Low-Risk Landlording

Learn how to protect your rental property from common mishaps and risky situations.

Most rental property owners worry about protecting their investment. From physical damage to the property to insurance claims to lawsuits brought by tenants, there are myriad ways that you can lose money. Fortunately, minimizing risks in a rental business doesn’t require a ton of money or a staff of experts. All you need to do is learn where you’re vulnerable and then take commonsense steps to minimize that vulnerability.

Here are ten steps you can take to protect yourself against liability as a landlord. By acting now, you’ll enjoy a big payoff: reduced likelihood of lawsuits, harm to tenants and guests, damage to your property, and financial distress to your business.

Step #1: Get the Right Insurance for Your Property and Business

Don’t wait until a loss occurs before you determine whether you have the right insurance for your business and property. Review your current policy with your agent or broker, then discuss coverage options that fit your needs.

Step #2: Make Your Property Physically Sound

Keep your property safe so that people don’t get hurt. To do this, learn the basic legal requirements for repairing and maintaining your property, and then follow them.

Implied warranty of habitability. Virtually every landlord must comply with a legal rule known as the “implied warranty of habitability.” This means you must make sure your rentals are in a “fit” and “habitable” condition when tenants move in, and you must maintain this condition throughout the tenancy. Get familiar with your state and local health, building, and safety codes, and strive to keep your property compliant.

Take steps to prevent injuries and losses. In addition, take other reasonable steps to prevent injuries and other losses. For example, take all tenants’ repair requests seriously and fix problems promptly. Inspect your property yourself for hazards. If you can’t address a hazardous situation immediately, warn tenants and visitors about the danger. (For example, put traffic cones around a pothole, or post signs and safety tape near a spill on the floor.)

Step #3: Make Your Rental Property Accessible to Disabled Tenants

Make your property accessible to tenants with mobility impairments and other disabilities. Check whether structures on your property must follow the Fair Housing Act’s “design and construction” requirements. (Generally, multifamily buildings that were designed and constructed for first occupancy after March 13, 1991 must comply.)

Regardless of when your buildings were constructed, seriously consider all requests from a disabled prospect or tenant to modify your building in order to meet that person’s needs. Review each request on a case-by-case basis and grant it if it’s reasonable. For example, a prospect’s request to install grab bars in the bathroom or lower kitchen cabinets is probably a reasonable modification request.

Step #4: Remove Environmental Hazards from Your Property

Removing environmental hazards is often trickier than removing other physical hazards. Environmental hazards often can’t be seen, and they may not become apparent until they cause injury or property damage. For example, a landlord might not learn of lead paint dust on her property until a family gets their child’s blood test results showing elevated levels of lead. What’s more, in some cases environmental hazards remain invisible even once they’ve caused damage, as in the case of carbon monoxide or radon.

Do your best to address environmental hazards before they cause serious damage. Here are some ways to do so:

  • Require tenants to report all leaks and flooding to you promptly so that you can take quick action to prevent mold.
  • Maintain your heating systems and appliances, and install carbon monoxide detectors in order to prevent carbon monoxide build-up.
  • Comply with federal testing requirements when employees or contractors work on asbestos-containing building materials, such as sprayed-on ceilings. These tests will reveal to workers what’s in your building, and you can use this knowledge to protect your tenants, too.

Step #5: Prepare for and Handle Disasters and Emergencies

Take steps to safeguard your business and protect your property, tenants, and employees in an emergency. For example:

  • Back up your computer files and keep important documents (such as a mortgage, note, and management contract) in a secure and fire-proof off-site storage facility.
  • Report suspicious objects, activities, and mail to the police, and take bomb threats seriously.
  • Document the location of utility shut-off valves, a step that can save lives and minimize damage if a fire or other disaster occurs.
  • Create an emergency procedures manual with an evacuation plan that’s tailored to your property.

Step #6: Lower the Risk of Crime at Your Property

In recent years, courts have increasingly found landlords partially responsible for crimes on their properties because they didn’t provide adequate security.

To prevent problems and keep your property and tenants safe, comply with state and local laws concerning security measures on rental properties. Screen your applicants and employees carefully — don’t just look for experience and know-how when it comes to filling a position on your staff. Adopt a smart key policy so that keys don’t fall into the wrong hands, and make sure your intercom system doesn’t link tenants to their apartment numbers. Answer prospects’ questions about security candidly, and deliver on any promise you make to increase security.

Step #7: Avoid Fair Housing Complaints When Choosing Tenants

If a prospective tenant believes you violated her civil rights, she may take legal action against you. Even if you win, defending yourself takes time, money, and energy.

To avoid problems, learn the basics of fair housing laws. The key to compliance is treating everyone the same. Some ways to do this include:

  • putting your screening criteria into a written tenant selection plan and giving a copy to applicants
  • rejecting applicants for legitimate business reasons, such as poor credit or negative references from prior landlords, and letting applicants know your reasons for rejecting them, and
  • keeping an updated log of apartment availability, and granting prospects’ requests for reasonable accommodations. For example, if you have a “no pets” policy and a prospect needs a guide dog to accommodate his disability, let him keep the dog as an accommodation.

Step #8: Adopt Careful and Consistent Business Practices

Many landlords create risks just by the way they go about their business. Be a careful and consistent landlord by using a written lease or rental agreement with tenants and by enforcing lease clauses consistently. Create house rules for tenants to follow (for example, regarding pets or children’s health and safety) and enforce them. Don’t let a friendship with a tenant interfere with your professional relationship. Also, to prevent identity theft, don’t use tenants’ Social Security numbers any more than needed.

Step #9: Avoid Problems When Hiring Help

Hiring help brings the promise of efficiency, savings, peace of mind, and profitability to your business — but it also brings risk. To lower your risk, determine whether you must classify a helper as an employee or an independent contractor.

For employees, be sure to withhold the appropriate payroll taxes and create a zero-tolerance policy against sexual harassment.

When using contractors, make sure they have insurance and sign a written contract with you.

If you’re considering hiring a management company or need to hire a lawyer, ask questions until you’re satisfied you’re choosing the right one.

Step #10: Taxes: Stay on Good Terms with Uncle Sam

Take steps to avoid a tax audit and to maximize your deductions. For example,

  • Establish a recordkeeping system for your business so that you keep track of every document that will substantiate your claimed income and expenses.
  • Understand how your choice of business structure and tax year affect your taxes.
  • Find out what deductions you’re entitled to claim, and then claim them.
  • Finally, hire the right type of tax pro for your business, and review your past returns for evidence of trends or problems.
Information obtained from nolo.com

For more help regarding these issues please visit:


FHA Bailout Imminent? Chief Says “No Way!”

Reports of an FHA bailout were widespread this weekend after the House heard testimony from a former Fannie Mae exec that the agency is heading over a cliff, with $40 billion in projected losses that will have to be offset by taxpayer dollars to buffer a flailing mortgage market.

But the current FHA chief dismissed the analysis as unfounded.
At the same time, however he admits that a yet-to-be released audit will show a shortfall in reserves, below the legal limit for the agency.  In related reports, the agency’s loan default rate may be as high as 20%.
Still, the agency chief denies that FHA is in trouble.  He claims that reserves will rise, not fall short over the next two years as home prices continue to rebound. 
Speculation over FHA’s financial soundness is nothing new.  Many experts have predicted that the agency is playing it too risky by allowing low down payments when negative equity is eroding the housing market. One referred to the practice as “pseudo-subprime.”
Expert testimony concluded last week with recommendations that FHA increase down payment requirements to 10%, lower the (recently elevated) cap on loan amounts, and require lenders to co-insure FHA loans.
However, for now, lawmakers appear willing to look the the other way, and remain optimistic in the housing recovery.  As Congresswomen Maxine Waters puts it, “Without the FHA, there would be no mortgage market right now. 
See more on Real Estate Financing at AAOA.
American Apartment Owners Association offers discounts on products and services for landlords related to your real estate investment including REAL ESTATE FORMS, tenant debt collection, tenant background checks, insurance and financing. Find out more at joinaaoa.


Patch Those Plaster Cracks

Tips for lath-and-plaster repairs

by Bill and Kevin Burnett, Inman News

Q: We are getting ready to repaint our home office. The walls and ceiling were cracked during an earthquake and poorly patched before we moved in. We had the roof redone last summer, and the banging and hammering seriously re-cracked the plaster. In two areas there is a large “plate” of plaster that is loose. You can press it and it moves closer to the wall.

My questions are: Can this be glued back into place, or must we remove all the loose stuff and replaster? How does one handle the bubbles (like an air pocket) that occur in the plaster? Any suggestions for a proper repair would be greatly appreciated. I can handle small holes and cracks pretty well.

A: Old plaster is the bane of old houses. Most often when we’ve been presented with old plaster walls we’ve opted to strip them and apply drywall rather than engage in the seemingly constant battle of repairing them. We also had an ulterior motive.

With the stud bays open, it is an opportune time to reconfigure lighting and electrical outlets to our liking and to add insulation to exterior walls.

But tearing out the plaster and drywalling a room is a ton of work, and we can appreciate your wanting to avoid it.

You’re on the right track when you ask if you can simply reglue the detached plaster. To understand how, it helps to understand the guts of lath-and-plaster walls. The 1 1/4-by-1-inch-thick wood, called lath, is nailed horizontally to the 2-by-4-inch wall studs. The lath is installed with 1/4-inch spaces between each piece. Plaster is applied in three coats and built up to a thickness of 3/4-inch to make the finished wall.

The plasterer forces the first coat of plaster — the brown coat — through the grooves between the laths. The plaster droops on the backside of the laths and dries, forming “keys.” These keys keep the plaster tight to the wall. Over time, with movement the keys break and the plaster becomes loose, forming what you call bubbles.

Reattaching loose plaster bubbles is a multi-step process. You’ll need a cordless drill, a 3/16-inch masonry drill bit, a wet/dry vacuum, adhesive and some drywall screws with plastic washers.

The first order of business is to protect the floors of the work area with drop cloths. Old plaster is composed in part of coarse sand and will destroy the finish of a wood floor or bore deeply into carpet.

Start by using the 3/16-inch carbide-tipped masonry drill bit to bore holes through the plaster. The masonry bit does well moving through the plaster and will not perforate the wooden lath. Drill evenly spaced holes — about every 3 inches — around the damaged wall area.

If you happen to hit one of the gaps between the lath, mark it with a pencil. Remember lath runs horizontally, so when you hit a gap, drill the next hole a little higher or lower. Clean dust from the holes with a wet/dry vacuum.

Be sure to purchase adhesive that will bond the plaster to the lath. Adhesive should come in a tube to be applied with a caulking gun. Check out the local paint store for their recommendation and follow the manufacturer’s instructions.

Trim the adhesive tube’s nozzle to the size of the holes in the plaster with a utility knife. Then inject the adhesive into each hole by giving the caulking gun’s trigger one full squeeze.

Immediately after squeezing adhesive into the holes, use the drill equipped with a Phillips head bit to screw drywall screws with a plastic washer into as many holes as necessary to pull the plaster tight against the lath. Wipe away any adhesive that oozes out of the holes.

Allow the adhesive to dry and remove all the screws and plastic washers. If necessary, scrape the rings from the wall with a putty knife. Scrape off any high points of adhesive off the wall with the 6-inch putty knife.

Apply a thin coat of joint compound to fill the holes. Let the compound dry overnight and sand the surface lightly with 120-grit sandpaper. Apply a second compound coat, let dry and sand. Now you have a solid wall, ready for paint or paper.

By the way, this is a topic that we saw Tom Silva cover years ago on the “This Old House” franchise. We nosed around the Web for a while and were able to find this video: http://www.thisoldhouse.com/toh/video/0,,20210037,00.html.
Copyright 2009 Bill and Kevin Burnett

See Bill and Kevin Burnett’s feature Do-it-Yourself Fix for Squeaky Floors.

American Apartment Owners Association offers discounts on products and services for landlords related to your real estate investment including REAL ESTATE FORMS, tenant debt collection, tenant background checks, insurance and financing. Find out more at joinaaoa.

Landlord Quick Tips

Stick to the Script!

Ever call up your applicant’s previous landlord, then hurry through the call because you didn’t know what to ask? Well, you are not alone!

Having a script can help you get the information you need.

Here are some questions that other landlords ask:


Is this a good time to talk, or should we reschedule when you have more time?

Did the tenant pay their rent on time, every time?

Did the tenant give you notice they were leaving? Are they leaving prior to the lease expiring?

Did neighbors or anyone complain about this tenant?

Did you ever have to warn the tenant about behavior?

Was the unit/property in good condition when they left?

Did you return all of the deposit?


Why did they leave?

Did they have a pet? Did you know they had a pet? Was the pet disruptive?

What type of unit did they rent? How much did they pay?

Did they pay by check?

It is a good practice to ask the same questions of each landlord reference, for each applicant. Create a checklist with the questions, and jot down the answers. Place the completed sheet in the tenant file.

American Apartment Owners Association offers discounts for landlords on products and services related to your rental investment, including real estate forms, tenant debt collection, tenant background checks, insurance and financing. Find out more at www.joinaaoa.org.

AC Outage Could Bring Rent Strike

Tenant displaced from unit fights for compensation

by Robert Griswold

Q: Our son is renting a condo in an area where it gets very hot in the summer. Two weeks ago, he came home from work to find that his air conditioning unit was not working. It was after hours on Friday evening and he tried to reach the property management agency to have them check it out, but no one was in so he left a voicemail message on their answering machine. They have no emergency number and the office is open only Monday through Friday from 9 a.m. to 5 p.m. The temperature reached nearly 110 degrees that Saturday and Sunday.

My son was inconvenienced — he couldn’t stay in the rental unit because the heat was unbearable. We watched his dogs for him and he spent the weekend at a friend’s house and went to work from his friend’s house. He was able to reach the property management office on Monday and they came right out to fix the air conditioning unit that same day.

He called them on Tuesday to talk with them about his inconvenience and the disruption to his life. He is trying to get compensated for having to spend time away from the place he was renting, having someone else take care of his dogs, and the physical and emotional strain of not being able to live in a home that he is paying to rent.

The property management company said not having air conditioning did not constitute an emergency, not even when it is 110 degrees. They claim that they actually do have an “on-call” person that regularly checks the answering machine throughout the weekend. But because their air conditioning company charges extra on weekends the earliest his air conditioning unit could have been fixed was on Monday, and that is what they scheduled.

He feels very strongly that he is entitled to significant compensation because his air conditioning unit ran for six hours straight to get the condo down from 96 degrees to 82. What are his legal rights? Can he withhold his rent for next month? Should he hire a lawyer? Maybe he should simply move out?

A: Clearly you and your son are very passionate about this issue and there is no doubt that he was inconvenienced. With temperatures over 100 degrees it can be very uncomfortable without the benefits of air conditioning. However, air conditioning is not automatically a required element of habitability in all areas, including some areas where it can get very hot at certain times of the year. So I would suggest he contact a local landlord-tenant attorney to see if there are some local laws that the attorney feels are applicable.

But let me offer a perspective as a property manager for the last 30 years, including many years in areas that can be very hot especially in the summer. I think your expectations may simply be too high.

The fact is that air conditioning units can and do go out on a Friday evening. Some landlords and property managers think that is when a disproportionate number of these types of problems seem to occur. Most repair personnel work Monday through Friday, and the few that may be willing to work on weekends or evenings will charge 1.5 to two times the usual labor rates, which are already quite high.

Thus, it isn’t reasonable to expect that an air conditioning unit that just happens to go out on a Friday afternoon could not be repaired till Monday. I understand the high temperatures and the impact on his personal living arrangements, but I think the response to this complaint by the landlord was very reasonable.

These things happen and unless you can show that the landlord was negligent and his failure to properly perform maintenance caused the air conditioning unit to break, then you have to understand that it takes time to respond to these situations.

In cases where such an outage constitutes an emergency — such as a threat to health or safety — the landlord may be required to make immediate repairs or to reimburse the tenant for emergency repairs. Again, check with a legal expert on applicable laws.

It may be appropriate for his landlord to offer him a rent credit for his inconvenience for the two or three days that he was without air conditioning. But your ideas of withholding next month’s rent or moving out seem to be overreactions.

We all face these types of inconveniences in daily life. Who hasn’t had a delayed airplane flight that led to missing a connection and completely disrupting one’s plans? But does that mean the passenger is entitled to a full refund? I know with my health insurance plan it can take days to get in to see someone and in the meantime I am in pain and have to limit my activities. But I certainly can’t refuse to pay my next month’s premium just because they couldn’t see me immediately. I can cancel my health insurance policy or vow to never fly on that same airline in the future, but moving out over this incident also seems to be adding to your son’s inconvenience.

I suggest your son sends a polite letter to the property management firm outlining the inconvenience and ask for a rent credit for the two days that he was without air conditioning.

This column on issues confronting tenants and landlords is written by property manager Robert Griswold, author of “Property Management for Dummies” and “Property Management Kit for Dummies” and co-author of “Real Estate Investing for Dummies.” E-mail your questions to Rental Q&A at rgriswold.inman@retodayradio.com. Questions should be brief and cannot be answered individually.
Copyright 2009 Inman News

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American Apartment Owners Association offers discounts for landlords on products and services related to your rental investment, including real estate forms, tenant debt collection, tenant background checks, insurance and financing. Find out more at www.joinaaoa.org.