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Leasing – Who Do I Rent To and How?

February 1, 2016

First, let’s pose some questions readers both novice and pro may have, or might need to get back up to speed on:

Who should I rent to? – If you are a novice, and own a duplex and are residing in one side, the ideal occupant needs to be compatible with your life style (hopefully), the family make-up should be suitable for the size of the space and number of bedrooms (some areas have ordinances on this, be sure to check), the family gross income per month should be at least 3 times the monthly rent, and they need to have good credit.

Is there anyone I should NOT rent to? – Obviously, an applicant that does not meet the above criteria. Always ask for a reference from a previous landlord. You can also request to do a “home visit” to determine if the applicants current residence is decent, safe and in a sanitary condition, without obvious damages caused by the current resident.

Who do I HAVE to rent to if any? – There are regulations from the Department of Housing and Urban Development (HUD) regarding Fair Housing rules Go Here to learn and get information about Fair Housing rights.

How do I set the monthly rent? – Ah, the bottom line 🙂  1. Check ads for rentals that are as closely similar to yours as possible (we will call them comparables or “comps”) in your neighborhood or area. Make an appointment to tour the “comp”. Take photos and notes about each property. Try to get an accurate square footage of the living area and then divide their asking monthly rent by the square footage: (example: $1,245 per month divided by 1,500 square feet  equals 83 cents per foot per month). Now do this calculation on all properties you visit (comps). If you visit 3 properties, take a sheet of paper and list the three properties across the top. Now down the left side list their amenities such as fireplace, central air, recreation room, extra bathrooms and anything else you think may be a difference from one comp to the other. This can include more square footage, garage and so on. Your rental apartmemt becomes the fourth property at the top. As you compare them, add or subtract (from the asking rent on each at the top) a dollar amount that you believe the amenities add or subtract from the rental amount. Example: Comp #1 has a garage and the other two do not. Deduct (put a minus) in #1’s column on the “Garage” line to even up the rent amount in relation to the other two. Is the garage worth $10, $20 per month or more when compared to #2 and #3? You decide. You can play with the items and numbers, but you are trying to even up the three comps. Lastly, compare average rents to square footage of the three. Now you have good basic numbers to help you decide what rent to ask for your property that will be competitive in your area!

More later! Send questions or inquiries to: propmgr@southernlandlord.com

NEXT……Let’s discuss how we “show” a vacant apartment!

February 17, 2016 – Are we ready to show that great 2 bedroom that just came available? Let’s do it !!

Here are the assumptions we will use before we get to the meat of the discussion:

  1. The apartment has been reconditioned (turned):

The apartment has been trashed out, any repairs/upgrades completed, prepped, painted, carpets cleaned/replaced. The apartment has been “punched out” (all maintenance performed), the apartment is professionally cleaned and all mechanical systems and appliances have been checked. Do yourself a favor and go see the apartment in person. Check for cobwebs by the entry door or on the exterior stairs, I am not kidding!. So Maintenance has “walked” the apartment with you and it is pronounced “ready”.

I want to emphasize here and forever…never, NEVER show a prospective Resident an apartment that is not READY!

2. We’ll assume that you have some advertising out there, so you are waiting on the walk ins, right?

Hmmm…….lets see:

Do you know from memory which voting district you’re in and the names of elementary, junior high and senior high schools?  If you do not provide utilities, do you have all the information your prospective Resident might need for electric, cable, telephone, etc? You need to know where the desired shopping areas are located, likewise for restaurants and entertainment venues.

3. Have legible printed floor plans available and know the exact square footage of each floor plan in your property or building and most of all, whether you will walk to the apartment or use a golf cart, don’t get lost!

Ok, lets set the scene:

You are at your desk and a couple walks in the office. You always assume that it’s a prospective Resident (it may be a Resident that you haven’t met etc). Make it a habit to get up from your desk and go to greet the folks! Make them comfortable at your desk (it’s easier to engage in conversation when everyone is seated) and ask how you can help them.

1. Begin to qualify the client. Ask pertinent questions relating to their living needs. What size Apartment do they want, what is their budget rental range for a proper sized unit, and when do they anticipate moving in (If they are looking for a 3 bedroom at a max rent of $1,000 mo and need to move in ASAP, and your availability is only two bedrooms starting at $1,200, you have saved the prospective Resident time, not to mention yours).

2. Let’s say they are right in your ballpark for an available apartment. Now you should begin to gather as much information as you can regarding their qualifications. Obtain the following before you leave to show the apartment:

  • Full names
  • Current address
  • Current home and work telephone numbers (from both applicants)
  • E-mail addresses

3. Prepare to go to the apartment you want to show. Make a copy of each persons driver’s license (very important safety issue).

Be sure you take a pen and notebook (I always used 3×5 index cards) to jot down notes to yourself when you take the tour with your clients. As you walk around the property, showing off the properties’ amenities, you can then casually gain information such as if they have pets, how many vehicles, how long have they lived at their current residence, what type of work do they do, etc. It’s easy to just note these things down on the card, it’ll come in handy, and will help you remember them later.

4. Show the apartment to it’s best advantage. Go to the apartment via the most scenic direction (going past the pool, for example), point out the ample parking, the free car wash, cookout areas, fitness center, etc.

5. Avoid discussion regarding the “profile” of your existing residents (Fair Housing). For example, point out that “because our property has two and three bedroom units and located close to a large office and professional park, we tend to have families with small or no children and singles with or without roommates.”

6. When showing the property, point out the location of the apartment, the locks on the entry door (card entry, etc) and exterior lighting. Try to determine who has the lead between the individuals, which spouse for example. Is their hot button the kitchen or the fireplace in the living room, or the size of the closets, etc. See if you can tell who is the decision maker, and begin your closing.

7. Closing: Never forget the axiom “Location, Location, Location.” You decide where and when you talk about your properties’ location. Do your homework; do you have a stoplight at your entrance? This can be a deal maker if you’re in a high traffic area! Are you close to shopping, etc, etc.  If asked about the cost of utilities, be honest. Give the best estimate, and include all the extra expense associated with the apartment (valet trash pickup, shared or “averaged water bills”, pest control, etc). Focus on what you determined to be their “hot button” and instill a sense of urgency (there are only two of this type available, so let’s get your deposit done today!) DO NOT BE TIMID ABOUT ASKING FOR THE DEPOSIT! Over half of leases are lost because an agent was timid about asking for the deposit or for the application to be filled out. Sit them down at the computer in your wi-fi cafe and walk them through the application process and ask for the check! CLOSE, CLOSE, CLOSE.

Coming Soon – The lease and move in process

While you’re here, check out our other pages….like “Belinda’s Day Diary”

Give us a shout at: propmgr@southernlandlord.com

 

 

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