5 Expert Property Management Tips to Write a Strong Lease Agreement

Posted on by Bay Management Group

Expert Property Management Tips for Writing a Strong Lease Agreement

The way you structure your lease agreement is going to set the tone for the entire term of your Potomac tenants’ stay.

In fact, the lease is often considered the crux of your entire rental property business.

However, drafting your own lease agreement from scratch can be challenging if you self-manage your rental properties and don’t know what to include.

Lease agreements need to have a lot of information built into them to make sure they’re strong enough to enforce with your tenants and in court, should a landlord-tenant dispute ensue.

That’s why knowing the basic steps for creating a strong lease agreement is crucial for maintaining a successful rental property business.

If you are wondering how to create an airtight lease agreement that addresses all of your needs, and protects yourself, your investment property, and your tenants, keep reading for pro tips.

 

1. Hire an Attorney

Hire An Attorney to Write a Strong Lease Agreement

If you are not using Potomac property management to help you draft a solid lease agreement, the next best thing to do is enlist the help of a local, experienced real estate attorney.

Having a lawyer on hand to help you draft your lease agreement is a good idea.

Why?

Because in addition to federal rental property laws you must follow, every state and city has their own specific landlord-tenants laws that you also must abide by in your written lease agreements.

The last thing you want to do is include something in your self-drafted lease agreement that violates a law.

Worse yet, you don’t want to have such a loosely stated lease agreement that clauses you have included can be used against you by knowledgeable tenants looking to take advantage of those not well-versed in the law.

Having an attorney look over a finalized lease agreement is not going to break the bank, and can end up save you lots of time, money, and hassle in the long run.

It is always a good idea to educate yourself about the rules and regulations that apply to you and your rental properties, so that you can always protect your own interests, whether you have a property management company or real estate attorney helping you out.

 

2. Have Multiple Copies of Your Lease

The beauty of modern technology and digital bookkeeping is a bonus for keeping your business organized and secure.

However, digital lease agreements have the potential to be altered, whether by accident or on purpose, by either the tenant or the software.

It is critical you have a paper copy of the lease agreement kept on file at all times to refer to in the case of a dispute. This way your tenant cannot make the claim that a clause in the lease agreement says something entirely different from what you originally drafted.

It is important to have your Potomac property manager discuss this paper copy lease agreement with your tenant at the time of move-in, as well as have them sign the document so you have hard proof that everyone involved knew exactly what was expected of them at all times throughout the lease term.

 

3. Address Lease Changes

Address Lease Changes With An Addendum For Your Rental Property

Sometimes lease agreements change during the course of a tenancy.

However, in order to create a strong lease agreement that prevents changes of all kinds from sneaking into the lease agreement, you must include a clause stating that any changes to the lease agreement will only be considered valid if in writing.

Do not give your tenants the power to “add” lease changes to the original lease agreement from verbal conversations you or your property manager have with them. This can lead to a lot of miscommunication, and changes to the lease you did not approve.

For example, your tenants may have moved into your rental without any pets. And, the lease agreement may clearly state no pets are allowed.

However, perhaps halfway through the lease your tenants approach you or your property manager with a request to get a puppy. And, you agree to this.

Make sure to add a pet policy provision into the lease agreement and have your tenants sign it so they know the rules regarding this new lease clause. Include things like breed and size restrictions, pet deposits and fees, and the consequences if the pet damages your property during their lease term.

If you don’t do this, you could end up with 10 dogs roaming your rental property damaging everything from the interior of your property to the exterior landscaping, all because you verbally said to your tenants that they could have a dog.

The pet policy is just one example of how your written lease agreement can falter if you allow verbal changes to change it.

Protect yourself and your investment by only allowing written changes to be incorporated into the original lease agreement.

 

4. Make Your Writing Clear

Your lease agreement should be extremely clear for anyone that reads it.

Use simple terminology, make it short and to the point, and never leave any open-ended clauses that allow room for interpretation.

If things are not clear, and your tenant can poke holes in each lease provision, chances are the written document you thought was in place to protect all parties will actually be used against you.

Some of the most important provisions to outline clearly in each lease agreement you draft include:

  • Security deposit collection, use, and return procedures
  • The rent amount, when it is due, and the consequences for late or non-payment
  • Maintenance and repair procedures, what will and won’t be covered by you, and what the tenants are responsible for
  • Whether temporary alterations are allowed, and which ones
  • What to do in the case of an early lease termination
  • Your right of entry procedures, complete with notice information
  • Roommate, use of property, and code of conduct rules
  • What happens should any lease provision be breached throughout the lease term

 

This is not a comprehensive list of the important lease clauses to include in your lease agreement.

Rather, it is a list of some of the most important ones that have the potential to create many legal problems for you, should they not be addressed correctly.

 

5. Customize Your Template

Customize The Template For Your Lease Agreement

Using a lease agreement template is okay, especially if you self-manage your rental property. However, you should be aware that lease agreement templates are not one-size-fits-all forms that apply to every landlord in the country.

Both Maryland and Potomac have specific rules and regulations you must follow when it comes to lease drafting. That’s why customizing your template to fit your individual needs, and address the state and local laws is a must.

 

In Closing

If you are looking for a high-quality property management company in Potomac, MD to help you write a strong lease agreement for your rental properties, contact Bay Management Group now.

We have the knowledge to make sure your lease agreements are legally compliant. We will take the time to address every personal provision you want to include in your agreements, and make sure that your tenants understand exactly what is expected of them at all times during their tenancy.

How Often Should You Schedule Rental Property Inspections?

Posted on by Bay Management Group

How Often You Should Schedule Rental Property Inspections

Conducting routine inspections of your rental property throughout your tenant’s lease term is an excellent way to ensure your property is being well maintained.

Plus, it offers you a chance to address small maintenance and repair issues before they become bigger, as well as the chance to make sure your tenants are satisfied.

It is important to know, however, how often you can inspect your rental property so that you don’t disrupt your tenant’s living experience and don’t risk violating any tenant-landlord laws.

 

When Can You Inspect Your Chevy Chase Rental Property?

In short, you are legally allowed to inspect your rental property whenever you want, so long as you don’t violate your tenant’s right to quiet enjoyment.

In fact, landlords are allowed to drive by, walk by, or bike to their property anytime they want and inspect the exterior to make sure everything looks okay.

That said, your tenants are afforded certain rights when they move into your rental property that ensure you don’t intrude on their day-to-day living.

Tenants have the right to enjoy a peaceful and quiet living experience while leasing from you. This includes the right to a reasonable amount of privacy, freedom from disturbance, and the ability to use any common areas without any significant interference by you.

This means that, despite your pressing concerns about your rental property, you cannot intrude on your tenant’s right to enjoy the property throughout the lease term whenever you want.

And if you do, know that your tenant will then have the right to discontinue paying their monthly rent and leave the premises as they please, with no consequences for breaking the lease early.

 

The Best Times to Inspect Your Rental Property

Despite being able to inspect your rental property whenever you please with proper notice and a legitimate reason, it is best to so you do not become a bother to your tenants.

Below are some crucial times during a tenancy that you should make sure to inspect your property.

 

Move-in and Move-Out Time

Conduct Inspections During Move-In and Move-Out

Your Chevy Chase property management company will have you inspect your property at the time your tenants move in, as well as when they move out at the end of their lease term.

When your tenant moves in, your property manager will inspect the original condition of the property. This way, come the end of the lease term, you are able to determine what damages your tenant may have caused the property while residing there.

Looking beyond what is considered normal wear and tear, any damages found that can be attributed to tenant abuse or neglect are then covered by the tenant’s security deposit, which should have been collected at the time the tenant moved in.

It is important your tenant is aware these inspections will occur. This way they know you will be looking for instances where they may have damaged your property, and that their security deposit is on the line if damages are found.

Lastly, your tenants are likely to take better care of your property knowing you will be combing the property thoroughly at both the beginning and end of the lease term.

 

Check for Unauthorized Tenants

Sometimes you may feel there are unauthorized tenants living in your rental property.

This is common when a tenant begins to house a boyfriend or girlfriend, when a friend needs a new place to live, or when a family member overstays at your property.

Unfortunately, these instances easily turn into a roommate situation that, unless authorized by you, becomes a breach of the lease agreement.

You and your Chevy Chase property manager should have drafted the lease agreement to outline the rules regarding roommates. Some of those rules include:

  • Any roommate wanting to stay at your property must be screened and authorized by you and your property manager
  • The new tenant must sign the new lease agreement ensuring that they will pay their portion of the rent
  • The new lease agreement should have a joint and several liability clause protecting you and your investment property
  • Consequences for housing unauthorized tenants, including eviction, should be outlined so tenants know what can happen if they try to cheat the system

This is all assuming you even allow roommates, which you very well may not.

In any case, should you suspect that your tenants are housing unauthorized tenants, you might want to consider a quick inspection of the property to see if any extra rooms are being used, furniture has been added to the property, or additional people are actually present that are overstaying.

 

Check On Maintenance Needs

Check on Maintenance Needs in Your Rental Property Inspection

Checking your rental property regularly for small maintenance and repair issues is always a good idea.

Sometimes your tenants may fail to inform you about small issues such as leaky faucets. Other times, they may not even be aware there is an issue at all.

Either way, staying on top of small maintenance needs is a great way to keep your tenants satisfied and avoid large repairs costs for neglected repairs.

Conducting these types of inspections during the season changes is a great way to make sure they happen consistently, and do not bother your tenants too much.

When it comes time to winterize your property, do a quick run-through of the entire property, complete with a rental property safety checklist, and make sure everything is in pristine condition.

Do the same during spring when you want to spruce up the landscaping, during summer when it comes time to prepare your property for the colder months, and of course, during fall when things like rain gutters and pipes need checking.

While you’re at it, during these seasonal inspections you should take the time to make sure your tenants are following through on their obligations such as changing the air filters, maintaining major appliances, and keeping up on the landscaping, should these things be their responsibilities.

 

When a Tenant Misses Rent

When Your Tenant Misses Rent, Conduct a Property Inspection

When it comes to running a successful rental property business, you must make sure your lease agreement is drafted to ensure prompt rent collection procedures that your tenant understands from the very beginning.

If at any time your tenant misses a rent payment, you might consider stopping by to see what is going on.

This proactive approach may be able to solve a small issue, and help prevent a bigger issue such as an eviction and a vacant property in need of new tenants.

Find out why the tenant has missed their rent payment, issue proper notice that they need to pay up immediately, or enlist the help of your Chevy Chase property management company to start the eviction process if necessary.

No matter what steps you need to take, know that inspecting your property at a time like this may save you a lot of trouble down the road.

Whatever you do, however, do not take matters into your own hands after inspecting your property and noticing that your property is being poorly maintained or the rent is not being paid on time. This can lead to lots of legal trouble and make things much worse for you.

 

In Closing

It is your job as a landlord to inspect your rental property to make sure your tenants are fulfilling their roles, paying on time, and caring for your property. In addition, it is your job to maintain the property to the highest standards possible so your tenants are satisfied, and want to renew their lease with you come the end of the tenancy.

If you want help with regularly inspecting your investment property, contact Bay Management Group today to connect with our experienced property managers in Chevy Chase, MD.  We can help draft lease agreements that outline the inspection process and responsibilities of all parties involved.

In addition, we can conduct the actual inspections of your rental property so that you know everything is being handled properly, and that both you and your tenant’s rights are being honored.

Expert Ways To Make Your Rental Property Landscaping More Manageable

Posted on by Bay Management Group

How to Make Your Rental Property Landscaping More Manageable

First impressions are everything in life.

In order to make new friends, get hired for a new position, and yes, even to land a new tenant in your Elkridge rental property, first impressions are important.

As a landlord, you may not be too keen on the idea of investing your hard earned money into landscaping your rental property, if you are not going to be the one that enjoys it.

However, it is a widely accepted fact that curb appeal (how attractive the exterior of your property looks, including both your front and back yards), makes all the difference to prospective tenants.

That’s why today we are going to take a look at some easy ways you can make your Elkridge rental property landscaping stand out to potential tenants, without adding a great deal of hassle to your life.

 

How to Easily Manage Your Rental Property Landscaping

Whether you decide to tend to your rental property’s landscaping yourself, outsource to a reliable landscaping company, or enlist your tenants to lend a hand, having a solid foundation is the key to great looking yards that last all year long.

 

1. Fake It

Use Fake Grass to Make Rental Landscaping Manageable

We are not talking about faking the fact that you are investing time and money into your landscaping efforts.

What we mean is that if you really want an easy-to-manage solution to having green grass in your rental property’s yard that lasts year round, consider installing synthetic (fake) grass.

While the debate behind whether synthetic grass is a good idea or not still stands, the truth is, fake grass is easy to manage and comes with plenty of advantages.

In fact, according to HouseLogic, there are some key reasons synthetic grass is gaining popularity:

  • The upfront cost is recovered quickly after installment
  • It saves water which is not only eco-friendly, it helps save your tenants money
  • There is no maintenance when it comes to mowing, watering, seeding, edging, and fertilizing
  • The weather will not kill it (though you should take care if your property is in a hot region)

In addition, synthetic grass simply looks good.

Your rental property’s yards, especially the backyard, should be an oasis escape for your tenants to enjoy all the time. Fake grass has the ability to look and feel very much like real grass, which can be very inviting.

 

2. Go Native

Plants that are native to Maryland are going to be the easiest to manage throughout the year, regardless of who is in charge of that task.

Here are some of the most popular Maryland native plants that will suit all of your landscaping needs:

  • Groundcover. Pussytoes and Golden Groundsel are great for covering large sections of yard with an easy to manage plant. Plus, they work well to keep weeds at bay.
  • Ferns. For a lush, green look, add Sensitive and Christmas Ferns to your yard.
  • Grasses, Sedges, and Rushes. If you decide to forgo the synthetic grass for your rental’s landscaping, use Blue Sedge, Wool Grass, Little Bluestem, or Yellow Indiangrass instead.
  • Wildflowers. There is nothing more beautiful than flowers in an array of colors spanning your property’s backyard. Use Cardinal Flowers, Foxglove Beardtongues, Butterfly Weeds, or New York Ironweeds to add pops of color to your garden.
  • Shrubs. For the places in your yard that need a little extra coverage, consider Rose Mallow or Hillside Blueberry shrubs.
  • Trees. Maintaining trees can be a major hassle if you use non-native ones. That’s why Blackgun and White Oaks are going to be your best bet.

This is just a sampling of the types of native plants that will fare well in Maryland.

They are naturally occurring in the region (which is why they can withstand the elements), and are easy to take care of no matter your skill level.

 

3. Add Patio Space

Add Patio Space to Make Your Rental Property Landscaping More Manageable

If you are really looking to decrease the amount of time needed to maintain your Elkridge rental property’s landscaping, try adding a sizeable patio section to the backyard.

An excellent selling point when it comes to placing a new tenant in your rental, large patio spaces can serve multiple functions.

This area makes hosting family and friends a cinch for tenants that like to have get togethers. Patios are also great places to store equipment for the different seasons (such as your ski gear for winter, and your boating accessories for summer).

Lastly, there is little to no maintenance required when it comes to well-designed patios, save for a little sweep or watering down every now and again.

And, if you are really looking to impress prospective tenants, consider investing in some outdoor patio furniture, lighting, and even a BBQ with a food prep station so your tenants can get the most out your property’s backyard area.

Just don’t forget to add storage space for your tenants to store things like patio cushions during the rainy season or during times of non-use. This way the furniture textiles you have invested in do not become ruined (because replacing these things often will become costly).

 

4. Consider Water Use

While adding native Maryland plants is a great idea, and they typically do not require a lot of water, it is still crucial you think of overall water use when you design your rental’s outdoor space.

Maintaining a fully functioning sprinkler system opens you up to regular maintenance and repairs, especially when winter arrives and pipes have a tendency to freeze.

And, if you choose to water your yard by hand (or require your tenant to do so), the easy to maintain yard quickly becomes a hassle that is not easy to manage.

By using lots of groundcovers, as mentioned above, you reduce the amount of watering that your yard needs. In addition, these groundcovers will help keep other plants from overgrowing, will protect the soil from the elements (such as extreme hot or cold), and will only require an occasional rake here and there.

In fact, a region such as Elkridge experiences a lot of annual rain, even during the “dry season,” which means there is very little watering you will need to do with a large groundcover such as Golden Groundsel.

 

In Closing

When it comes to your rental property landscaping, there are a few factors to consider before jumping in and designing a tropical jungle.

You must consider what role each party will play in the maintenance of your property’s yards, how much work you want those tasked with landscaping to do, and how much money you want invested in the overall project.

If you are looking for an excellent property manager in Elkridge to help with tasks such as maintaining landscaping, lease drafting, rent collection, and seasonal inspections, contact Bay Management Group today.

Not only can we advise you on how to maximize the outdoor space your investment property has, we can assure you that your tenants fully understand their responsibilities when it comes to the maintenance of your yards, no matter how easy it is.

Our goal is to garner you high quality tenants that will care for and appreciate your rental’s landscaping, while collecting the highest rent rates possible as a reward for all your hard work in creating the perfect outdoor space.

The Ultimate Safety Checklist for Your Bethesda Rental Property

Posted on by Bay Management Group

Ultimate Safety Checklist For Your Bethesda Rental Property

Tenants expect, and have a legal right to, a safe, secure, and healthy place of living when they lease from you.

This means you have an obligation to keep your tenants safe inside your investment property, secure from outside intrusions, and protected against any health concerns.

Unfortunately, if you don’t take the time to thoroughly inspect your Bethesda rental property regularly, issues tend to creep up and accidents happen.

However, a lot of that is preventable with routine property inspections, and a little bit of knowledge about how to keep your property safe for your tenants.

Enlisting the help of Bethesda property management is one great way to tackle rental property safety.

However, there are things you can do on your own to ensure your tenants feel safe while leasing your property.

 

Rental Property Safety Checklist

In the past, we have discussed extensively how to keep your tenants safe while residing in your rental property.

In fact, we even suggested that using the knowledge, experience, and maintenance crew a high quality property management company provides is the best way to keep your tenants safe, secure, and happy.

That said, empowering yourself with the details can be helpful when it comes to rental property safety.

And, while your property manager is well equipped with information regarding Maryland rules and regulations as they pertain to rental property safety, brushing up on your knowledge using this helpful rental property safety checklist is highly recommended.

 

1. Exterior

Check the Safety Of The Exterior of Your Bethesda Rental Property

The exterior of your rental property is not normally the first place that pops into mind when you think about tenant safety.

However, that doesn’t mean that you should ignore the safety of this part of your rental.

Here are some of the most crucial safety issues you and your property manager should concern yourselves with when it comes to the exterior of your rental:

  • The entire framework of your property should be sound and secure
  • All exterior portions of your property – the roof, foundation, and other exterior surfaces – must keep rodents and pests out at all times
  • Walls should have no visible holes, breaks, or rotting timber that would allow dampness to enter the property during rainy seasons
  • Roofs must have adequate drainage of rainwater to prevent structure wall deterioration
  • Any exterior surfaces made of metal or wood must be painted, weatherproofed, and sealed to prevent deterioration
  • Awnings, stairways, and overhangs must be secure at all times to keep them from falling, and also to protect them from decay and rust
  • Stairs, porches, balconies, and fire escapes must be able to handle their anticipated loads without collapsing
  • Windows, doors, and frames must prevent wind from entering the property, as well as rainwater and rodents, or other pests
  • Any windows used for ventilation and/or emergency escapes must easily open from the inside and be held in place using proper hardware
  • All exterior stairways and exits must be illuminated to discourage intrusion
  • Lighted pathway to the house for your tenants
  • All exterior door locks must be tightly secure and in good repair
  • From April 1 to December 1, it is your duty to provide tight-fitting screens for all doors, windows, or other openings used for ventilation

 

In addition, your Bethesda rental property may undergo inspection by the County Building Engineer.

If that happens, inspectors will require you to fix the following issues if anything is missing or deteriorating:

  • Any exterior features that create an unsafe condition for your tenants
  • Rotting of exterior walls or vertical supports that hold the property together
  • Deterioration of roofs or other horizontal features, such as balconies
  • Issues with exterior chimneys
  • Plaster or masonry that is crumbling, falling off, or otherwise deteriorating
  • Degraded weatherproofing on any exterior walls, roofs, or foundations
  • Any broken windows or doors

 

As you can see, Maryland does a good job of ensuring that your tenants will be safe from both the obvious safety and health issues that threaten the exterior of your rental property, as well as the lesser-known issues landlords may not know to look for during property inspections.

 

2. Interior

Check the Safety of the Interior of Your Rental Property

It can sometimes be easier to spot safety and health issues on the interior of your rental property.

However, it is always a good idea to familiarize yourself with the things the authorities are going to look for during property inspections, to make sure everything is safe and secure.

While there are many places to check on the interior of your rental, today we are going to focus on the plumbing, as there are plenty of rules and regulations concerning the plumbing:

  • Kitchen, bathroom, and toilet floors must be significantly waterproof, for sanitation reasons
  • All interior structures found with rodent or pest infestations must be treated in a way that is not harmful to your tenant’s health
  • There must be a separate room with a toilet and cold running water that affords your tenants privacy
  • Nearby each toilet there must be a sink with hot and cold running water
  • Each property must have at least one room equipped with a bathtub or shower that has hot and cold water running water that affords your tenants privacy
  • All fixtures, vents, drains, and water supply lines must work properly and be free of any leaks or defects
  • Plumbing fixtures must not only work properly, but must avoid inviting rodents or pests in, as well as never emit dangerous or offensive gases and odors
  • Hot water must run from each faucet at a temperature of at least 110 degrees Fahrenheit

 

Although this may seem tedious, it is important to know what is expected in your rental property when it comes to plumbing issues.

3. Smoke Detectors and Carbon Monoxide Alarms

Check the Safety of Your Carbon Monoxide and Smoke Detectors In Your Rental Property

There is sometimes confusion over whether maintenance of smoke detectors and carbon monoxide alarms are the responsibility of the landlord or the tenant.

 

Smoke Detectors

Property owners in Bethesda must install at least one electronic smoke detector in each residential property or unit.

Additionally, properties built before 1976 must include a battery-powered backup.

Every three years, property owners must submit written verification by a licensed electrician or the County Fire Department and Licenses that the smoke detector has been installed as required by law.

This verification will also certify that the detector is in good working order.

 

Carbon Monoxide Alarms

When it comes to carbon monoxide alarms, Maryland takes a hard stance.

To start, all rental properties that have fuel-burning equipment installed must have a working carbon monoxide alarm.

Each alarm must be installed in the common area of the property.

In addition, your tenants must be able to hear the alarm that is installed in the bedroom areas.

It is important to note that the carbon monoxide alarm sound must be easy to distinguish from the smoke detector’s sound.

Lastly, upon installing and testing each carbon monoxide alarm in your rental property, you are required to provide written documentation to at least one adult tenant in your rental instructing them how to maintain and test the alarm.

Have this tenant read and sign the document and keep it for your records.

Tenants leasing from you must do the following:

  • Test and maintain carbon monoxide alarms according to the manufacturer’s instructions
  • Replace batteries when needed
  • Notify you, via written certified mail, of any malfunctions

 

If you receive written notification that the carbon monoxide alarm is malfunctioning, you are then responsible for the repairing or replacing it.

 

Ensuring the safety and health of your Bethesda rental property and, more importantly, your tenants is serious.

It is your legal responsibility to make sure that your investment property is up to code and does not present any safety issues to those leasing from you.

And, one of the best ways to do this is to educate yourself about the state and local laws.

In addition, by regularly inspecting your rental property, you will be able to make sure that any maintenance, safety, or health concerns are addressed quickly, and do not affect your rental property business.

Better yet, by contacting a property management company such as Bay Management Group, you will have access to knowledgeable property managers and a reliable maintenance crew that can help you prevent any major safety issues, and can repair any minor maintenance issues that pop up during your tenant’s lease term.

What Are the Responsibilities of a Property Management Company?

Posted on by Bay Management Group

What Are the Responsibilities of Your Gaithersburg Property Management Company?

If you own rental property in Gaithersburg and self-manage your rental property business, you may be finding that there is a lot more to being a landlord than you originally anticipated.

And with that in mind, you may be thinking it is time to enlist the help of one of Gaithersburg’s top property management companies.

You may also be wondering to yourself what exactly a property management company is responsible for when it comes to your investment property. 

For those that are unsure whether investing in a property management company is a good idea, or for those that simply don’t know what a property manager is responsible for, keep reading.

Today we are going to give you the rundown on what an experienced, highly qualified property management company should offer you in terms of services.

 

What a Qualified Gaithersburg Property Management Company Should Do

1. Property Advertising

Property Management Company Should Advertise Property

One of the most important responsibilities your property management company has is advertising your vacant property to a high-quality tenant pool.

They should utilize a diverse set of platforms such as Craigslist, MLS, online classifieds, and even direct mail to expose your property to a wide group of prospects. They should also be available for those reaching out with interest.

 

2. Tenant Screening

All potential tenants should be thoroughly screened by your property manager. This includes background and credit checks to make sure they have no criminal background, previous evictions, or outstanding debts.

Additionally, your property management company is responsible for avoiding any discrimination when it comes to fair housing laws and screening potential tenants.

This is a key reason to enlist the help of a property manager. The last thing you want to do is be sued for unintentionally discriminating against an interested tenant.

 

3. Tenant Move-In

Property Management Company Handles Tenant Move-in

Here are some of the things your Gaithersburg property management company will handle at the time your new tenant moves into your investment property:

  • Legally compliant lease drafting according to your specific needs
  • Evaluation of local rent rates so your rent will generate income
  • Lease term start and end dates
  • Detailed move-in inspection with all parties, complete with photographs
  • Collection of security deposit and first and last month’s rent

Lastly, your property manager will provide your tenants with the keys to your property, as well as a welcome tenant package, complete with pertinent contact information, maintenance responsibilities, local area information, and possibly a small gift welcoming your tenant to their new home.

 

4. Maintenance, Repairs, and Complaints

Anytime your tenant has a maintenance or repair request, your property management company is the one to handle it.

And, if you choose one of the top property management companies in Gaithersburg, your tenants will have access to an on-call maintenance crew that is available 24/7.

Not having to take after-hours calls from tenants is one of the best benefits of enlisting the help of a team of property managers. Not only do they have the resources to handle emergencies, they take the pressure off of you and having to be available all the time.

It is also a good idea to look into a property management company that has a 24-hour hotline for tenants that have complaints or non-emergency issues. Again, not having to field these calls all night long is something you’ll love.

 

5. Rent Collection

Property Management Company Should Collect Rent

Receiving rent payments, tracking down those that haven’t paid, sending out rent reminders, and disbursing payments to you are another huge responsibility you place in the hands of your property management team.

In addition to collecting your rent money and handing it over to you, your property manager is also tasked with the job of initiating eviction proceedings, should your tenant fail to pay rent on time.

This includes filing paperwork to start an eviction, sending out proper notices, representing you in court, and even aiding in the removal of tenants, should the need arise.

 

6. Property Inspections

Making sure your property is being well cared for throughout the lease term takes a lot of effort.

That’s why having a property manager to conduct seasonal inspections is so helpful. Not only can they check to make sure everything is okay with your tenants (which is a great customer service method), your property manager can make sure your tenant is fulfilling their lease obligations.

Finding small maintenance issues and fixing them before they turn into bigger issues, reminding tenants of their tenant responsibilities, and finding out what would make your tenants happier are all things that will ultimately aid you in your quest for success as a property owner.

 

7. Bookkeeping

Bookkeeping Handled by Property Management Company

Property management companies have a duty to maintain all financial documentation as it relates to your rental property business.

Here are some things your property manager will likely handle while managing your rental:

  • Proper accounting of all rent payments collected, including receipts
  • Annual reporting of all financial statements, including a 1099 form
  • Monthly income/expense reports
  • Documentation of any payments made on your behalf (utilities, HOA, insurance premiums)
  • All maintenance estimates, work orders, and invoice/payment receipts
  • Yearly tax information for the property itself and the rental property business

While it can be helpful to hire on a separate accountant to help you with your yearly financials as they relate to your rental property business, know that an experienced property management company can handle most, if not all, of that documentation for you.

In fact, some property managers will even help you file your annual taxes so that you don’t have to hire external services.

 

8. Tenant Move-Out

Just as your property manager helped move your tenant in, they are responsible for helping your tenant move out as well.

When a tenant gives their notice to move out of your property, you property manager will likely inspect the unit as a whole to determine what damages the tenant has incurred.

From there, the following will happen:

  • Provide tenant with a detailed list of estimated damages
  • Return the remaining balance of your tenant’s security deposit
  • Re-key all locks and make any repairs
  • Clean rental property for next tenant that will move in
  • Place vacant property back on the market

 

This is not meant to be an exhaustive list of Gaithersburg property management responsibilities.

Rather, it gives you a good idea of the scope of tasks a high-quality property manager will gladly take on while managing your rental property.

If you own rental property in Gaithersburg or anywhere in Montgomery County and have realized that self-management of your investment property is not right for you, get in touch with Bay Management Group today.

Top Questions to Ask a Property Management Company in Bethesda, MD

Posted on by Bay Management Group

Top Question to Ask Property Management Company in Bethesda

Deciding to hire a Bethesda property management company can easily become one of the best decisions you ever make for your rental property business.

Why, you ask?

Because, with the right property manager, your investment property will be safe, your tenants will be satisfied, and you will generate the income you seek.

However, there is a lot that goes into hiring a property management company to manage your rental and your tenants.

Today, we are going to dig deep, and take a look at some of the necessary questions you should ask a property management company before hiring them to be responsible for your rental.

 

Questions You Must Ask Every Prospective Property Management Company

1. What Types of Properties Do You Manage?

Finding a property management company that specializes in the type of investment properties you own is crucial to your success.

Most landlords may not be aware that there are four main types of property management companies:

  • Commercial properties include hotels, offices, warehouses, restaurants, and factories.
  • Industrial properties are those that are being used for industrial purposes such as research facilities, manufacturing plants, and warehouses.
  • Retail properties are those that are in the business of selling products and services, such as grocery stores, furniture shops, and boutiques.
  • Residential properties include housing units, condos, apartments, and single and multi-family residences.

You need to hire a property manager with experience in residential rental properties – you will rest easy knowing that your property is being cared for the right way.

[Bay Management Group deals solely in residential and multi-family properties, which are an extension of residential properties.]

 

2. What Type of Leadership is the Company Under?

What Type of Leadership Is The Property Management Company Under

Knowing what type of leader is in charge of running the property management company you are interested in is a good idea.

To start, aim for someone that is still active in the real estate market and who understands current market trends in your property’s region.

In addition, look for someone educated in the field of real estate that has additional real estate certifications supplementing their education.

Since states like Maryland do not require property management companies to have a Broker’s License in order to provide management services, you might want to consider enlisting the help of a company that goes the extra mile, and has a license anyway.

[The President of Bay Management Group takes pride in his experience and education surrounding residential property management. For instance, he studied both Economics and Business in college. Plus, he has over 10 years of experience in real estate, 7 in property management, and is a licensed real estate broker, which again, is not required in the state of Maryland.]

 

3. Do You Provide Any Guarantees?

Whether you are buying a new blender, a new car, an investment property, or are looking to hire one of Bethesda’s top property management companies to manage your rental, you should always look for the guarantee.

Many property managers may make the claim that services simply cannot be guaranteed, thus the reason no guarantee is in place.

And while logistically this may be true to a certain extent, there are some ways of promising customers that the services you provide are indeed guaranteed.

Take, for instance, the service-based pest control company “Bugs” Burger Bug Killers (BBBK). Guaranteeing their customers 100% satisfaction or they won’t take their money forces the company to operate as a no-error service company.

In fact, it places control in the hands of the customers, requires the company to meet or exceed the customers’ expectations, and creates an extremely successful business model.

[At Bay Management Group, you can expect superior customer service at all times. While there is no option to forgo paying the monthly rental property management fees, we do offer a significant guarantee that other property management companies in the region do not.

In addition to competitive management fees, the fact that you never owe for lease renewals, maintenance reserves, supervisory or routine management services, or vacant property fees, Bay Management Group also offers a 12-Month Tenant Warranty. If we place a tenant in your Bethesda rental property, and the tenant is evicted within the first 12 months of tenancy, Bay Management Group re-leases the property for you for free.]

 

4. Do You Have a Website?

Does the Property Management Company Have a Website?

Nowadays people rely on the Internet for nearly everything, and the numbers show no sign of slowing down.

That said, having a website dedicated to property management services is something you want in your property management company.

Here are just some of the things you should look for in your potential property management company’s website:

  • Information concerning their property management services
  • Social proof with satisfied client testimonials and reviews
  • Available properties geared towards high-quality tenant pools
  • Resources directing property owners towards authoritative information
  • A blog with valuable information for existing property owners and tenants, and those that are interested in their services
  • An owner portal for managing rental properties
  • A tenant portal for paying rent and making maintenance and repair requests

[Bay Management Group invests a lot of time and effort into providing property owners and tenants information, resources, and easy-to-use portals via our website. This adds interest, and helps to encourage those on the fence between two top property management companies make a firm decision.]

 

There are always common questions you should ask prospective property management companies. These include:

  • What services are provided?
  • What are the rent collection procedures?
  • What kind of legal backing do you offer in the case of a landlord-dispute?
  • What are the maintenance procedures?

However, looking deeper into a company you are about to hand your investment property over to is a smart move to make.

Feeling comfortable with the company you choose to go with is the only way you will actually be able to leave the day-to-day operations of your rental property business to someone else.

Choosing the most experienced Bethesda property management company, such as Bay Management Group, is a surefire way to feel at peace in knowing your investment property is safe, your tenants are satisfied, and that you will generate the income you seek.

Top Reasons Landlords Use a Property Management Company

Posted on by Bay Management Group

Top Reasons to Choose a Property Management Company

Are you thinking about hiring a Maryland property management company to help you care for your Potomac investment properties?

Many property owners quickly find out that self-managing their rental properties entails a lot more work than they originally anticipated.

This is especially true for those looking to grow their rental property business, expand their portfolio of properties, and come out successful on the other end.

In the past, we have discussed why you should consider opting for a property manager to help you with your investment properties:

  • Save Yourself Time. Managing rental properties, especially if you have another job to hold down, can be overwhelming. Sometimes being physically present at your rental property is impossible, due to other commitments filling your time.
  • Expertise. You may find out after investing in your first Potomac rental that you lack the necessary skills to conduct a profitable rental property business.
  • Willingness. You may find that you are simply unwilling to put the required time into managing every detail necessary for successfully leasing your rental property.

 

These three reasons for hiring a property manager are definitive. In fact, the majority of property owners fall under at least one of these three categories.

However, there are more reasons why a property owner might want to utilize the services of a property management company.

And, it just so happens that our Potomac property managers are privy to this knowledge, and want to share it with you.

 

Reasons to Enlist the Help of a Potomac Property Management Company

1. You Do Not Live Nearby

Enlist Help From a Property Management Company Because You Don't Live Nearby

Landlords that do not live nearby their rental properties will have a tough time managing the day-to-day operations investment properties require.

This is where a property management company in close proximity to your rental comes in handy.

Not only can they handle daily things with your property, in the case of an emergency, they can be at your property right away. This is helpful to you, and satisfying to your tenants.

 

2. Vendor Relationships

Knowing someone that is highly qualified, affordable, timely, and customer-service oriented is valuable.

That’s why having the help of a property manager is beneficial to you as a landlord.

Successful property management companies have built strong relationships with vendors of all kinds throughout the years – maintenance workers (if they do not have their own crew), contractors, suppliers, tradesmen, and vendors.

Your property manager’s connections will garner you the best work in town, and save you money in the long run.

 

3. Customer Service

Hire a Property Management Company for Customer Service

Knowing how to keep your tenants happy, and willing to sign lease renewals come the end of their lease term, may seem easy.

Unfortunately, many landlords do not possess the customer-service skills tenants expect from their landlord.

This can break down a healthy landlord-tenant relationship over time, which ultimately leads to a vacant property come the end of the lease term.

However, by using a customer-service oriented property management team in Potomac, you will reap the benefits of their ability to satisfy your tenants.

Whether it be with the tenant package they provide new tenants, their quick turnaround times when it comes to maintenance and repairs issues, or simply the convenience that online rent collection provides busy tenants, a good property management company will be able to take care of your tenant’s every need.

 

4. Help Expanding

Property management companies are well versed in the real estate market trends that span the regions they work in.

This means that for those looking to expand their portfolios across regions, the insight of a property manager that is already managing one or more of their properties can be very helpful.

If you are looking to cross city or state lines in hopes of investing in some valuable rental property, an already established relationship with a property management company will be useful for gaining knowledge about new markets.

Plus, you can have them take over the management of your new properties, making the transition to other areas even easier.

 

5. Setting Rental Rates

Hire Property Management Company to Set Rent Rates

In tune with knowing the status of the current rental property market, a qualified property management team will also understand what the going rent rates are.

They will be able to help you determine the right rent rate for your properties, depending on things such as location, amenities, and going rates for similar properties.

This will prevent you from both undercharging and failing to maximize your monthly rental income, and overcharging, which can lead to longer vacancy periods.

In addition, a good property manager will be able to help you decide when a good time to raise your current rent rates is, and by how much.

 

6. Compliance with the Law

Ignorance of the rules and regulations, as they relate to Potomac rental properties, is no excuse when it comes to owning investment properties.

Here are some of the important legal concerns an experienced Potomac property management company can help you with:

  • Fair Housing regulations
  • Lead and mold inspections/disclosures
  • Smoke and carbon monoxide detector requirements
  • Housing and building codes
  • Proper notices
  • Eviction procedures

Don’t get caught up in landlord-tenant disputes, or worse, legal battles that can ruin your rental property business.

Hire a property management company to help ensure you are always in line with federal, state, and local laws as they apply to your rental property.

 

There are plenty of solid reasons for investing in a property management company in Potomac.

By choosing a competitive property management team, such as Bay Management Group, not only will you reap the benefits of their services, you will maximize your profitability and boost your success as a property owner.

If you are in need of an experienced, highly qualified, and customer-service oriented property management company in the Potomac area, get in touch with Bay Management Group now. We can help you find the best tenants, minimize risks associated with investment property ownership, and ensure that your rental property business continues to grow.

Top Tips for Avoiding Rental Property Scams in Chevy Chase, MD

Posted on by Bay Management Group

Tips for Avoiding Rental Property Scams in Montgomery County

Rental scams have been around for decades. And, as the number of people looking to rent increases nationwide, more tenants than ever are on the lookout for these scams, so they don’t fall victim them.

Criminals that are responsible for these scams are aware of the heightened demand for rentals, and the increasing rent rates that property owners can demand, and they want in on whatever they can get.

However, when all is said and done, rental scams affect not only tenants, but property owners as well.

Though rental scams are not something many Chevy Chase property owners probably think about, they should definitely be on your radar. Learning about the different types of rental scams out there may help you prevent getting mixed up in a rental scam of your own.

 

What is a Rental Scam?

In short, a rental scam is a situation where a scammer attempts to secure funds from an interested tenant for a rental property that is not legally their own to rent.

The rental property in question may be physically real and just not theirs, or completely made up and non-existent.

Typically, a scammer will advertise a rental as available, hook a potential tenant by collecting application fees and security deposits, and at the time of move-in, simply disappear with money in hand.

By the time the prospective tenant realizes what has happened, the scammer is long gone and untraceable.

However, rental scams have evolved over time, and have become more complex than simply swindling prospective tenants out of their money.

 

Rental Scams That Can Involve Your Chevy Chase Rental Property

Here is the breakdown of three of the most common rental scams that happen today. Most people are generally very trusting, thus making these seemingly obvious scams extremely effective.

Keep reading to learn about the various ways a scammer may try to take advantage of you, the property owner.

 

1. Online Advertisements

Online Advertisements Are Risky For Rental Property Scams

Advertising your vacant rental online is one of the best ways to expose your vacancy to a wide tenant pool. Plus, it doesn’t take a great deal of effort or money to advertise online.

However, online advertisements are one of the easiest ways for people to scam your Chevy Chase rental property. All someone has to do is cut and paste your real online ad, and then lower the asking rent price.

This generates a lot of interest amongst interested tenants, especially those in a hurry to pay whatever fees are required to move in right away.

The scammer then gathers several application fees, security deposits, and whatever other fees he can get from multiple potential tenants, and runs away with all of that cash before anyone is the wiser.

This will affect you because if people find out your property has been involved in a shady scam such as this, the real advertisement displaying your property as available will not go over well with interested tenants.

This can ultimately ruin your reputation as a good property owner, and take your rental property business down.

 

2. The Fake Landlord

If, by chance, a scammer can access your vacant property, you are in a lot of trouble. The way this particular scam works is a fraudulent landlord pretends to be working on behalf of you, the real landlord, and sets out to get your property leased.

If you have not done your due diligence in routinely inspecting, securing, or making it seem as though your vacant property is occupied, the scammer might even show the property as though they are the actual landlord.

From there, a prospective tenant then decides they like your place, pays the required security deposits, first and last month’s rents, and application fees.

Then, one of two things happens:

  1. The scammer takes off with all of the collected funds, and the tenant never hears from him again.
  2. The tenant actually moves in to your property, and the scammer collects rent from them for as long as possible before being discovered. The scammer then disappears into thin air, leaving you with a property that has tenants living in it illegally, unbeknownst to you this entire time.

This creates a mess of legal problems that is going to cost everyone, save for the scammer, a lot of time and money.

 

3. Accepting Overpayments

As a Chevy Chase rental property owner, you should know that accepting overpayments for fees or rent from an approved tenant is never a good idea.

Typically, when this scam happens, your “tenant” overpays, and asks you to forward the extra money to a close friend or family member. They will have some well thought-out excuse as to why they cannot do it themselves, and oftentimes can be very convincing.

Unfortunately, what happens in this scam is that you send the extra payment to someone else, and then find out the check you received was actually bogus.

But by now, it’s too late for you to recover the funds you already sent out to your tenant’s sick grandma. You are now on the hook for that missing money.

Although this usually will not happen with tenants that you have already leased your rental to, the truth is, this happens a lot when it comes to security deposits at the beginning of a lease term.

And, it is not uncommon to see this happen with tenants that are out of town looking to lease your rental.

One surefire way to help avoid these types of issues with current tenants is to accept rent payments via a secure online portal. This way, when you receive rent payments, regardless of whether it is an overpayment or not, you will know the funds are legitimate once they hit your bank account.

 

Landlords Tips for Avoiding Rental Scams

Though most rental scams are aimed at getting money from tenants looking to rent a home, it is important, as a Chevy Chase property owner, to protect your investment property in any way you can.

Here are some ways you can protect yourself:

  • Always perform routine inspections of your rental, especially when it is vacant
  • Make sure to change the locks in between tenants, so previous tenants don’t have access to your property after they have moved out
  • Thoroughly screen all tenants before placement into your rental – income verification, clean backgrounds, and reliable rental history are all important
  • Check popular online advertisement listings regularly to make sure your rental is not fraudulently being listed as available
  • Avoid dealing with prospective tenants who contact you from outside of the country, or at least be careful if you choose to
  • Never rush a tenant placement – this is when scams are most likely to occur

 

Lastly, one of the best things you can do to protect yourself from being scammed, or having a rental property mixed up in a scam outside of your knowledge, is to enlist the help of a Chevy Chase property management company such as Bay Management Group.

At Bay Management Group, we pride ourselves in taking every precaution to protect our rental property owners and their investment properties.

This means we do things like perform strict tenant screening, airtight lease drafting, routine inspections, and online rent collection. In addition, we help our clients keep their properties secure using a variety of security measures.

If you own rental property in the Chevy Chase region, contact Bay Management Group today and see how we can help you avoid getting caught up in a rental property scam.

How to Be a Next-Door Landlord in Montgomery County

Posted on by Bay Management Group

How to Be A Next-Door Landlord in Montgomery County

You have been stewing over whether you should add another Montgomery County rental property to your growing portfolio.

And, like all successful landlords, you have done your due diligence and researched all the right things – market trends, going rental rates, amenities, financing options, as well as nearby shopping, dining, and entertainment venues.

There’s just one catch.

The rental property you want to invest in is right next door to your primary residence.

Though being a next-door landlord has many benefits, it has its fair share of drawbacks as well.

Read on to find out what the pros and cons are of living right next door to your Montgomery County tenants, and how to find success in being a next-door landlord.

 

The Benefits of Being a Next-Door Landlord

1. You Can Create a Stronger Landlord-Tenant Relationship

Living next door to your tenant is often a great way to build a better, and healthier, relationship.

In many cases, tenants have very little to no contact with their landlords.

This means they never get to know the property owner on a personal level.

Having a friendly relationship with your tenants, that still maintains strong boundaries (after all, this is a business you are running), can forge the distance that often exists between landlord and tenant.

As a result, you may be able to win over your tenant, and increase your lease renewal rates because your tenant enjoys being in your company from time-to-time.

 

2. Quicker Response Times

Next-Door Landlords Have Quicker Response Time In Montgomery County

Property maintenance can be a real pain if you self-manage your rental property, and live far across town.

No one wants to get an after-hours call that a pipe burst and the property is flooding.

However, if you don’t have a property management company on your side to help you out with 24/7 maintenance, an after-hours call is exactly what you will receive.

Living next-door and receiving a midnight call that your rental property is flooding because of a burst pipe is still going to be a pain.

However, it will be a lot easier to pop on over from next door and handle the issue at hand.

The same rings true for minor, non-emergency maintenance requests.

If your tenants have something they need, a quick visit from you next door will be far less strenuous than having to make an out of the way trip from across town.

 

3. Tenants Will Behave

If your Montgomery County tenant knows that you live right next door to them, chances are they will be on their best behavior at all times.

While we do not suggest you spy on them (this is not recommended for many reasons), tenants tend to behave better when they know their landlord is around.

Also, breaking the lease agreement will be more difficult for tenants to pull off knowing that you may notice this breach at any moment.

In addition, sneaking a pet into the property knowing there is a no-pet policy will be hard to do.

Damaging the property when you can likely easily see it will be nearly impossible.

And, tenants can forget about having constant parties that wake the entire neighborhood, because that neighborhood includes you.

 

4. Property Abandonment is Less Likely

Abandoned Property Is Less Likely to Happen With a Next-Door Landlord

In tune with better tenant behavior, another benefit to living right next door to your tenants is the fact that property abandonment is not likely to go unnoticed.

One of the biggest issues facing property owners is the non-payment of rent.

This is especially true if a tenant packs their bags in the middle of the night, and simply disappears without a trace.

Recouping lost rent payments, dealing with abandoned personal property, and having to start all over and place new tenants in their rental, are all things property owners hope to avoid at all costs.

If your tenants decide they want to leave your rental without proper notice, they are going to have to be sneaky to get away with it without you noticing.

In fact, if anything suspicious is going on next door, you are probably going to be the first to notice.

 

Problems Facing Next-Door Landlords

1. Tenant Screening

Just because you will be living next door to your tenant does not mean you can take any additional liberties when it comes to tenant screening.

You must remain consistent in your tenant screening procedures, and take care not to violate the Fair Housing Act.

While it is okay to want to place high-quality tenants in your property, make sure not to treat next-door tenants any differently than you would other prospective tenants for properties across town.

Do not ask unusual questions or discriminate against any protected classes because you want a particular type of tenant living next door.

In order to protect yourself against any claims of discrimination, enlist the help of an experienced Montgomery County property manager to help aid you with the tenant screening and placement process.

 

2. Boundaries Might Blur

Boundaries Can Blur As a Next-Door Landlord in Montgomery County

It can be difficult to find the balance between being a friendly neighbor, and maintaining your status as property owner.

While living next door to your tenant, make sure to set clear boundaries from the start.

This means establishing clear and appropriate lines of communication.

For instance, ensure your tenants that you will be available for all questions and concerns, including emergencies, but that knocking on your front door at random times is not allowed.

You want to make sure that you appear as a kind and understanding landlord that is dedicated to providing your tenants the best living experience possible.

However, you also want to make sure tenants understand that you are the boss, that there is a legal lease agreement in place, and that violations of the rules will not be tolerated.

 

How to Be a Good Next-Door Landlord

Here are a few things you can do to make sure you are a good next-door landlord:

  • Remain Professional. Always remember that this is your rental property business and that business comes first. It is okay to be friendly. It is not okay to let your guard down, and let your tenants get away with violating the lease because you are on friendly terms.
  • Screen Tenants Thoroughly. Following strict tenant screening procedures, without violating the Fair Housing Act, will ensure that your investment property, and your sanity, remain intact while your tenants live next door to you for the duration of the lease term.
  • Understand the Law. As a property owner, it is your duty to understand that tenants have the renter’s “Right of Quiet Enjoyment” while residing in your property. This means your tenants have the right to be left alone and not bothered by you on a regular basis, despite you living right next door. This means you cannot harass them as they go to and from the property, spy on them, access the property illegally, or otherwise violate their rights.
  • Be a Good Neighbor. You don’t want your tenants throwing loud parties, trashing the front yard, involving themselves with illegal activity, or bothering other neighbors. The same applies to you. Being a decent neighbor, is something your tenants will expect from you as well.

 

In the end, there are many reasons why becoming a next-door landlord in Montgomery County is a good idea.

Being able to see your investment property on a consistent basis is bound to lessen some of the typical problems landlords face with problem tenants.

However, it is important to remember that your tenants may initially be uneasy at the thought of living next door to their landlord.

Go out of your way to show tenants you are professional, and want them to enjoy your property. If you can do this, they will be more likely to sign a lease renewal come the end of their lease term.

 

If you need help managing your next-door rental property, and prefer to not deal with the logistics of collecting rent, hopping over to fix leaky faucets, or enforcing the no-pet rule when your tenant clearly has a large dog in the backyard, contact Bay Management Group to help.

At Bay Management Group, we provide property owners with a whole host of property management services for a low monthly management fee.

Enjoy the benefits of having a qualified property maintenance crew on hand 24/7, and our ability to inspect properties throughout the lease term to ensure adherence to the lease agreement.

In addition, take advantage of our strict rent collection policy that will not require you to run around collecting rent checks.

At Bay Management Group, we make management of your Montgomery County rental property hands-off, allowing you to feel stress-free about your next-door tenants.

5 Tips on How to Decide Your Montgomery County Rental Price

Posted on by Bay Management Group

Tips on How to Decide the Price of Your Montgomery County Rental Property

You want to make a profit with your rental property.

You want to be competitive.

You want to entice tenants that you are the best.

You want to be known for having an outstanding rental property.

There is much to balance when it comes to setting the monthly rent amount for your Potomac rental property, and it can be exhausting, to say the least.

If you price it too high, your vacancy rates skyrocket.

If you price it too low, you risk losing money.

So how do you go about deciding what the perfect rental price is for your valuable Montgomery County rental property?

Finding the rental price sweet spot can be challenging if you are not sure how to go about deciding on a firm amount.

And, since you have a mortgage, taxes, insurance, and repairs to pay for, not to mention the fact that you are in the rental property business to make a profit, understanding how to set your rental property’s monthly rent rates is crucial to your success as a property owner. 

Luckily, today we are sharing 5 exceptional tips to help you set your property’s rental price.

 

How to Determine Your Potomac Rental Property Price

1. Evaluate Your Property’s Amenities

Evaluate Your Property's Amenities to Determine the Rental Price in Montgomery County

You should always set your rental property’s monthly rent rate based on how desirable it is to tenants looking for a property similar to what you own.

If you base your prices on generic characteristics such as how many bedrooms the property has, or whether it has 2 or 3 bathrooms, you are likely to come up short when it comes to positive cash flow.

Instead, evaluate your property based on things such as:

  • Updates and Improvements. Appliances, flooring, landscaping, and other amenities are highly desirable amongst prospective tenants.
  • Is it one or two stories? Does it have an elongated layout, or is it more mix-and-match with varying levels? Describing your property’s layout in detail will garner more interest from interested tenants.
  • Storage Space. People love extra closets, built-in organizers, and garage space. Highlight these things, and as a result, ask for more rent thanks to these amenities.
  • Square Footage. The more square footage your property has, the better.

In addition, you can take into account things such as included utilities, safe neighborhoods, nearby public transportation, separate or private entrances, off-street or garage parking, and even the fact that your unit is on the first floor, which can be more desirable in some places.

Depending on your property’s amenities, you will be able to determine whether you can charge more per month for rent than a neighboring property that is of a similar style and layout.

 

2. Do the Math

Many Montgomery County property managers suggest, calculating 1.1 percent of your property’s value to determine a super simple starting point.

In addition, for those with expensive properties, staying closer to 0.8% of the purchase price is common when determining a rent price.

 

Utilize Square Footage

If you want to take it one step further, calculate how much neighboring properties are going for based on their square footage, and then do the same for your property.

To do this, simply divide the monthly rental price by the square footage of the property.

Just keep in mind that smaller properties typically rent for more per square foot than larger properties.

And remember, these calculations are simply starting points for determining rent rates.

They do not take into account things such as amenities, competition, market rates, location, employment rates, and more.

 

3. Research Your Competition

Research Your Competition to Determine the Rental Price of Your Montgomery County Property

Look at where your property is located and measure it up against others in the surrounding area.

How does yours compare?

In the end, competition will affect how much you can ask for each month in rent.

Here are some things to consider:

  • Check online ads and newspapers to see what similar properties in your area are going for
  • Notice excessive incentives, and make note of the oversaturation in your area
  • Ask local realtors or other landlords you can trust what you think is a fair rent amount
  • Compare your property’s amenities to similar properties, and either add or subtract from your starting monthly rent based on your findings
  • Ask around for vacancy rates of similar properties, and adjust your rent price accordingly
  • Check out useful tools such as this calculator from Zillow to give you an idea of going rent rates in your area

It is best to have a starting point and then work your way up or down, depending on the factors mentioned above.

The more demand you can create for your property, the more rent you can command from tenants.

The key is finding what makes your property better than the others, and advertising that to potential tenants.

 

4. Determine Your Profit Margin

Property owners seek to maximize on their rentals in terms of profit.

After all, that’s why people get into the rental property business.

However, everyone’s idea of profit is different.

Thus, it’s important to decide your base profit margin, and work your way up from there.

Don’t know what your base profit margin is?

Start with this:

  • Monthly mortgage amount
  • Maintenance and repair costs
  • Insurance costs
  • Taxes

At minimum, the monthly rent you charge your Potomac tenants should cover these costs.

If not, you could easily find yourself dipping into your own pocket to cover the costs, and eventually end up in a financial crisis.

In addition to covering these costs, it is a good idea to calculate that you want to profit approximately 6-8% of the monthly rent amount each month.

This is a reasonable expectation, and should not hinder most tenants from wanting to lease from you.

 

5. Enlist the Help of a Property Management Company

Enlist the Help of a Property Management Company to Determine The Rental Price of Your Montgomery County Rental

If you have tried to make the best of all of the above-mentioned tips, and still feel like you are not sure what to set your Montgomery County rental property’s rental price at, get in touch with Maryland’s best property management company, Bay Management Group, and let us help you.

Dealing solely in the management of rental properties, Bay Management Group offers property owners all the help they could need when it comes to leasing a vacant property:

  • Aggressive marketing of vacant properties across multiple channels – major search engines, online classifieds, direct mail, and other helpful online sites
  • Advanced advertisement of vacant properties, highlighting every unique detail and commanding the highest rent possible
  • Complete tenant screening and lease drafting services

And this is just the beginning.

The staff at Bay Management Group understands what it takes to lease properties for a profit, and will help you to do just that by hitting the market hard, finding only the best tenants that are willing to pay for a property worth a high rent, and keeping them there long-term.

If are looking for the best when it comes to property management, contact Bay Management Group today.