Top 7 Ways to Guarantee Success in Your First Investment Property

Ways to Guarantee Success in Your First Investment Property

Investing in rental property is a great way to boost supplemental income, or even replace your traditional 9-5 day job.

In fact, getting into the rental property business can be extremely lucrative, if approached the right way.

However, it’s important to note that many first-time investors can mistakenly get caught up in the excitement of buying a rental property – and this excitement can easily get in the way of making sound financial and business decisions.

Taking the step from the decision to invest in Abingdon rental property to actually doing it is a big one that warrants a lot of thought.

It comes with risks that you may not be aware of – ones that have the potential to affect the success of your rental property business for years to come. This is a decision to take very seriously.

If you want to avoid major mistakes when you set out to invest in your first piece of rental property, read on to find some helpful tips that are designed to guide new investors in the right direction, right from the start.

 

Helpful Tips for Investing in Your First Rental Property

1. Have a Plan

Before you jump into investing in your first rental property, you should take the time to devise a solid plan of action.

This will help prevent many unexpected issues that tend to pop up during the purchasing process.

Here are some things experienced property management companies suggest:

  • Pay Down Your Debt. Paying down your existing debt does more than help you qualify for a loan. It also creates a buffer once you own the rental property for things such as emergency maintenance issues, unexpected vacancies, and times when your tenant fails to pay rent.
  • Create a Budget. This is something any experienced property owner will tell you. Making a strict budget, before you invest in a rental property, will prevent you from getting in over your head. Factor in purchase price, maintenance and renovations, an emergency fund, and the cost of placing a tenant in your property.
  • Save for a Down Payment. Even if you have purchased a home in the past, it is important to realize that investing in rental property is much different. You will typically need at least 20% when it comes to a down payment, because there is no PMI available to protect the banks in case you default on the loan.
  • Watch the Market. Knowing when to invest is almost as important as having enough money to invest. You should take care to watch the market and see what interest rates are doing at the time you want to invest. Remember, investment property loans will usually have higher interest rates than traditional homes, which can kill your bottom line, even if you warrant high rent rates from quality tenants.

Making a plan before you get into the excitement of purchasing a rental property will help keep you on track during the investment process.

 

2. Take Your Time Choosing an Investment Property

Take Your Time Choosing an Investment Property

Again, closing on your first investment property is an exciting time that can cloud your judgement if you are not careful.

Avoid buyer’s remorse by taking your time to find the rental that will work best for your pre-defined budget. Check out any property you are interested in buying before entertaining any negotiations, and don’t take the previous homeowner or real estate agent’s word for it.

Ensure that the property has all the amenities you wish to offer to your tenants. Find out what makes this property stand out from others in the area that are being leased, and take note of all the things you may need to renovate before placing a tenant to make sure it fits into your overall budget.

In any business deal, jumping in too soon harbors room for problems that can have lasting effects on your rental property business.

Give yourself time to find the right one; it will be worth it in the long run.

 

3. Avoid Fixer Uppers

In the past, we have discussed how investing in a fixer-upper rental property can be a good idea. However, for those that are new to investing in real estate, this may not always be the best idea.

A great purchase deal on the surface often indicates that there is a lot of work needing to be done after you purchase the property in order to make it rent ready.

And, unless you have budgeted this into your overall plan, and are handy when it comes to repairs, chances are a fixer upper is not what you are looking for in your first investment property.

 

4. Choose a Reliable Real Estate Agent

Choose a Reliable Real Estate Agent For Your First Investment Property

The real estate agent you choose to help you with your property purchase can make or break your longtime success.

To avoid getting mixed up with a less-than-stellar real estate agent, take note of these helpful tips:

  • Don’t get caught up in negotiations with other interested buyers if the purchase price or other details begin to extend beyond what you originally planned for
  • Choose an agent that you trust, that has a reliable reputation, is patient and understands your needs, and is communicative throughout the process
  • Never let an agent rush your purchase decision, even if that means you lose out on a deal
  • Try to get referrals from those close to you that have had success with a real estate agent in the past

If at any time you begin to feel your agent is not being helpful, simply walk away and get a new one.

 

5. Decrease Expenses

Being successful with your first investment property does not stop after you finalize your purchase.

In fact, closing on a property is only the beginning.

From the start, think of ways you can decease expenses and boost your positive cash flow once you place tenants in your property.

For example:

  • Make sure all utilities are the tenant’s responsibility
  • Build extra costs, such as HOA fees, into the rent rate if you can
  • Shop around for homeowners insurance, and require your tenants to get renters insurance
  • Make your rental eco-friendly, especially when it comes to major appliances
  • Challenge your property taxes if you feel they are too high
  • Interview property managers to make sure you are getting the best deal for the services they offer

These small considerations have the potential to save you a lot of money as you lease your rental property, and are easy for new investors to handle.

 

6. Learn the Laws

Learn The Laws For Your First Investment Property

Whether you self-manage your rental or employ Abingdon’s best property management team, it is ultimately your responsibility to know and understand the federal, state, and local laws surrounding the landlord-tenant relationship.

Even if something illegal happens under the care of your property manager, you could find yourself in a lot of hot water.

Court fees and fines, a ding on your reputation as a property owner, and the loss of your property if your bottom line is damaged enough, can all result from not knowing the laws.

Educate yourself so that you know how to properly handle any legal situation that comes your way. And, if you have a knowledgeable property management company backing you, think of that as an added bonus.

7. Consider Hiring an Abingdon Property Manager

Getting into real estate and leasing your first investment property can be daunting at first.

You may not know what to do after you have purchased your property, or maybe you are not keen on the idea of self-managing your rental.

No matter the case, the solution resides in hiring a trusted property manager to help you out with everything from advertising your available property to tenant placement; tenant complaints to the lease renewal process.

If you are looking to invest in your first rental property in Abingdon, consider getting in touch with Bay Management Group from day one. With years of experience in the rental property industry, Bay Management Group has the staff on hand to answer all of your questions about being a successful rental property owner.

This way, once you invest in your first rental property, you will already have a qualified property manager in Abingdon ready to help you with setting rent rates, conducting inspections, providing 24/7 maintenance and repair services, and more.


5 Avoidable Mistakes Landlords Make with Rental Agreements

Landlord Mistakes to Avoid in Your Rental Property Lease Agreement

Though having one universal lease agreement satisfying every type of lease term possible would be great, in reality, every lease is different.

And, while using a universal lease form is possible, it is important to note that whether you self-manage your Dundalk rental property, or enlist the help of a property management company, there are going to be specifics that you need to address while drafting your property’s lease agreement.

As a landlord, there are many things to think about while filling a vacant rental.

To name a few, you must consider: advertising the property as available, performing the tenant screening process, conducting move-in inspections, and of course drafting the lease agreement.

Unfortunately, with all of the things you need to tend to, and the desire to rush the process of filling a vacant rental property, some landlords make dire mistakes in their rental agreements that can wreak havoc on their rental property business.

Don’t let these common mistakes plague your rental agreement while trying to quickly place someone in your vacant property.

Instead, learn from these mistakes (that others before you have made), and find out what makes a lease agreement one that protects you, your investment property, and your tenants.

 

Avoid These Mistakes While Drafting Your Lease Agreements

1. Not Properly Identifying the Tenants

Although this may seem obvious, you would be surprised how many landlords fail to address their tenants correctly in their lease agreements.

Remember, a rental agreement is a legal document, and should refer to your tenants by their full legal names.

No nicknames, shortened names, or names other than what are listed on driver’s licenses or identification cards should be allowed in the lease agreement.

In addition, you should have your tenants names located somewhere in the beginning of the document (typically in the first paragraph), as well as at the end of the document where the signature blocks are placed.

If you fail to name your tenants correctly on the lease agreement, you may find it difficult to enforce your lease agreement.

This is especially true if you land in court due to a landlord-tenant dispute.

If your tenants make claims that the people listed are not really them, you are going to have a hard time winning your case.

 

2. Not Researching Rent Rates

Research Rent Rates for Your Dundalk Rental Property

One of the key elements in a lease agreement is the monthly rent rate that your tenants are responsible for paying each month.

Failing to research the market rent rates properly and instead placing a random rent rate in your lease agreement will is something you want to avoid.

This mistake may cause you to over- or underprice your rental property.

If you overprice your rental, your tenant pool will shrink sizably, and any tenants that you have currently residing in your property are not likely to renew if you continue to raise the rate sporadically.

On the other hand, underpricing your rental property will harm your bottom line.

A great way to ensure you name the right rent rate in your lease agreement is to talk to your Dundalk property manager.

They will have insight into things such as current market trends, demographics of the area your property is located in, and the rates that similar properties are going for so you remain competitive.

Lastly, in order to avoid another mistake some landlords make, you should re-evaluate your rent rates every time you place a new tenant in your property to make sure to keep in line with current trends.

 

3. Not Personalizing the Agreement

Universal lease agreement forms don’t come with every lease provision you can think of. That’s why simply filling in the blanks is a bad idea, and is one that your Dundalk property management company will discourage.

Now is the time for you to be specific about the rules as they pertain to your rental property.

Take a look at some of the specific clauses you might want to include in your rental agreement:

  • Whether your tenants can smoke in the property
  • What type of interior alterations (temporary or permanent) tenants can make
  • If your tenants can have pets, and if so, which type, how many, what size, and what the deposits will be
  • Which maintenance responsibilities your tenants will be responsible for

 

All of this lease agreement personalization will ensure your tenants know exactly what is (and isn’t) expected of them while residing in your property. It will also outline the consequences for not following your rules.

However, as important as personalizing your lease agreement is, make sure you follow your state’s rental property laws.

For example, make sure you don’t overcharge on the security deposits and fees.

In addition, don’t ask your tenants to violate their tenant rights, such as forfeiting the notice of entry, so that you can do as you please.

Avoid these mistakes at all costs, as they will land you in some serious legal trouble.

 

4. Not Addressing Late Rent

Address Late Rent in Your Dundalk Rental Property

Earlier we mentioned the importance of setting an appropriate rent rate and placing it in your lease agreement.

That said, it is equally important to mention what will happen should the rent not get paid on time.

Failing to detail the consequences for late or non-payment of rent is a huge mistake.

This not only sets you up for continuous late payments, it makes it very difficult for you to receive compensation in court for non-payment of rent, should your tenant stop paying altogether.

Make sure to include the rent rate, grace period, late fees, and eviction process for non-payment of rent in your lease agreement, so that should you run into an issue with a tenant, you have the legal document backing you up that states both parties agreed to the terms and your tenant owes you money.

Late payment lease provisions are used to inform and motivate your tenants to pay their rent on time.

After all, you rely on their timely payment and often cannot afford to wait for them to pay when it is convenient for them.

In addition, this section not only protects you in the case of non-payment, it protects your tenants from illegal eviction proceedings.

 

5. Not Setting a Lease Term

In your rental agreement, it is crucial you designate a lease start and end date.

This way your tenant knows exactly when they can move in, and when they have to be out of your property, should they choose not to renew their lease with you.

In addition, there are some lease renewal options that some see as mistakes, that you and your Dundalk property manager should carefully consider while drafting a lease agreement:

  • Allowing for automatic lease renewals (how can you be sure you will want your tenants to renew one year from now?)
  • Including a month-to-month renewal option (both parties have the option to break a month-to-month lease with 30 days’ notice, leaving you little time to find new tenants)
  • Not requiring a 60 days’ notice of intent when it comes to renewals (leaving it to the last minute might leave you with no time to fill a vacancy, should your tenants decline your offer)

 

The Importance of an Airtight Lease Agreement in Dundalk

Altogether, none of these options are necessarily dire mistakes. However, they may cause you extra stress that can be avoided with a well thought out and thorough lease agreement.

Having an airtight lease agreement that addresses all of your concerns is important for everyone involved.

After all, the lease agreement is the document that both you and your tenants will refer to when there is an issue.

Therefore, the more thorough it is, the less confusion you and your tenants are bound to encounter.

If you own rental property in the Dundalk region, and want help drafting a comprehensive and legally compliant lease agreement, contact Bay Management Group today.

With years of experience drafting lease agreements for property owners, and extensive knowledge of the landlord-tenant laws, you can rest assured that every provision you want included will be integrated into each rental agreement so they you, your investment property, and your tenants are fully protected.


The Top 5 Ways to Collect Rent From Your Bowie Tenants

Top 5 Ways to Collect Rent From Your Bowie Tenant

Collecting rent from your tenants in Bowie, MD is one of the most important tasks assigned to your property management company.

After all, once rent is collected from your tenants, you get paid.

Today, we are going to look at some of the steps required to collect rent from your tenants, as well as some ways to go about collecting rent.

But first, we will review the more traditional ways of collecting rent, for a quick refresher.

 

How to Collect Rent From your Tenants

How to Collect Rent From Your Bowie Tenant

Here is a look at some of the best ways to collect rent from your tenants:

  1. Online. Allowing tenants to access an online portal to pay their monthly rent is typically considered the best way. It is convenient for your tenant, is secure, and it guarantees that the funds submitted are going to be deposited into your bank account.
  2. Check or Money Order. Though some Bowie property managers prefer not to accept personal checks (unless mailed in), a large majority of tenants still prefer to pay with paper checks. If you do not accept paper checks, money orders are a safe and simple alternative.
  3. Direct Deposit. There may be instances where you want your tenant to transfer their rent from their bank account directly into your bank account. Though not very common, it is definitely secure.
  4. Mail-in Payments. You can always go the more traditional route, and allow your tenants to mail their rent to either you or your property management company. However, the risk of your tenant’s check getting lost in the mail exists, and can cause a delay in your getting paid.
  5. In Person. There is also the option of having your tenants drop their rent off in person at your house (which is always risky) or at your property management company’s office. Again, this requires a personal check, a money order, or cash (which is never recommended).

 

As you can see, there are a number of ways to collect rent from your tenants.

But the question still remains: what are the steps to collecting rent from your tenants?

 

The Rent Collection Process

Rent Collection Process in Bowie, Maryland

The process of collecting rent from your tenants is rather simple if you employ Bowie’s top property management company to do it for you.

Here is a rundown of how your property manager should approach collecting rent from your tenants:

  1. Draft an airtight lease agreement outlining the rent rate, due date, and consequences for paying late
  2. Inform the tenant prior to move-in of the rent collection procedures, including the methods for submitting payment
  3. Collect rent each month through the approved methods
  4. Properly document all rent payments collected each month for tenants, property owners, and the IRS to see
  5. If a rent payment is late, begin the eviction process immediately – serve proper notice, file eviction paperwork, and prepare for legal proceedings if necessary

 

Although the process for collecting rent from your tenants is relatively simple, it is critical to not underestimate its importance.

This is especially true when it comes to dealing with late rent payments.

If, by chance, your tenants fail to pay their rent on time, your property management company should step in and handle the situation right away. You should not let your tenants feel that they can get away with paying their rent late.

After all, this is your rental property business, and you should treat it as such.

 

Additional Rent Collection Methods

Pay Rent Online Via ACH

There are several ways you can collect rent from your tenants during the course of their tenancy.

And, while some ways are recommended, such as collecting payments online, there are additional options that you can provide your tenants, if the situation arises.

 

Local Drop Box

This method is similar to allowing your tenants to drop their rent payments off in person to your property management company. However, this method affords both your property manager and tenant some convenience when it comes to the actual time of day that the payment is dropped off.

Rather than hand in a rent payment in person during regular business hours, having a drop box available makes dropping off rent at any time of the day possible.

Many of your tenants may work during the day and may need to drop rent off after-hours. Allowing them this option of a drop box may reduce late or delayed payments.

 

ACH Payments

ACH stands for Automated Clearing House, and involves the automatic collection of rent payments online.

Using an ACH payment service allows you to collect payments from your tenants electronically either as one-time payments, or as recurring payments by directly debiting your tenant’s savings or checking account.

This method is secure and prevents your tenants from having to use e-checks or credit/debit cards.

In addition, this method can be more cost effective than collecting payments via credit or debit card.

Why is that?

Because accepting credit and debit cards usually involves additional transaction fees in exchange for using the online rent collection service.

Lastly, collecting rent using the ACH payment method is typically faster than any online method, because payment is directly debited from your tenant’s bank account.

Processing this type of transaction is quick and easy.

 

PayNearMe

If your tenant does not have access to a computer, or prefers to pay in person but your property management company does not accept drop-off rent payments or does not have a drop box available, you can always consider offering them a PayNearMe option.

PayNearMe is a way to let your tenants pay their rent in cash to a local 7-Eleven or other business that collaborates with the PayNearMe program.

Using a unique card assigned to them for making rent payments, your tenant simply goes to the local PayNearMe business, pays their rent at the counter, and receives a receipt for payment. In response, you are immediately notified that your tenant has paid their rent in full.

This option is often much easier than getting a money order and delivering it, or mailing a check (complete with envelope, address, and stamp), and is a great solution for those that do not have online payment access.

 

Collecting rent from your tenants is one of the most important things you will do as a property owner.

And, if you enlist the help of Bowie’s best property management company, you will be placing the responsibility of rent collection in your property manager’s hands, which is a big weight off of your back.

If you own rental property and need a reliable property management company to aid you in the collection of rent from your tenants, contact Bay Management Group today.

We can help you with every step of collecting rent – from the drafting of the lease agreement, complete with rent payment details to the eviction process (if need be) – so that you don’t have to worry about any of the stresses involved in collecting money from your tenants.


Top Reasons Landlords Use a Property Management Company

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 Addendums to Include in a Lease Agreement in Columbia, MD

Top Addendums to Include in Your Maryland Rental Property Lease

Drawing up an airtight lease from the very beginning is one of the most important things you and your Columbia, Maryland property management company can do.

Doing this prevents any confusion amongst the parties regarding what is to be expected throughout the lease term, and helps to protect both property owner and tenant.

If you are currently self-managing your rental property, you might want to consider beefing up your lease drafting skills.

In fact, unless you have a finely tuned lease template, now might be a good time to enlist the help of a professional property manager in Columbia to put one together.

Knowing what to include in your lease agreement can be challenging, especially at first. And, the truth is, basic lease agreement templates found on the internet do not always address your most pressing needs.

This can lead to a lot of confusion and heated discussions between you and your tenants throughout their lease term.

That’s why today we are going to examine what a lease addendum is, and some of the top ones all property owners should include in their lease agreements.

 

What is a Lease Addendum?

Typically speaking, a lease addendum is a lease provision that changes, clarifies, or nullifies a part of an original lease document. Once added, it becomes a legal part of the signed contract, and is enforceable.

That said, there seems to be some confusion between the terms lease addendum and lease amendment. We are here to clarify.

 

Lease Addendum

This is an additional lease clause or provision attached to the lease agreement template that adds or excludes certain terms.

At the time of signing, the lease addendums are included and agreed to by all parties.

A great example of a lease addendum is a provision outlining the right of entry by the property owner. Entry by a landlord throughout the lease term is not unusual, and needs addressing in the lease agreement.

Sometimes, a separate clause is drafted and added to the back of the general lease agreement so both the property owner and tenant understand what constitutes a legal entry of the premises.

 

Lease Amendment

On the other hand, if you and your tenants have already agreed to sign a lease agreement, and then want to add a provision or clause altering the original document, this would be considered a lease amendment.

A perfect example of this is a pet policy.

Keep in mind, this can be included during the initial drafting of the lease agreement as an addendum.

However, if the original lease made no mention of a pet policy, because your tenants did not have any pets, and halfway through the lease they decided to adopt a dog, an amendment to the lease agreement will be needed.

This will outline any rules you have regarding pets in your rental, and will be signed and attached to the already-finalized lease agreement.

 

Top Addendums to Include in Your Columbia Lease Agreement

1. Smoking

No Smoking Addendum is Popular With Maryland Rental Property

Whether you decide to make your Columbia rental property smoke free or not is a personal decision. However, if you wish to prevent smoking in your property, make sure to include a no-smoking addendum to the lease.

Clarify whether this policy applies to guests, and what the consequences are (including loss of security deposit) for breaching the agreement.

 

2. Pest Control

Pest control is a huge point of contention between landlords and tenants. There is plenty of debate over who is responsible for pest control, who is in charge of resolving a pest infestation, and who decides what constitutes an inhabitable living condition.

That’s why including a detailed pest control addendum is crucial to avoiding a landlord-tenant dispute. Just make sure to investigate your local laws regarding pest control, and clearly outline each party’s responsibilities.

 

3. Renters Insurance

Another critical lease addendum all Columbia property owners should include in their lease agreements is the requirement of renters insurance. It’s inexpensive, easy to get, and covers your tenants in a variety of situations, so you don’t have to.

Renters insurance typically covers the loss of your tenant’s personal property in the case of an emergency. It also takes some, if not all, of the liability off you if someone is injured while on your property.

Paired with your homeowners insurance, this provision is great for protecting your investment.

 

4. Roommates

Roommate Addendum Popular in Maryland Rental Properties

Your tenants need to understand your stance on roommates.

It is important you outline details regarding short- and long-term guests as well. After all, you don’t want to end up with adult tenants in your property that have not been screened, or are not paying rent.

In addition, you may want to include a separate lease addendum addressing the issue of subletting your rental. This way, you don’t end up with brand new tenants you have never met in your property mid-term.

 

5. Maintenance

Maintenance is a hot issue for tenants that lease your rental from you.

They want to know that at any time, no matter how minor the issue is, you are going to be available for maintenance and repairs.

Outline exactly what you will be responsible for, who to contact in the case of minor and emergency matters, and what type of maintenance and repair service they can expect.

In addition, do not fail to mention financial responsibilities of both parties, as well as maintenance issues that will be the responsibility of the tenants to handle (such as landscaping, filter changes, etc.).

 

6. Utilities

Include a Utility Addendum for Your Maryland Rental Property

Some property owners may offer covering the costs of some utilities as an incentive bonus for their tenants.

Or, you may choose to make your tenants responsible for all of the utilities.

Regardless, ensure your tenants know exactly what utilities they are to have placed in their own name.

In addition, any utilities that must remain under your name as the homeowner, but that you would like the tenant to pay, should be explained in this addendum.

This way, there is never any confusion as to who will pay for what, and when.

 

7. Move-Out Instructions

As much as you would love to have your existing tenants renew their lease with you forever, this is not a reasonable expectation.

That said, having clearly defined move-out instructions is the key to a smooth end of lease transition. Here are some things to include:

  • Forwarding address requirement
  • Key turn-in process
  • Cleaning procedures
  • Charge estimates for incomplete tasks
  • Charge estimates for broken or missing items
  • Supply costs and labor charges
  • Utility statuses
  • Move-out inspection process

 

Make sure your tenant understands the entire move-out process so that you don’t end up with a tenant that has disappeared with all of your keys, and has left a filthy rental behind that you have to take care of.

 

8. Early Termination

Early Termination Addendum Maryland Rental Property

Speaking of the end of a lease term, another lease addendum that is strongly suggested you include in your Columbia lease agreement is the early termination clause.

There might be an instance where your Columbia tenant needs to break the lease agreement early.

And, while this is not ideal, it is in your best interest to outline the terms regarding an early lease termination to preserve your losses as much as possible.

 

Other Important Lease Addendums

As you continue building your rental property business, and you gain experience, you will quickly build a solid list of lease addendums to add to every lease agreement that gets put into place.

Here are some other important ones to consider:

  • Appliances (including maintenance)
  • Lock changes
  • Fees and violation consequences
  • Use of rental for home business
  • Alterations
  • HOA terms
  • Right of entry
  • Extended absence procedures
  • Pet fees
  • Rent collection procedures

 

Many of these lease addendums may very well be a part of your basic lease agreement.

However, for those times when you need to add something specific onto an existing lease agreement before you and your tenants sign and begin the move-in process, it’s good to know what types of things can easily be turned into lease addendums.

 

If you own rental property and are in need of an experienced property management company in Columbia who knows exactly what should be included in a lease agreement, contact Bay Management Group now.

We have the expertise to draft airtight lease agreements, complete with every lease addendum you could possibly need. We guarantee that both you and your tenants will know exactly what is expected of each other, and that you and your investment property will be protected to the fullest extent of the law.


5 Simple Steps to Improve Tenant Retention in Baltimore County

Easy Ways to Boost Tenant Retention in Baltimore County

Failing to retain your Baltimore County tenants means you have a vacancy on your hands.

With a vacancy, you are no longer collecting a consistent rent payment each month, you probably need to make repairs such as paint the walls or replace the carpet, and of course, you’ll need to perform a deep clean.

That’s on top of the fact that you now need to advertise your vacant property, thoroughly screen all interested tenants, as well as deal with drafting a new lease agreement, collecting application fees and security deposits, and conduct move-in inspections.

That’s a lot of work, and very little money coming in.

In fact, it has been suggested that acquiring a new customer (or in your case, a new tenant) can cost five times more than keeping an existing one. 

Rather than deal with the constant turnover of a rental property in Baltimore County, and the subsequent loss of income and time, you should instead aim to improve your tenant retention rates.

In the past, we have discussed 5 solid ways to boost tenant retention. However today, we are going build off those 5 things and provide you even more steps to higher tenant retention.

 

Steps for a Higher Baltimore County Tenant Retention Rate

1. Make Communication a Priority

Communication between you and your tenants, as well as your Baltimore County property manager, is important when it comes to tenant satisfaction.

Having an open line of communication where tenants feel comfortable reaching out for anything they need will allow you to stand out amongst other landlords, as well as increase your chances of getting a lease renewal.

One great way that you can establish that communication is a priority for you is to give your tenants a tenant welcome packet prior to move-in.

This packet can include things such as important contact information tenants will need over the term of their lease, dining, shopping, and entertainment hotspots that are nearby, and general maintenance tips they should stay on top of during their lease.

 

2. Collect Rent…Online

Boost Tenant Retention by Setting Up Online Payment

In addition to having a solid line of communication established between yourself and your tenants, another great way to boost lease renewals is to make paying rent as easy as possible.

And today, most people are accustomed to paying everything online.

It’s convenient, available 24/7, easy to track, and makes your life a whole lot easier too.

Collecting rent online is a great idea – it helps your tenants, and it helps you and your Baltimore County property manager.

And, let’s not forget that it is the most secure and reliable way to collect money.

 

3. Spruce up Your Property

Many times, property owners only make major improvements to their properties in between tenants.

And, it makes sense to do so.

When the property is empty, it is easy to see what needs repair, and in order to avoid a long vacancy, that is the best time to make upgrades.

After all, the more amenities you have in your property, the higher rent amounts you can command.

However, failing to tend to the properties that have tenants in them is a big mistake.

To start, a property that is falling apart is not going to be one that a tenant wants to continue living in past the end of the lease term.

In addition, making small improvements to your property throughout a lease term, as a way of showing appreciation to your tenant for paying on time and being an all-around good tenant, will make your tenant more likely to want to stay another lease term.

One neat thing you could do, in order to really strike gold with your tenants, is to ask them if there is anything in the property they would like to see upgraded or fixed.

This will really go a long way come lease renewal time.

Your tenants will definitely remember come lease renewal time, when you replaced that old, partially functioning dishwasher with a brand new, water efficient one.

 

4. Call Before Coming Over

Call Your Baltimore County Tenants Before Coming Over

Issuing proper notices is the legal thing to do when you want to enter your investment property for one reason or another.

Not only is it illegal to show up to your rental property unannounced, but it also can really interrupt your tenant’s life.

What if they are having people over for dinner? What if they want to be home when you come over? What if they prefer not to be alone when you show up?

There are many things to take into consideration when you show up to your rental property for a routine inspection or general maintenance issue.

Respect that people live in your property, and treat it like their actual home.

If there is no immediate emergency, there really is no reason not to politely call ahead when you plan on stopping by, so your tenants can adjust their schedule and be prepared.

 

5. Use a Good Baltimore County Property Manager

Property managers typically have the most contact with your tenants.

This makes selecting the right property management company crucial to your success as a landlord, especially when it comes to tenant retention.

If your tenant cannot stand the property manager assigned to your property, has problems with administrative staff, or cannot get in touch with the on-call maintenance crew, you are going to have trouble convincing a tenant to sign a lease renewal at the end of their term.

No one wants to deal with a difficult property management company, no matter how great the landlord or the property is.

That’s why it is on you to do your due diligence when it comes to interviewing a property management company to handle your investment property.

In addition, if you notice any of the signs that your property management company isn’t cutting it, you need to know when to let them go.

 

If you are looking for an experienced property management company in the Baltimore County region, contact Bay Management Group today. With a dedication to providing superior customer service, you will never have to worry about a tenant wanting to leave your rental because of anything we do.

With 24/7/365 maintenance, online rent collection, and open lines of communication, your tenants will feel comfortable reaching out for anything they need.

And, you can count on us for top-notch vacancy advertisements, thorough tenant screening and placement, and plenty of advice on how to garner higher retention rates.

In the end, we have everything both you and your tenants need to be happy.


Should You Approve Tenants Without Meeting Them?

Philadelphia Property Managers Approving Qualified Tenants

Would you ever consider leasing your Philadelphia rental property to a tenant you have never met?

Most property owners would immediately say “no.” After all, meeting a prospective tenant in person leaves a valuable impression on you, and ultimately helps in determining whether they are a good fit for your property.

But is there really a reason to meet a tenant in person prior to approving them to lease your property?

 Several experienced landlords say “no.” In fact, many landlords have screened and approved tenants they have never met in person. Some landlords meet their tenants for the first time when handing over the keys to their property.

In addition, those that employ high quality Philadelphia property managers to place tenants in their rentals are in no way obligated to meet their property’s tenants, thanks in large part to the thorough job their property manager does during the screening process.

If you are wondering whether approving tenants for your rental property without meeting them is a good idea, keep reading.

Today we are going to share how you can find great tenants for your rentals without ever having a face-to-face meeting.

 

How to Approve Tenants for Your Philadelphia Rental Property Without Meeting Them

 

1. Have a Strict Screening Process in Place

Screening Process for Philadelphia Property Managers

If you are using Philadelphia’s leading property management company to help you keep track of all things property related, this will never be an issue.

However, for those that are self-managing their properties, enforcing a strict screening process is crucial.

Take a look at some things you can do while screening potential tenants that you haven’t met.

Verifications

Verifying a prospective tenant’s income, credit score, and rental history can be done using a mix of phone calls, emails, and faxes. If your potential tenant can prove they meet your criteria, there is nothing wrong with continuing the approval process, despite not having met them in person.

Here are some tips to help you with the initial verification of potential tenants:

  • Understand the average household income in your area so that you can price your rental accordingly, and assign proper income requirements to potential tenants
  • Set a minimum credit score you would like to see in any tenant that is placed in your rental
  • Conduct background checks on every prospective tenant to gauge what type of person they are, and how they might act as your tenant
  • Always avoid discriminating against protected classes, regardless of whether you meet a tenant in person or not

In the end, either your potential tenant will pass the criteria you set or not. Their income, credit score, and criminal background will remain the same regardless of whether you meet in person.

Application

Philadelphia Property Manager's Lease Agreement

Receiving a completed application from an interested tenant does not have to be done in person – email or fax works just fine.

Via an online application portal is even better.

If you use an online application system, you can receive not only the completed application with all of the tenant’s information, but the application fee as well via the portal.

With this system, there really is no need for you to meet a tenant in person to take an application and their payment. This is especially true if you have a property manager that can handle these steps for you.

Referrals

Tenant referrals are an important part of the tenant screening process. And, referral information is easily found on a tenant’s written application.

This means you do not have to meet with the tenant to contact referrals. Using the above-mentioned methods – email, fax, or an online application system – will do.

Again, if your property manager requires an in-person application drop-off, great. This does not mean however, that you need to be present at this drop-off, and also doesn’t mean that you need to meet a potential tenant in person prior to approval.

The key here is to gather information about your potential tenant from their referrals, and other information that will not change by meeting them face-to-face.

 

2. Learn the Red Flags

Tenant Red Flags for Philadelphia Property Managers

Some red flags may alarm you about a potential tenant, and can pop up without ever having met the tenant.

In fact, many of these red flags will appear during the tenant screening process, a process that does not need to be done in person to be effective.

Here are some things to be on the lookout for while attempting to place a tenant in your Philadelphia rental:

  • Tenants that you speak to on the phone that are negative about their past living situations are probably not the type you want to place in your rental. Sure, some complaints are justifiable. After all, not all landlords are perfect. However, those that have excessive negative comments about their past landlords, or the properties they lived in, are likely to be those that will never be satisfied with your property either. Without ever having met this tenant, you will know right away that they are not a good fit for your rental.
  • Unstable employment. Changing careers from time to time is normal for most people. However, interested tenants that have a long resume of past jobs listed on their application are not ones to mess with. Those that change jobs frequently run the risk of losing their jobs while residing in your property. This means you may not receive your rent on time, or at all, at some point during the lease term. Again, meeting a tenant in person will not change the fact that they cannot hold down a steady job. If an interested tenant has a long list of prior jobs, approving them to lease your property is probably a no-go.
  • Prior evictions. This is a big one, and not something you need to meet a tenant in person to find out. If your prospective tenant has had an eviction within the last 5-7 years, no amount of in-person friendliness can change the fact that they are a risk to you and your property.

 

In the end, there really is no reason you have to meet a prospective tenant in person prior to approving them to lease your rental.

All of the important information that is needed for approval is easily gathered through other means, and reveals immediately whether a tenant will be a good fit for your property.

If you own rental property in the Philadelphia area and are looking for an experienced, knowledgeable, and friendly property management team to help manage your property, look no further than Bay Management Group.

We focus solely on property management, offer competitive monthly management fees, and implement a strict tenant screening process that will not require you to meet a tenant prior to approval (if at all).

Start enjoying your life and lessen the stress of owning rental property by contacting Bay Management Group today.


How to Recognize and Handle Landlord Stress

how-handle-landlord-stress-takoma-park-rental-property

Being a property owner comes with a lot of stress. In addition to managing your rental property, as a property owner you must balance your work with everything else in your life.

This includes family and friend obligations, other work commitments, and free time. Not to mention, property related tasks such as rent collections, routine inspections, maintenance and repair requests, eviction procedures, and so much more.

Talk about a lot of things to handle at once!

If you own rental property in Takoma Park, and feel you may be falling victim to the stress that comes with being a landlord, keep reading to find out how to recognize and handle this issue.

Not only will these tips help you succeed in your rental property business, they will help you manage your work in a way that allows you to maintain a balanced and healthy life.

 

Are You a Stressed Out Landlord?

recognize-landlord-stress-prince-georges-county-maryland

Before we discuss how to manage the stress that comes with being a property owner, let’s first take a look at whether you are actually stressed.

What exactly is stress?

Stress is your body’s way of responding to a threat. This threat may be purely physical, or may cloak itself in the form of high demands that life regularly places on you.

In any case, as a way of protecting you, your body will begin to act differently in response to these threats.

However, if you remain stressed for too long, your health may begin to suffer and your body will not be able to protect you anymore.

Here are some of the most common signs you are a stressed out landlord:

  • Headaches
  • Memory issues
  • Aches and pains
  • Frequent colds or flus
  • Anxiety and irritation
  • Moodiness
  • Feeling overwhelmed
  • Eating more or less
  • Disrupted sleep patterns
  • Nervous habits (g. nail biting)

If you feel any of the above-mentioned symptoms on a regular basis, chances are you might be a stressed out landlord.

Unfortunately, denial often also comes with being overly stressed, thus making it difficult to recognize that changes in our behavior or moods are stress-related.

Also unfortunate is that it is sometimes considered a weakness to take a step back from the high demands of life and take a break due to increased stress.

In addition, we all have responsibilities that must be handled, and sometimes stress is not reason enough to forgo these responsibilities.

This is why learning how to manage landlord stress is a good tactic for staying the course without making yourself physically ill, or bailing on obligations.

 

How to Handle the Stress of Being a Takoma Park Property Owner

There are many ways you can handle the stress of being a landlord. And truthfully, what works for you may not work for another, and vice versa.

That said, here are some of the top ways to relieve the stress of being a landlord.

1. Make a To-do List…and Stick to it

handle-landlord-stress-make-to-do-list-takoma-park

There are a lot of things you need to do when it comes to managing your Takoma Park rental property.

Even if you have an incredible memory, you are bound to forget something at one point or another. In fact, trying to remember everything you need to handle can become a stressor in itself.

One of the best solutions for this type of stress is to keep a to-do list.

With a to-do list, you can easily write down the things you need to take care of, prioritize them accordingly, and mark them off as you complete them, so you know that everything has been taken care of.

2. Handle Repairs Immediately

No property owner wants to jump right in and handle every maintenance and repair request made by their Prince George’s County tenant.

However, the longer you put those requests off, the worse the situation will become.

First of all, ignoring a tenant’s request will only anger them. They pay to lease from you, and expect all maintenance and repairs to be handled promptly by you, or your property management company.

In addition, a repair that you put off may turn into a bigger problem and end up costing you more time and money to fix. That alone can become the source of a great amount of stress.

Luckily, preventing this is easy, so long as you handle issues right away.

 

3. Have an Emergency Fund

keep-emergency-fund-landlord-takoma-park-rental-property

In line with efficiently handling all maintenance and repair requests is the idea that you should have a sizeable emergency fund on hand to handle such emergencies.

Money can be the source of stress in all areas of life. It is no different in the rental property business.

If you have ever encountered a major repair in your rental property, one that you did not have the money to repair right away, think about how that made you feel.

Stressed, right?

Avoid the stress of having to dip into your personal bank account to pay for rental repairs by building up and maintaining an emergency fund to be used specifically for your rental properties.

 

4. Become Educated About the Business of Owning Rental Properties

Sometimes you may become very stressed when a situation with your rental arises that you do not know how to handle legally.

If you want to avoid things such as housing discrimination and improper eviction procedures, consider educating yourself on the federal, state, and local rental property laws.

Take advantage of the wealth of free resources aimed directly at property managers, and learn from others’ past mistakes.

Educating yourself on how to save time, energy, and money in the rental property business can make you feel more confident as a landlord, and less stressed when a problem pops up.

 

5. Employ a Property Management Company

ease-landlord-stress-hire-property-management-company-maryland

One of the best things anyone with stress can do is to ask for help.

It is okay to admit that you are a stressed out property owner.

In addition, it is okay to ask for help from a professional that is experienced in managing rental properties.

By hiring a Prince George’s County property management team, you will save yourself time and money.

Best of all, you will lessen the stress that is placed on your shoulders when trying to self-manage a rental property, and will be able to attain that work/life balance.

A quality property management company can do the following for you:

  • Advertise your rental immediately upon vacancy
  • Screen potential tenants and weed out problem tenants
  • Draft legally compliant lease agreements that address everything you want
  • Routinely inspect your property to ensure maintenance
  • Handle all maintenance and request calls, no matter the day or time
  • Properly evict a tenant, if necessary
  • Back you in the case of a landlord-tenant dispute that lands in court
  • Provide affordable management fee prices so that you can afford help

If you are in the market for an exceptional property management company to help you manage your Takoma Park rental property, contact Bay Management Group now. Not only can we handle everything listed above, we can take away the stress of being a landlord from you.

In the end, we believe that you should not take on the bulk of the stress that comes with being a property owner; rather, we should.

You should focus on enjoying the benefits of owning Takoma Park property, collecting monthly rent payments, and working your way towards a happy, and healthy life, free from stress.


Should You Offer Move-In Specials to Entice Tenants?

should-you-offer-move-in-specials-tenants-annapolis-property-management

Staying ahead of the competition is tough when you are a property owner in Annapolis. As the capital of Maryland, and home to the United States Naval Academy, there are plenty of tenants looking for a great place to live here.

And other property owners know it.

If you are wondering how to stand out from the crowd of property owners looking to capitalize on the appeal Annapolis provides tenants from all around – think rich cultural history, beautiful architecture, and perfectly maintained landscapes – it is time you consider offering move-in specials to entice renters to lease from you.

Move-in specials have the potential to attract a lot of attention to your vacant property, making sure that you have the largest tenant pool to choose from.

In addition, a good move-in special may convince a tenant deciding between two properties to choose yours over the alternative.

Today, we are going to look at several types of move-in specials to help you decide whether you should consider offering them to your Annapolis tenants.

 

When a Move-in Special is a Good Idea

when-move-in-special-good-idea-annapolis-tenants

Before looking at the various move-in specials you might want to offer your Annapolis tenants, let’s take a look at some of the conditions that, according to RentPrep, affect whether you should offer a move-in special or not:

  • Market Conditions. When the competition is tough, and property owners in the same area are racing for the same tenants, consider offering a move-in incentive. This way you can attract the largest tenant pool possible, and be pickier when it comes to tenant placement.
  • Less people tend to move during the winter season. Not only is it cold and less desirable to move, the holidays play a role in people’s financial decisions, and school is still in session. All these things cause many people to avoid moving, which means filling your vacant property will be more challenging. Offering an enticing move-in special can help.
  • Nearby Construction. If your investment property’s area is experiencing a boom in construction, this will be a good thing for your tenants – after the fact. However, during construction it will be harder to find tenants willing to deal with noise, blocked off areas, increases in traffic, and unfinished buildings near their home. Try offering them a move-in special and convincing them that the construction will be worthwhile.

These are just some of the most common reasons a property owner might consider offering prospective tenants a move-in special.

If this sounds like something you are dealing with right now, keep reading to find out what kind of move-in specials you can offer to boost tenant placement.

 

Top 7 Move-in Specials You Can Offer Your Prospective Annapolis Tenants

1. Flexible Lease Terms

It is important you draft airtight lease agreements that your tenants understand from the day they move in.

However, if you and your Anne Arundel County property management company work together, there are surefire ways to bend the lease terms just enough to entice prospective tenants, without sacrificing your rental property business.

Here are some great examples of lease provisions you can change to encourage an interested tenant to sign a lease with you:

  • Include an early lease termination clause, with a 30-day notice
  • Allow tenants to have pets
  • Permit tenants to temporarily decorate your property
  • Provide the ability to sublet the property under your direct approval
  • Make room for roommates to add themselves onto the lease agreement
  • Allow for a cosigner

If you can be slightly flexible when it comes to lease terms you are normally very strict about, you will open up the tenant pool significantly, and find someone to lease from you much quicker.

 

2. Waive the Application Fee

waive-application-fee-annapolis-tenants-rental-property

Moving is an expensive endeavor. From moving trucks to security deposits, and application fees to utility deposits, your tenant is going to be spending a great deal of money from the get go.

Try lessening the financial burden by waiving simple things like the application fee. This is especially helpful if your property management company requires every adult in the property to submit an application.

The money you will be saving the interested tenant may be just enough to convince them to go with your property, rather than a nearby competitor’s property.

 

3. Give Tenants the First Month Free

This is one of the most popular move-in specials you can offer tenants, and is also one of the most appealing.

As mentioned above, moving is expensive. If a tenant knows that they do not have to pay for the first’s month rent, they may feel less stressed about leasing from you.

Although you lose one month’s rent by offering this incentive, the tradeoff can be worth it. Eleven months of rent payments on a one-year lease is far better than a vacant property generating zero rent payments.

 

4. Online Rent Collection

online-rent-collection-great-move-in-special-annapolis-tenants

Though an increasingly popular method for collecting rent payments among experienced Anne Arundel County property management teams, offering online rent collection is still considered a special incentive.

Many people will jump at the convenience of being able to pay their rent online. By saving time, checks, and the headaches that come with mailed rent payments, your potential tenants may be more willing to rent from you if you offer them the chance to pay their rent online.

 

5. Property Upgrades

Sometimes all it takes to get an interested tenant to move into your rental property is the promise of an upgrade.

Tenants move into rented properties in hopes of making them feel as close to home as possible. This means many will be excited to learn that a permanent and beneficial change will be made to the property upon move-in.

Here are some things you might consider upgrading in order to get a high quality tenant moved in as soon as possible:

  • New, modern, or matching appliances
  • A fresh coat of paint
  • Upgraded flooring
  • Additional parking spaces
  • Bathroom remodels
  • Paid landscaping services

These are just some of the many things you can offer potential tenants in hopes of convincing them to sign a lease agreement with you. And remember, upgrades don’t always have to break the bank.

Oftentimes even small changes are enough to make a tenant feel special.

 

6. Rent Decrease

offer-rent-decrease-annapolis-tenants

If you are in a tight spot and need to place a tenant quickly, one great move-in special you might offer is a decrease on the asking rent.

Again, you will lose some positive cash flow by lowering your asking rent; however, a leased property is always going to make you more money than a vacant one.

 

7. Offer a Welcome Package

Offering your tenants a welcome package is a great way to build a better relationship, make your tenant feel special, and even encourage them to renew their lease come the end of their term.

In your welcome package, you can offer some generous and thoughtful things such as:

  • Gift cards to nearby restaurants
  • Bathroom staples
  • Kitchen baskets with goodies
  • Tickets to a local sports game
  • Plants to decorate their home
  • Coupons to nearby attractions

Encouraging tenants to move into your Annapolis rental property can sometimes prove challenging. However, whether you’re faced with stiff competition, the wrong time of year, or nearby construction, there are ways around all of it to secure a tenant in your property.

Try offering your potential tenants some of the above-mentioned move-in specials and see how that changes their tune.

And be sure to get Bay Management Group on your side to help advertise your property via multiple channels, to draft flexible lease agreements that satisfy both you and your tenant, and even to collect rent payment online.

 

Contact us today, and see how we can get your Annapolis property leased in under 30 days on average.


How to Handle Long-Term Guests in Your Rental Property

handle-long-term-guest-pikesville-rental-property

There is a thin line separating who should be considered a guest in your Pikesville rental property and who constitutes an actual residing tenant.  And, if you are not careful, guests that overstay their welcome in your rental property can quickly turn into serious liabilities if they become more tenant-like than guest-like.

In order to protect you and your Pikesville investment property, and remain a successful landlord, it is important you take proactive steps when it comes to handling long-term guests in your rental.

If you are not sure what these steps are, however, that’s ok.

Today, we will explain exactly how to handle a long-term guest in your rental property, so that you do not fall victim to an overstaying guest who should really be treated as a tenant.

 

What Constitutes a Long-Term Guest?

elderly-parent-moves-into-rental-property-long-term-guest-pikesville

How do you know if someone is in long-term guest territory? 

The easy answer is this: anyone who has signed a legally-binding lease contract with you is considered a tenant.  Anyone who has not signed a lease agreement with you is considered a guest while in the property.

However, what about those instances in which your tenant allows a guest to stay in your rental property for long periods of time?

Some example situations include:

  • Your tenant’s college student son/daughter comes home for the summer or drops out and “moves home”
  • An elderly grandmother moves back in with her child (your tenant), because she can no longer care for herself
  • A boyfriend or girlfriend sleeps over most days/nights of the week
  • Hired help, such as a nanny, lives on the property

This is where the line defining a “tenant” and a “long-term guest” begins to get hazy.

While guests are certainly allowed to visit your tenant for days at a time, how do you prevent a long-term guest from becoming a tenant that is unaccountable on the lease agreement?

To start, you can begin recognizing the signs that your Pikesville tenant’s guest may be turning into a tenant that is not on the lease agreement:

  • The guest begins to pay rent
  • Mail is delivered to the property in the guest’s name
  • More nights than not, the guest sleeps over
  • Pets, furniture, or other large personal belongings of the guest have been moved into the property

Next, you can take one of the biggest pieces of advice any property management company or successful landlord can give you when it comes to handling long-term guests.

Consider any guest at your rental property a tenant if they take up residence without permission from either you or your property management company, no matter what.

Typically, though every state differs, a guest that resides in your rental property for a period of 7, 14, or 30 (or more) days is labeled a long-term guest.  With these guidelines in mind, it is important you outline in your lease provisions what you consider a long-term guest, and after what period of time it is mandated your tenant inform you that a long-term guest will be staying longer than the allowed time.

Some additional examples of long-term guests include:

  • A friend who has recently lost his job and needs a place to crash
  • A family member on an extended vacation
  • Retired parents that stay for months at a time while visiting
  • A subletter your tenant signed a contract with, without your knowledge
  • Anyone renting a room from your tenant

Since there are several scenarios in which a “visiting” guest can turn into a long-standing tenant in your Pikesville rental property, it is crucial you understand how to handle this before it gets out of hand.

 

4 Ways to Handle Long-Term Guests in Your Pikesville Rental Property

 

1.  Draft an Airtight Lease Agreement

Making sure your Pikesville lease agreement includes a provision addressing the issue of long-term guests in your rental home is the key to preventing any issues from cropping up.  Be clear about how long a guest may stay at your rental property without permission from you.

Next, outline when permission must be received from you in order for a guest to stay longer than the allotted guest time period.

If you are unsure as to how to draft a lease agreement with long-term guest provisions, contact your local property management company, Bay Management Group, to help you.  We are experienced in all things rental property related, and are knowledgeable about all current federal, state, and local laws that may affect the handling of long-term guests in your rental property.

 

2. Prevent Subletting

prevent-subletting-pikesville-rental-property

Subletting your rental property as though it is a bed-and-breakfast can become a dangerous situation for everyone involved.

While your tenant may feel that allowing people to “rent” your rental property from them for a few nights here and there is harmless, the truth is you are at risk for major liability concerns, should anything bad happen.

If you want to avoid this situation all together, again, draft a clear lease agreement forbidding the subletting of your rental, for any purposes.

 

3. Stay Involved

One way to become a successful landlord is to stay involved in what is happening at your rental home.  Whether this means you, or your property management company, conduct regular inspections, periodic drive-bys, or personal visits to drop off something your tenant may need; you need to know what is going on in your property.

If you notice that there is an extra person that seems to be staying at your rental for more than a few days, be diligent about finding out the following:

  • Who the guest is, and what relation they have to your tenant
  • Why the guest is at your property
  • How long the guest plans on staying

From there, make sure to regularly check on your property to ensure no lease violations are occurring.  If, by chance, you realize that this “guest” has overstayed, take action.

Grab a tenant application and have your tenant’s guest fill it out so that they can be legally added to the lease agreement after a thorough tenant screening.  This shifts the liability from you to the newly residing tenant.

 

4. Be the Boss

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When your tenants agree to lease your rental, they sign a legally binding contract that holds them to follow certain rules and regulations.  If you find out that your tenant has violated the long-term guest provision, you must put your foot down immediately, and serve the proper consequences:

  • Provide written warnings, should neighboring people make complaints about parking violations, noise, excessive damage, and improper use of community amenities such as the pool, gym, or laundry equipment.
  • Start the eviction process with your property management company, even if your tenant is not at fault.

In order to avoid your own legal troubles, it is your responsibility to make your original tenant responsible for his or her guests at all times.  This is especially true for those guests that are bordering on becoming tenants of your rental property.

It is not unusual to expect that your Pikesville tenants will have guests at your rental.  In fact, it is not unusual to think that oftentimes, these guests may stay a few nights.  However, as a property owner looking to protect an important asset like a rental property, it is best to treat all long-term guests just as you would any other lease violation, if they overstay their welcome as per the lease agreement.

 

If you are in the Pikesville area and need help drafting a lease agreement that includes provisions regarding long-term guests in your rental property, get in touch with Bay Management Group today.  Not only will we help you with your lease agreement, we can help with tenant screening, routine inspections, maintenance requests, and any legal troubles that may arise out of an overstaying long-term guest.