Baltimore County HOME Act for Landlords

baltimore county home act what it means for you With all of the buzz surrounding the newly passed Baltimore County HOME Act, it’s important for landlords to understand all of the facts. As with any new legislation, there are differing viewpoints as well as a lot of misinformation floating around. The basic principle of the new law states that landlords cannot discriminate against prospective tenants based solely on their income source, and a housing voucher is considered a source of income.

What does the HOME Act mean for landlords?

In the past, it was a landlord’s sole discretion as to whether or not they wanted to accept tenants with housing vouchers. This is no longer the case as a housing voucher is considered a source of income and landlords can therefore no longer deny a prospective tenant based solely on their housing voucher status.

How is the housing voucher calculated as an income source?

Most landlords require that prospective tenants have a gross income of three times the monthly rent. When presented with a housing voucher as a source of income, the landlord can only require that the prospective tenant makes three times their portion of the rent.

Do I have to accept every prospective tenant just because they have a housing voucher?

The simple answer here is no. All landlords should have a clearly defined set of qualifications that are used to determine an applicant’s approval to rent. This often includes a minimum credit score, rental history, and a criminal background check. If an applicant fails to meet your minimum qualifications, regardless of voucher status, then you do not have to accept the applicant. However, if an applicant does meet your qualifications, you cannot deny them simply because they hold a housing voucher, as that voucher is considered a source of income.

Will I be able to charge more for a housing voucher tenant?

The housing office considers a variety of factors when determining a “Rent Reasonableness” amount for a particular property. The maximum amount they will pay varies based on standards such as the location of the property as well as the tenant’s income level.  The offer could be more or less than the landlord could receive from a market tenant. The four main criteria are as follows:

  • Fair Market Rent – this value is calculated by HUD and looks at all units that been rented in your specific area of the last 15 months
  • Payment Standard – local Housing Authority will determine their payment standard or the maximum amount they are willing to pay for each number of bedrooms, which typically falls between 90-110 percent of the Fair Market Rent. This is based largely on the ability of a voucher family to find quality housing in a particular area as well as the number of bedrooms and amenities in the home
  • Tenant Portion – A tenant who received a housing voucher will often have to contribute a portion of their income to the rent, which is usually 30% of their monthly adjusted income, but cannot be more than 40%
  • Utility Allowance – if utilities are included in the monthly rent, the Housing Authority will include that amount as an increased rent offer. If the tenant will be responsible for separate utility payments, the rent offer will be lower to allow the tenant enough money to cover their utilities without exceeding the maximum tenant contribution.

Pros and Cons of housing vouchers for landlords

In accepting tenants with housing vouchers, landlords increase the total number of prospective tenants looking at their home. The increased pool of prospective renters will likely limit the time a property spends on the market which will, in turn, minimize vacancy time. Additionally, in accepting a housing voucher, landlords can usually guarantee timely payment for at least the housing portion of rent each month.

On the other hand, accepting housing vouchers means increased paperwork and a more vigilant inspection process by the Housing Authority which could mean more upfront repair costs for the landlord. The process from application to move-in can take an average of 30 days to complete.

How can Bay Management Group help?

Bay Management Group has a team of seasoned professionals to navigate the voucher process. Our applicant screening process ensures that every applicant is screened and qualified in accordance with Federal, State, and Local Fair Housing laws. We are able to quickly and efficiently complete the necessary paperwork and schedule inspections to minimize processing time. Additionally, our dedicated property managers and in-house accounting team coordinate with the Housing Authority to set up payment schedules so that you get paid faster.


Tips for Finding the Perfect Roommate

go get a roomieSo you found that new home you’ve been looking for, but realize you don’t have enough funds in your budget to pay that monthly rent each month. Or, maybe you can afford the monthly rent, but you’re just not a fan of living alone. You decide it’s time to start looking for a roommate, but aren’t too sure where to start. Well, we’re here to help!

Let’s be honest, there’s no such thing as the “perfect” roommate, because, well, perfect doesn’t really exist. However, there is a thing, such as finding a roommate whom you’re compatible with. Read on to find out what Bay Management Group’s tips are for finding a roommate that suits you.

Don’t Ask Your Friends.

While it may seem like a great idea to live with your bestie, you may want to reconsider that option. Living with someone, is more than just sharing a place with someone you like and get along with. Sure, getting along with your roommate is important. However, things such as budgets and income, schedules, and cleanliness habits should also be considered. Believe it or not, friendships can be ruined or damaged over a roommate situation. Save your friendship, and look for a compatible roommate elsewhere.

Let’s Talk Money.

This may seem like a personal subject, but it’s important for both you and your new roommate to be honest with each other when it comes to how much money you make, and what your monthly budget looks like. You need to know that you have found someone who is willing to, and can afford to make monthly rent payments. In addition to rent, you’ll want to discuss other utilities as well, such as gas and electric, internet, cable, trash fees, etc. Keep in mind, that once you move into a new home, almost 99% of the time, your new landlord considers you to be one unit. That means, if your roommate is late on their monthly payments, it also falls on you. Finding someone who is responsible with their money, is only going to help you in the long run.

Set the Expectations.

It’s important that both you and your new roommate know where the other stands when it comes to personal space, cleaning habits, schedules, having house guests over, how you’re splitting the rent and utilities, and the list goes on. Discussing everything upfront, before you move in, will allow both of you to know what to expect from the other person. It’s important that you feel comfortable in your new home, and are able to enjoy living there. It’s also important that your roommate feels that way too. Knowing what the other expects, and respecting their wishes, will only help make your new living space that much more enjoyable.

Cats or Dogs?

If you have intentions of moving a furry, four legged friend in with you, this is a conversation that needs to be brought up immediately. You want to make sure your roommate likes and is OK with pets. Maybe they’re allergic to cats, or they’re not really a dog person. Maybe they want to bring their dog, who doesn’t get along with other animals. There’s many different circumstances, revolving around having a pet, you absolutely need to disclose that information right away.

Ask Questions

Finally, our last tip would be to ask any and all questions that you have! The only way to get to know someone is to ask questions about who they are, what they do, what they expect, what they’re plans are, etc. In order to make sure you have found a roommate who is compatible with you and your lifestyle, you must get to know that person. Don’t be afraid to ask whatever questions come to mind. Living with someone is a very personal experience, it’s OK to talk about some personal stuff. Just keep in mind, it’s important that you answer whatever questions your new potential roommate may have for you as well.

Living with a roommate may not be for everyone, and there’s always the option of renting a smaller place, just for you. Bay Management Group has everything from single family homes, townhomes, condos, and apartments. If you’re in the market for your new home, with or without a roommate, contact us today!


Rent Escrow: What is it, and is it Avoidable?

rent escrow marylandRent Escrow; we’d be lying if we said we haven’t heard this term thrown around quite a bit in the Property Management industry. If you’re new to being an owner of a rental property, this may be something you’ve never heard of before. In this blog post, we’re going to talk about rent escrow: what its purpose is, the process for filing a rent escrow, and what happens once an escrow has been filed. We’ll also discuss steps homeowners can take to ensure their tenants are not left in a position to want to file a rent escrow.

First things first, what is Rent Escrow? In the state of Maryland, landlords are required to make repairs and eliminate conditions that are a serious threat to the life, health, or safety of their tenants. If your tenant has reported items inside or outside of the property that need to be addressed, and you have failed to correct those items, the tenant can then file a petition with the local court house to place their rent into an escrow account. Some items that warrant the opening of a rent escrow include, but are not limited to: lack of heat, lack of hot water, electrical issues, rodent infestation, lead paint hazards, and the presence of mold. If a judge feels an escrow is warranted, they will rule in favor of the tenant, having them place all rent into an escrow account, until the appropriate repairs have been made.

In Baltimore City, once a tenant goes to the court house and fills out the required paperwork, a City Inspector will then be assigned to visit the property to complete an inspection. During this inspection, the inspector will notate any and all outstanding maintenance items. While all items may not qualify as a threat to the life, health, or safety of the tenant, the inspector will note any maintenance defects he or she finds. The inspector will then list how many threats are present. The total number of threats is what the judge is going to review, and what you, as a landlord, are required to correct.

After the inspectors initial visit, the next step is the first court hearing. For some landlords, there is only one court hearing, for others, there may be multiple. During the first hearing, the judge will review the inspector’s notes, and ask the landlord and tenant if the items have been corrected. If all items have been addressed, then typically the hearing is dismissed, and there is no need to move forward with opening a rent escrow at that time. If all or any items are still needing to be addressed, the judge will ask the landlord how long they need to correct the outstanding items. Based on the landlord’s response, a second inspection will be scheduled, followed by a second court hearing. If items are needing to be addressed during the first court hearing, the judge will most likely grant the escrow, and the tenant is to begin paying rent into the escrow account, until all outstanding items have been corrected.

At the second court hearing, all threats reported by the tenant and inspector should be addressed at this time. We also recommend that any maintenance defects, that are non-threats be addressed as well. The judge will then review the inspector’s notes from the second inspection to see what, if any items are left outstanding. Keep in mind, if the inspector finds any new maintenance defects or threats that differ from their initial inspection, they will make note of those items, and you will be required to correct those items, in addition to the initial items reported. If all items have been addressed, and there is nothing left outstanding, the next step will be disbursement of funds. However, if there are items needing to be corrected, this process will continue until all threats are addressed properly.

During the disbursement of funds, the judge will review the timeline for correcting the repairs. The judge will take into consideration how long it took to correct all items, from the time the issues were reported by the tenant. In most cases, the judge will abate a portion of rent, giving the tenant a refund of some of the money that was paid into the escrow. The landlord would then get the remaining funds. In other cases, the judge does not see a need to abate any rent, and all funds are disbursed to the landlord.

In Baltimore County, the process for rent escrow is very similar to Baltimore City. However, Baltimore County does not have an assigned inspector visit the property. Rather, the tenant is responsible for proving any maintenance issues to the court. Many tenants do this by providing photos or videos as evidence. The landlord would then be required to either disprove what the tenant is stating or prove to the court that all items have been addressed.

The best way to avoid having your tenant file a petition for rent escrow, is to ensure any maintenance items reported by the tenant are addressed properly and in a timely manner. By doing so, you are left with a happy tenant, who doesn’t feel the need to seek help from an outside source, to have items repaired in the home. It is important to keep in mind that as a landlord, your tenants do have rights, and there are laws that require landlords to take care of outstanding maintenance items as needed.

That being said, there are still times home owners find themselves having to attend a rent escrow hearing, and defend themselves, even after attempting to correct any maintenance issues reported by their tenant. Unfortunately, there is nothing that stops a tenant from filing a petition to place their rent into escrow. While you cannot completely avoid the possibility of a rent escrow hearing, working with a professional management company like Bay Management Group will help make the process a bit easier to navigate.

As a third-party management company, we keep record of any and all maintenance requests submitted by our tenants. All tenants have the option to go directly on to their tenant portal to submit and track the progress of each maintenance request submitted. We also work with a team of professional vendors, who keep record of all work performed. It is our company policy to require before and after photos of all maintenance jobs, so having photo documentation is never an issue for us! Finally, we are a team of management professionals, with years of experience. Preparing for and presenting our case in court, is certainly a task that we can handle with confidence.

If you’d like to learn more about our management services, and how we can make your life a bit easier, give us a call today!


Upgrades to Improve Your Rental Property Value

rental property checklist, rental property maintenance checklistWhen it comes to adding upgrades to your rental property, it’s important to make smart choices to increase rent and your bottom line. Rental property improvements need to find that perfect balance between investing enough to increase the value, but also avoiding spending money on the wrong things. Avoid over-improving your rental property and pricing yourself out of the neighborhood.

Top Upgrades to Increase Your Rental Property Value

  1. Upgraded Plumbing Fixtures

Over time, bathroom and kitchen fixtures can become grimy and outdated. For a quick and easy update, consider changing out faucets and shower heads. Avoid the standard grade chrome and upgrade to a more modern finish such as brushed nickel or oil-rubbed bronze for a more refined look.

  1. Bathroom Remodel

While it may not be necessary to completely gut the bathroom, replacing the vanity and light fixture is a quick and easy upgrade that can bring new life to your outdated bathroom. Many home improvement stores offer complete kits with vanity, sink, mirror and lighting. Add the upgraded plumbing fixtures and matching towel racks for a completely new look!

  1. Kitchen Remodel

A new kitchen will add instant value to your rental property! Stock cabinets can be purchased from your local home improvement store and easily installed. However, if a whole new kitchen doesn’t seem affordable, freshen the cabinets with new hardware and possibly even some paint. The one place to spend a little extra in the kitchen is a nice new countertop. Laminate may be the less expensive option, but they just don’t hold up, as they are easily stained, discolored or even burned. Consider granite, ceramic tile or another solid surface. Not only does this provide a more expensive look, but they are also more durable and stand the test of time.

  1. Flooring

When considering flooring options, look not only at price but also durability. Carpet is often the less expensive option, but requires professional cleaning and generally more upkeep from both you and your tenants. An LVT, or luxury vinyl tile will cost a little more upfront but will prove to be more durable and last longer. Cleaning and maintenance are easier and will last longer, ultimately saving you money.

  1. Paint

When budget is a concern and there just isn’t enough money for upgrades, a fresh coat of paint throughout the home goes a long way to making a home look clean and inviting. Remember to keep the paint color neutral and consider a better grade of paint so that marks and stains can be easily wiped down. This will minimize painting between tenants.

  1. Lighting

Are your light fixtures from the 80’s? Swap out those dated fixtures for a more modern look! Add lighted ceiling fans to also increase comfort as well as provide increased energy efficiency. If your property is lacking light, consider adding some overhead lighting to brighten the space and make it more appealing to prospective tenants.

  1. Don’t Forget the Basics

While providing cosmetic upgrades is a great way to increase value, make sure basic maintenance items are addressed first. Granite countertops won’t matter much if you have a leaking roof or mold in the basement. Don’t forget cleaning! Always present a clean and fresh smelling home because first impressions make a huge difference in attracting the right tenants.

A professional property management company can guide you in making the right choices in improving your rental property value. Bay Management Group has professional maintenance technicians on staff to assist with all of your maintenance needs. We also contract with a variety of professional contractors to get the best rates and pass those discounts on to our owners.


What is a Security Deposit, and How to Make Sure You Receive Your Full Deposit Refund?

security deposit baltimoreAs a renter, paying a security deposit prior to move in, is something you should expect and prepare for. Though security deposit amounts may vary, depending on the rent amount, credit check, income and rental verification, as well as any move in specials your landlord may be running, you can anticipate your new landlord to require a security deposit in addition to the 1st month’s rent. In this blog post, we are going to touch base on exactly what a security deposit is, and what it’s used for, as well as go over the steps you can take, to ensure you receive all, or at least most of your deposit back at move out.

First things first, let’s go over what a security deposit is, and why you’re being asked to pay one. A security deposit is a sum of money that a tenant pays to their landlord prior to moving into a rental property. Typically, the security deposit amount is equivalent to one or two months of rent. In the state of Maryland, the maximum deposit amount a landlord can ask for is two months of rent. A security deposit can be used for one of two things; financial protection as well as property protection. If you vacate the property, owing a balance for rent and/or utilities, your security deposit will be applied to any balance owed. If there are damages to the property at move out, such as carpet stains, broken appliances, or numerous marks on walls, your security deposit will be applied to the costs of those repairs.

Once your lease has come to an end, and you have decided to vacate the property you are renting, chances are, you’re going to want your security deposit to be returned to you in full. In order for that to happen, there are certain steps you will want to take to ensure you receive your full deposit, or at least most of it. Some of these steps should be taken prior to move in, while others will take place during your tenancy, and leading up to your vacate date. Continue reading to find out what steps Bay Management Group recommends taking for your maximum deposit refund.

Step One:

Read your entire lease agreement: While this may sound like a pretty obvious thing, sometimes we’re all guilty of not reading important documents in full. We skim through agreements, and only focus on the sections that asks for our initial or signature. However, a lot of important information is in that lease agreement, and you’ll want to be familiar with all of it. Your rental lease agreement is where you will find information pertaining to what, if any changes can be made at the property; such as painting or hanging items on the walls. Knowing what changes are and are not allowed to be made to the property, will help to ensure you’re not doing anything that would result in a charge at move out.

Step Two:

Ask questions: When reading your rental lease agreement, do not be afraid to ask questions, if you’re unsure of a certain statement or section within your lease. It is extremely important to make sure you fully understand and are clear of the terms of your rental lease agreement. Bay Management Group has a team of qualified leasing agents, who are here to  help answer any questions you have during your leasing process!

Step Three:

Ask what charges can be deducted from your deposit at move out: Prior to moving in, ask your landlord or leasing agent what potential charges can be deducted from your security deposit when you vacate the property. Having a clear understanding of what items may be deducted from your deposit, will allow you to plan ahead and avoid any potential damages during your tenancy. At Bay Management Group, we provide all of our tenants with a list of standard move out charges prior to moving in. This is great for rental tenants to refer to when preparing to vacate. Always ask if information like this is available to you.

Step Four:

Provide a move in report and take photos: Every property and landlord is different. What is considered “rent ready” to one landlord, may be completely different to another. As a new rental tenant, one of the very first things you will want to do is document the condition of your property at move in. Walk through each and every room, as well as the front and rear exterior, and document your findings. In addition to a written report, take tons of photos as well. Make sure you report all findings to your landlord, as well as keep copies of your report and photos for yourself. Bay Management Group, provides our tenants with a move in report on move in day. The move in report is always referred to, when completing the refund of a security deposit. This is a great way to ensure you’re not held responsible for damages that may have been present when you moved in.

Step Five:

Provide your forwarding address: In the state of Maryland, a landlord is to send deposit refunds, and all information pertaining to a security deposit to the last known address on file. When providing your notice to vacate, you should provide your landlord with your forwarding address at that time. If you are unsure of your forwarding address, just make sure you provide it to your landlord as soon as possible. Otherwise all deposit information will be sent to the property you are vacating from, which can result in a delayed deposit refund.

Step Six:

Make sure all rent and utilities are paid prior to vacating: It is important to check your rental tenant account, and make sure all rent, including utilities are paid in full prior to vacating the property. Keep in mind, any balance owed will be deducted from your security deposit. Depending on your deposit amount, this can lead to you owing a balance to your landlord. Owing a balance at move out can lead to having your account filed in collections, if left unpaid. The best way to avoid this, is to ensure all money owed is paid in full, leaving no balance due.

Step Seven:

Ask to be present during the move out inspection: In the state of Maryland, landlords are required to notify every tenant the date and time a move out inspection is scheduled to take place. As a rental tenant, you have the right to be present during the inspection, though you do not have to be. While most inspections are completed by maintenance personnel, who are not able to provide information with regards to your deposit refund, it is a good idea to be present during the inspection, so that you can see exactly what is being documented.

While sometimes damages to a property are inevitable, following the steps above will not only show your landlord that you are a rental tenant who cares about their property, this will also ensure you are getting the maximum deposit refund at move out. Don’t throw your money away to avoidable charges! Gather information, ask questions, and prepare accordingly. After all, moving is expensive, and receiving that security deposit refund will help with those costs!


Placing Qualified Tenants in Your Rental Property

placing qualified tenantsPlacing quality tenants is one of the most important aspects of renting your home. The goal is to find qualified tenants who will pay rent on time, follow lease terms, and take care of the home to avoid damages to the property as well as being respectful of the neighbors. While you may feel in a hurry to place a tenant to begin collecting rent, placing the RIGHT qualified tenant is more important. The non-qualified tenant is far more expensive than the cost of vacancy.

An important aspect of tenant placement is to have a solid set of application qualification guidelines. Applying these guidelines consistently ensures that every application is reviewed in the same manner and each applicant is held to the same standard of qualification. This practice will protect you as the landlord in making sure you are following all Federal Fair Housing Laws as well as any additional state and local laws. 

Each landlord or management company may have slightly different standards, but should generally be reviewing the following:

Credit Score

While a low credit score does not necessarily mean the applicant will be a bad tenant, there are certain factors to consider

  1. Set a minimum credit score for all applicants
  2. Review the amounts and types of debt on the report
  3. Look at the overall history of the accounts and what is affecting the overall credit score

Rental History

A strong rental history is often a sign that the applicant will be a qualified tenant

  1. Ask for the current/previous landlords contact information to do a rental verification
  2. The number one red flag is a previous eviction, which will likely disqualify most applicants
  3. Check for a history of late filings
  4. Always check to see if the applicant owes money to a previous landlord

Income

You want to make sure the qualified tenant has verifiable income to be able to make their monthly rent payments

  1. Applicants need to submit proof of income: this can be their two most recent pay stubs, most recent tax returns or sometimes a verifiable offer letter from a new employer
  2. Minimum combined household income should be no less than 3 times the monthly rent
  3. Consider the applicant’s other financial responsibilities when considering their ability to pay

Criminal Background

Keep in mind that having a broad policy of denying housing to a prospective tenant with any type of criminal history would be considered discriminatory under the Federal Fair Housing Act. Things to consider:

  1. Length of time since conviction
  2. Number of offenses
  3. Would the applicant put other tenants/neighbors at risk?
  4. Would the applicant put the property at risk?
  5. Does the conviction influence the applicant’s ability to pay?

 

Bay Management Group’s dedicated team of application processors ensure that each application is thoroughly reviewed in accordance with Federal Fair Housing Laws, State and local laws, as well as BMG policy. Additionally, we ensure that applicant information is kept confidential and secure in accordance with the Fair Credit Reporting Act. As a property owner, you can trust Bay Management Group to search for the most qualified renter to protect your investment.


Employee Spotlight: Andrew Fussell, Director of Business Development

property management professionals, property management companyAt Bay Management Group, we are property management professionals focused on customer service. Furthermore, our goal is to make property ownership both a pleasurable and profitable experience for our clients. We know that our success is due to our awesome team members, and how they each contribute something special to our property management company.

 

Therefore, we are initiating our Employee Spotlight to help you get to know more about our talented employees, and how their unique backgrounds and expertise help us stay a “cut above the rest.” Today, we are proud to introduce Andrew T. Fussell, Director of Business Development. Read on to discover all about Andrew, his professional background, and what he enjoys most about working here at Bay Management Group.

Andrew T. Fussell, Director of Business Development

Andrew came to Bay Management Group five years ago, working as a leasing agent for about four years before he transitioned into his current role 18 months ago. He’s worked in sales and customer service throughout his entire professional career, working in every capacity from bartending to managing a clothing store.

Andrew’s been a licensed real estate agent in Maryland since 2014, and before coming to BMG, he was a Realtor at Keller Williams. With so much real estate experience under his belt, he decided he wanted to get into the property management side of things.

A Day in the Life of Andrew T. Fussell

Andrew is responsible for bringing on all the new properties for the Baltimore office. From the very first phone call until they are assigned a dedicated property manager, he’s the point-of-contact. Andrew spends his days responding to new leads, reaching out to clients, and meeting with owners at their properties to explain how BMG’s property management services will benefit them. He’s also the guy in charge of sending out and entering new management agreements in the Baltimore area.

Why Andrew Loves Being Part of the BMG Team

Andrew loves getting to meet new people and seeing all the different types of beautiful architecture Baltimore has to offer. As a natural people person, Andrew has stepped right into his role and spends his days making sure our clients and prospective clients are happy and well cared for.

Andrew appreciates the fact that Bay Management Group is a local company that truly does care about the future of Baltimore. He says BMG is a family, and even as we’ve grown in size, we’ve never lost the closeness between employees. He enjoys the fact that BMG builds great relationships with our clients. In his eyes, you should have more than just a business relationship with clients; they should trust you like a friend. Andrew strives to be that trusted advisor to every property owner who reaches out to Bay Management Group in Baltimore.

Andrew’s Advice for Anyone Wanting to Get into Property Management

Andrew says people should take everything with a grain of salt. A lot of times, the people property managers come in contact with are frustrated, but they’re not always frustrated with you. Sometimes, they just need to vent and feel like they’re being heard.

Outside of BMG

When Andrew’s not in the office, he’s finding things to keep himself busy one way or another. He can’t stand idle time, so you might find him working on his house, spending time outdoors, or working on his ’66 Mustang.

Here’s Five Fun Facts About Andrew:

  • Name something off your bucket list.
    • Fish the White Marlin Open.
  • If you could meet anyone, living or dead, who would you want to meet and why?
    • Steve McQueen, I love his movies.
  • If you could learn to do anything, what would it be?
    • Play the Piano.
  • If you could dis-invent one thing, what would it be?
    • Social Media, I think we all spend too much time comparing our lives to others and not living our lives fully.
  • Pick three words to describe yourself.
    • Honest, Loyal, Hardworking

 

Bay Management Group is a full-service property management company here to help you with all your residential and multi-family property needs. Our business is strictly property management, so our specialization enables us to serve you better. For more information on our range of services, contact us today.


Pricing Your Rental Property

pricing your rental property baltimore

When deciding to list your home as a rental property, deciding on a listing price can be a very important part of that decision. While it’s important to consider your mortgage payment and all other costs associated with the home, you will also need to think of the cost of vacancy and turnover. Keep in mind that many homeowners, especially those with high mortgages, will not make a profit for the first few years.

There are many factors that will directly affect your homes rental value and the first step is to look at comparable homes in your area. Focus on rentals that are as similar to yours as possible and consider the following:

  • Neighborhood: the area in which your home is located plays a huge role in determining value as a highly desirable neighborhood will bring in a much higher rental rate than a similar home in a less popular area of town
  • Size: you will want to look at rentals that are similar in size with the same number of bedrooms and bathrooms
  • New Construction vs. Old: many renters are willing to pay a little more for a newer construction property as the amenities that are often higher end
  • Amenities: renters will often consider the amenities below when looking for a rental property
    • Updates: newer kitchens and baths with high-end appliances as well as hardwood floors are more desirable than units without
    • Square Footage: the size of your home will play a big part in the value
    • Layout: open floorplans are more sought after than more traditional homes. Also, a 3rd bedroom in the basement is not as desirable as having all three bedrooms above ground level
    • Bonus Features: amenities such as decks and a fenced yard or finished basements bring higher rental rates than a home without

Are you getting enough interest in your listing? If not, you need to reconsider the price as a lack of leads is almost always related to price. Once you’ve determined your initial listing price, you’ll need to remain flexible and consider market fluctuations, the overall economy, and supply & demand in your area. A low economy may bring more renters to the market as homeownership becomes more difficult. However, a huge supply of rental on the market will give prospective renters more options and room for negotiations.

The leasing team at Bay Management Group takes time to consider all of these factors when recommending a listing price for our owners. We use a variety of industry websites to compare rentals as well as our extensive knowledge of the market. With properties listed all over the Baltimore Metro area and surrounding counties, we are constantly watching the markets and work with owners to find quality tenants at the best possible rental rate while also trying to minimize vacancy time and turnover costs.


The Importance of Hiring and Working with Licensed Contractors

The Importance of Hiring and Working with Licensed Contractors
Here at Bay Management Group, we have the pleasure of working with a multitude of property owners, who have chosen to rent their property or properties out for various reasons. Whether your job is relocating you to a different area, your family is growing and more space is needed, or you’re a property investor, with numerous properties in your portfolio, having a rental property is a good way to bring in additional income on a monthly basis.

Having a rental property with tenants in place, however, also comes with the responsibility of making sure maintenance requests are completed properly, and in a timely manner. While a rental property can provide a positive cash flow each month, it is important to expect and be prepared for maintenance issues to arise, and paying for someone to repair those issues within a reasonable amount of time.

Now, if you are someone who specializes in HVAC, plumbing, roof, or electrical repairs, then you may be able to handle some of these maintenance items on your own. But, if you’re like many homeowners of rental properties, you will be relying on another individual to handle the job for you. In this month’s blog post, we are going to discuss the importance of hiring a licensed contractor to complete maintenance requests, and how doing so, can potentially save you money in the long run.

For example, your tenant just reported their A/C is not working. The system is not blowing cool air, and there seems to be a lot of condensation on the system itself, causing water to leak from the vents. Your friend, who is a handyman has offered to go out and take a look at the system. Having him go out will be far less expensive than sending a licensed HVAC technician out to inspect, so it makes sense, right? Not necessarily.

Fast forward to a week later, your friend thought he fixed the issue, but the tenants are reporting it has not been resolved. The water that was leaking from the vents has now caused interior damage to the ceilings and drywall, which will result in you having to repair that as well. In addition, you still have a HVAC system that is not functioning properly, on top of upset tenants who haven’t had a working A/C in over a week. That’s not all, the current lease with these tenants is up for renewal, and now they’re not so sure they want to commit to another year at this property. If your tenants vacate due to unresolved maintenance issues, you’re now looking at the possibility of paying for turnover expenses as well.

Let’s say instead of having a handyman go out for this repair, you chose to have a licensed HVAC contractor go out instead. Would the outcome be different? Most likely, yes. While the cost may be more expensive, you are paying for quality service from an expert of the trade. This individual will be able to diagnose the exact issue, as this is what he/she does day in and day out. They’ll provide a quote for repair or replacement, a timeline as to when you can expect the work to be completed, and that work will probably come with a warranty for parts as well as labor.
It’s also important to keep in mind that some jobs require permits to be pulled, and typically a licensed contractor is going to know exactly what is needed for that permit and how to successfully obtain it. Licensed contractors know the codes, have a crew of professionals ready to complete work properly, and will generally have a supervisor on site, overseeing each job.

Another thing to keep in mind is the paper trail. Nine times out of ten, a licensed contractor is working for a professional company, one who works off of work orders, provides written estimates, as well as detailed invoices. Documentation for each job is extremely important to keep for your records, especially when owning a rental property. Rent escrow is a real thing, and if you ever find yourself in a situation, where your tenant has taken you to court, you’re going to want comprehensive documentation.

If you have a third party management company managing your property, chances are, they already work with a good amount of licensed contractors, who they trust to get the job done. The best thing you can do, is allow your management company to coordinate all repairs with their contractor(s). While your friend, Jim may offer to handle repairs for far less money, that doesn’t always mean it’s the best route to take.

If you are an owner of a rental property who takes on the task of hiring contractors to complete different jobs, you are going to want to do a ton of research first. Read the online reviews, check the company status with the Better Business Bureau, ask for photos from previous projects, ask to see their contractor license, and make sure they have contractors’ insurance.

Lastly, if you’d rather have someone else do this for you, contact Bay Management Group! If you’re a property owner with rental properties in our areas of management, we’d love to discuss what we offer, and what sets our company and contractors apart from the rest.


Rental Property in Federal Hill, Baltimore

Baltimore's Inner HarborBooming nightlife and culture abound, Federal Hill is an attractive place to live for young renters looking to move to Baltimore, Maryland!

Located on the south side of Baltimore’s Inner Harbor, Federal Hill encompasses approximately 24 city blocks with Federal Hill Park rising above at the northeast corner, offering the best view in the city. The neighborhood is rich in history dating back to before the Wars of Independence, where the hill played a vital part in both military and maritime use. Today, the neighborhood is part of the National Register of Historic Places and the Baltimore City Historic District Ordinance.

In addition to the neighborhood’s rich history, Federal Hill in Baltimore offers its residents a neighborhood saturated in culture and art to include the Baltimore Museum of History and the American Visionary Art Museum as well a locally owned boutiques and galleries. A foodie’s dream, the neighborhood offers a variety of shops and restaurants and at the heart of historic Federal Hill is the Cross Street Market. Originally opening in 1846, Cross Street Market began a $7.3 million renovation in early 2018. In the spring of 2019, 6 vendors re-opened in the revitalized structure with an additional 10 vendors expected to open by Labor Day.

The amenities offered in this neighborhood rich in history and culture are a huge draw to young professionals, with more than 85% of Federal Hill residents having a college or advanced degree. In early 2013, developers took notice of the demand for rental properties and new construction took off. With the new market, rental property rates rose steadily through 2017 before the supply of luxury rentals far outweighed the demand. The resulting oversupply had a huge effect on the vacancy rate which currently sits near 10% in Federal Hill as opposed to Baltimore city which is less than 4%. This increased vacancy rate throughout Federal Hill caused fierce competition among developers as they dropped their expected rental rates and offered huge incentives to bring in tenants.

In spite of the oversupply and drop in rental rates over the past year, Federal Hill in Baltimore has remained one of the most sought after and pricey neighborhoods in the city. It is currently ranked as the the 4th most expensive neighborhood in Baltimore city, falling just behind Canton and Fells Point. There are certainly plenty of options available to renters ranging from luxury highrise apartments to refurbished historic townhomes. However, renters can expect to pay anywhere from $1600 to $2400 for a 2 bedroom unit.

Throughout the rise and fall of rental property rates, and the increased vacancy rate, Bay Management Group has maintained a steady supply of available rental units in the Federal Hill and South Baltimore area. We have been able to guide our owners in pricing effectively to avoid losses due to extended vacancy and make upgrades to keep their properties fresh and attractive for prospective renters. If you are a property owner, you can turn to Bay Management Group to assist with pricing, marketing and leasing your Federal Hill home.