December 21, 2009
As we’ve stressed several times throughout the course of this blog, here at Buildium we’re huge proponents of tenant screening. While some situations
can’t be avoided and there’s always an exception to every rule, tenant screening is certainly one of the most sure-fire ways to guarantee that tenants with the most potential to be problematic never make it to move-in day. For basic information on tenant screening, we hope you’ll check out this previous blog post. And now we’d like to get into some of the more specific tenant-screening topics, including who should pay for tenant screening and what you should do with the information once you’ve received it.
A couple things to keep in mind first, though. When seeking out the appropriate tenant screening solution for your property management business, you want a system that is both robust (in other words, it will provide you with a complete picture of potential tenants’ credit and criminal records) and secure.
Who pays?
This is one of those questions that doesn’t have a single answer. Ultimately, it is up to you whether you or your tenant pays for the screening process. The simple answer is to have tenants pay because, obviously, costs for screenings can add up quickly. Keep in mind, however, that because competing property managers may not have tenants pay for screening, you risk losing potentially good tenants who are looking to save a few bucks during the application process.
If you do opt to bear the costs of tenant screening on your own, it stands to reason that you will want the most thorough option available, without sacrificing accurate information. In our business, we’ve talked with a lot of property managers and know that smaller landlords can have a difficult time keeping up with more expensive resources larger property management companies have access to. Which is why we’ve formed a partnership with one of the nation’s top credit reporting companies, TransUnion. Property managers can access TransUnion services directly through Buildium software, enter in quick identifying information (such as an applicant’s Social Security Number), and receive all the credit and criminal record information necessary to make an informed decision. Best of all, there are no hefty monthly fees to contend with. This system allows you to pay only for the records you access, avoiding set-up charges and other hidden fees.
What do I do with the information?
There is both a literal and more figurative answer to this question. First the literal, which may sound obvious but bears repeating, nonetheless. Remember that the information you receive throughout the course of a credit check is personal, confidential information. It’s extremely important to protect potential tenants’ information, even if you do not end up renting to them. Make sure any credit check information obtained is either carefully stored in a tenant’s secured file (accessible only on a must-have basis) or, if you do not rent to the tenant, destroyed. Some landlords pass credit check information directly off to the potential tenant in question so that he may decide what to do with this information, whether that be destroying it or keeping it in his own personal records.
On a more figurative level, once you obtain tenant screening information, you should carefully consider it and weight it against other factors. For example, a tenant who has a clean credit and criminal record but questionable references from previous landlords may not be your best bet. On the other hand, a potential tenant who turns up a report with a mark or two against him from a few years back but receives a glowing recommendation from his current landlord may be someone you want in your rental.
Credit and criminal reports should always be obtained before renting to any tenant (no matter how great a first impression they make), but it’s also always important to weigh information obtained with personal and professional recommendations. You want to not only make sure you rent to someone who can pay their rent … but also someone you enjoy having in your property.
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Posted by Buildium
December 17, 2009
Property maintenance and major repairs are the keys to positive income. Following are some additional resources for keeping your properties well maintained, increasing your revenue, and reducing your long-term costs. Talk about a winning situation!
Leave a Comment » | Property Management | Tagged: aplliance, catastrophe, checklist, costs, income, kitchen, lorraine sinner, maintenance, management, money, prevent, prevention, property, Property Management, property manager, rental, rental property, repair, revenue, st. louis, video, vinyl, vinyl siding | Permalink
Posted by Buildium
December 14, 2009
No matter how meticulously you look after your property, there are certain long-term maintenance items and repairs that are inevitable. Sure, by staying
on top of things you may be able to stave some of them off for a bit, but some things are impermanent by nature and are going to have to be repaired or replaced sooner or later, no matter what you do. A savvy property owner will always keep these items in the back of her head because the big repairs are almost unfailingly also the expensive repairs. In order to avoid being submerged in massive expenses all at once, be sure that you keep the following long-range maintenance items and repairs in mind, stash savings away, and know how up-to-date you are at any given time in order to better project just when these expenses may come due.
Roofing
Price tag: $10,000 or higher
How frequently you have to replace your roof depends on a variety of factors, including the type of roof you have and the sort of climate you live in. For example, shake or wood shingles will last from 20 to 25 years; composition shingles will last for 12 to 20 years; rock roofs will last for 12 to 15 years, and metal roofs will last for 50 to 75 years.
Even though most of these time spans are rather lengthy, it’s important that you always know exactly how old your roof is so that you can forecast inspections and, ultimately, replacement. The lifetime of a roof can be extended to the longer end of its expected lifetime by religiously cleaning gutters and checking for leaks, exposed areas, and loose shingles. When it does come time to repair your roof, make sure you search long and hard to identify a quality roofer. Although you may pay more up front, you will save in the long-term when you consider the fact that thickness and quality of installation can significantly add to the lifetime of your roof.
Heating
Price tag: $3,000 to $5,000
Heating systems were not built to last forever. On average, a furnace will last from 14 to 20 years although, again, its lifespan is expanded or contracted based on the quality and frequency of repairs and general upkeep.
Having your furnace inspected once a year and diligently changing your air filter (up to once a month in climates that experience cold winter weather) is a great way to put off that furnace replacement for as long as possible. Taking these measures also saves you money in the short term (which can be stashed away to save up for that eventual replacement) by increasing energy efficiency and, thus, lowering heating bills.
Appliances
Price tag: $350 to $2,000
Particularly if you own multiple units, appliance costs can add up quickly. When it comes to appliances, unfortunately you cannot really control how tenants treat them on a day-to-day basis. Because this is out of your control, be sure that you perform a thorough inspection of refrigerators, stoves, dishwashers, and (if applicable) washers and dryers every time a unit switches tenants. Should you identify necessary repairs, be sure to fix them, no matter how small they may seem.
While all of these appliances separately don’t necessarily represent a massive expense, should you find yourself in a position where multiple appliances have to be fixed at once, you certainly will feel the pressure. And because appliances (particularly refrigerators and stoves) are such an integral part of tenants’ daily lives, chances are if an appliance does need to be replaced, you’ll have to take care of it immediately. With that in mind, be sure that you always have funds stashed away and at the ready should a spur-of-the-moment appliance replacement become necessary.
Although all of the items mentioned in this blog will have to be replaced sooner or later, as a general rule of thumb, a formal or informal inspection of their status on an annual basis will extend their lifetime significantly. But, just in case, be sure that you always have a stash of funds set aside for when the day comes that replacements are necessary.
2 Comments | Property Management | Tagged: air filter, appliances, dishwasher, dryer, efficiency, energy, expense, expenses, funds, furnace, heating, hvac, inspection, lifespan, maintenance, owner, property, Property Management, refrigerator, repair, roofer, roofing, savings, shingles, stove, system | Permalink
Posted by Buildium
December 10, 2009
Insurance … we all hate dealing with it, but we all need it. In the previous post, we discussed property, liability, and flood insurance. As per usual, more information never hurts, so visit the following links to learn more about insurance.
- One way to get in good with your new tenants is to recommend a renters’ insurance policy that protects them from the loss or destruction of their personal items.
- Don’t understand exactly what property insurance is? Check out this definition.
- A quick visit to our favorite friend (Mr. Wikipedia) provides a great overview of liability insurance.
- We don’t have this problem here in the more stable (but very chilly) land of Boston, but out west (and especially in California) property owners must be prepared with earthquake insurance.
- If you ever need to file a claim use the National Association of Public Insurance Adjusters to find a public adjuster in your area.
Leave a Comment » | Property Management | Tagged: adjuster, earthquake, earthquake insurance, flood insurance, insurance, liability, liability insurance, property insurance, public, public adjuster, rent, renters | Permalink
Posted by Buildium
December 7, 2009
The impending new year offers the perfect opportunity to make sure your “house” is in order, both literally and figuratively. No matter how
unappealing it may sound, getting all of those nagging little tasks off your must-do list is the perfect way to start 2010 off on the right foot. And, let’s be honest, dealing with property insurance is one of those items that fits squarely on this list. No one loves dealing with insurance, but we all have to. So take these last few weeks of the year to make sure that you have all the insurance necessary to protect your property. And if you’re feeling really ambitions, you can even to do a little research to see if there are any plans better than your own that may save you some money and offer a little more protection against the unexpected.
Landlord Property Insurance
It may sound trite, but landlord property insurance really is your best friend. Not only will it protect your physical property, but it will also protect you from lost revenue. If, for example, you are unable to rent out one of your units due to damage or if you expend legal fees in a tenant dispute, landlord property insurance may just have you covered, depending upon your policy. This type of insurance generally covers building damage caused by fire, lightning, wind, hail, cars, or collapse from ice, snow, or sleet. It also covers the landlord’s personal property (even if it’s being used by tenants) or in some other capacity on your property. This could include relatively high-ticket items like appliances and landscaping machinery such as snow blowers and lawnmowers.
Liability Insurance
No matter how meticulous you are about maintaining your property and making sure everything is as safe as possible, the truth of the matter is that things happen over which you have no control. Particularly when you bring the wild card of tenants into the equation. You can provide them with all the guidelines in the world, but it still doesn’t guarantee that tenants will follow them or that accidents won’t happen.
Thus, the importance of liability insurance. Liability insurance covers you in case third-party compensation due to negligence becomes necessary. While meticulous maintenance and attention to your property can go a long way toward protecting you against a negligence claim, the bottom line is that all it takes is a tenant’s trip over a loose floorboard to put you in danger of a liability claim.
Flood Insurance
Flooding is one of those natural events that may very well seem unlikely … until it happens, that is. Be aware that even if your property is insured, most property insurance policies do not cover flood insurance. The truth of the matter is that, particularly if you live in a high-risk flood zone, flood insurance can be expensive. But it’s also true that even an inch of water can wreak serious havoc on both your property and your possessions.
To educate yourself on what you do and don’t need in terms of flood insurance, visit the National Flood Insurance Program website. One final note about flood insurance: Most policies will not cover your tenants’ possessions should they be damaged by flood. Be sure to let your tenants know this ahead of time and recommend that they insure their belongings (again, especially in high-risk areas).
And if you’re still not convinced of the importance of insurance, consider this: Nolo cites insurance as one of the top ten deductions for landlords. “You can deduct the premiums you pay for almost any insurance for your rental activity. This includes fire, theft, and flood insurance for rental property, as well as landlord liability insurance. And if you have employees, you can deduct the cost of their health and workers’ compensation insurance.”
1 Comment | Property Management | Tagged: real estate, landlord, rent, tenant, rental, property, management, NOLO, money, snow, ice, manager, revenue, fire, insurance, house, assets, covering, property insurance, lightning, wind, hail, cars, liability, liability insurance, third-party, negligence, negligent, flood isurance, water, expensive, compensation | Permalink
Posted by Buildium
December 3, 2009
In case Black Friday and all the Christmas tree lots haven’t clued you in … it’s almost winter! Winter shouldn’t be all work and no play, so once you’ve finished winterizing your units be sure to go out and have some fun. Check out some of Buildium’s favorite winter fun ideas.
- Take advantage of the white powder and treat yourself to a ski vacation. Don’t know where to go? TripAdvisor.com is full of suggestions for top ski and snowboarding resorts.
- Do you toboggan? Neither do we, but it sure looks fun! Maybe we should all consider booking a flight for the 2010 U.S. National Toboggan Championships.
- As Bostonians, we love our hockey. Locate your local NHL team and root them on this winter.
- This isn’t just any winter … it’s an Olympic winter! Park your caboose on your couch and watch the 2010 Winter Olympic Games live from Vancouver, British Columbia.
- On a freezing cold day, get off your couch after hours of watching the Olympics, find a nearby lake, and do a little ice fishing. Just make sure to be safe!
Leave a Comment » | Property Management | Tagged: black friday, fishing, ice fishing, nhl, olympics, Property Management, ski, snowboard, toboggan, tripadvisor, vacation, winter | Permalink
Posted by Buildium
The companies that were able to grow their business in a down economy made extensive use of technology.
