The Old Fashioned Paper Rent Check

Written by on May 6, 2012 in Rent Collection - No Comments
Don't let your rent collection be like this!

The days of the paper rent check are numbered. While the rest of our purchases have changed – we are accustomed to paying with credit or debit cards, online banking and automatic recurring deductions from our bank accounts – rent, mortgage and HOA payments have lagged behind. These are often the only expenses people pay via check anymore.

A recent article from Multi-Housing News discussed how the rental industry is moving away from traditional paper checks into the future with ACH transactions, debit and credit cards, and even mobile payments. It’s really about looking at the generation of renters coming up and identifying how they can and will want pay the rent.

The biggest growing demographic in the rental industry is Generation Y. Classified as being born between 1977 and 2001, those between the ages of 16 and 33 now make up 25% of the population. With the housing market still weak and slowly reviving, many of them are choosing to rent and have contributed to the recent apartment boom.

According to research from MetLife, Generation Yers’  have been shaped by communication technology. Due to the range in age, some of them have used this technology since they were as young as age five and cannot remember a world without it. They were raised on 24/7 connectedness, and are accustomed to multi-tasking: juggling e-mail on their PDAs while surfing online and talking on their cell phones.

Landlords and property managers need to be aware of their changing market and begin preparing for the shift in their renter’s mindsets, if they have not seen it already. Renters will be demanding more payment options that fit into their online lifestyle and will expect the ease of being able to pay when they want from wherever they are.

RentMonitor makes it simple for landlords to offer online payments to their tenants. Check us out at http://rentmonitor.com to see how we can help you move your rent collection process online and automate it.

Photo by: British Postal Museum & Archive

Sublet the Right Way

Written by on September 2, 2011 in Forms & Leases, Landlord Tips, Management - No Comments
Houses-in-a-Row

When setting up their property management business and drafting apartment leases, landlords have to make some decisions about how they will handle future situations. One of these future situations includes subletting, or allowing a new tenant to take over the remainder of your current tenant’s lease. Some landlords are weary of this practice and think it will involve a lot more work on their part. However, it’s good practice for landlords to allow tenants to sublease their apartment if necessary.

There are several reasons this decision in beneficial to the landlord. First, it helps secure good tenants that might be nervous about committing to a year or two year lease. Second, as long as there is a clause in the apartment lease agreement stipulating a sublease tenant must be approved by the landlord, there is little risk of ending up with a bad tenant. Third, landlords may end up with a longer tenancy from the subleasing tenant and minimize their turnover costs. Finally, subleasing can help landlords avoid having tenants skip out on their lease.

Once you’ve decided it’s a good idea to allow for subleases, here’s how to make sure you do it right.

1. Include a clause for subleasing in your rental lease agreement. The following is a simple addition to a lease that will protect the landlord in subletting situations:

Resident shall not assign this lease, or sublet any portion of the leased premises, for any part or all of the term of this lease without prior written consent of the owner/agent.

Owner/agent agrees to release resident from this lease if resident finds a replacement resident acceptable to owner/agent, who will sign a new lease for the remaining term. Owner/agent shall exercise good faith and reasonableness in accepting a replacement resident.

2. Discuss your current tenant’s timeline and remind them of your qualifying standards that all of your residents must meet. At this point, it is your tenant’s responsibility to find a new tenant, but landlord’s should assist them if absolutely necessary. Costs for advertising can be charged to your current tenant if any are incurred.

3. Once your tenant has found potential subtenants, you need to run a background check to screen the applicants. As long as they meet your qualifying standards, give them your approval.

4. Draft up a sublease agreement and have all parties involved sign it. This agreement will make sure that all parties are on the same page and know what is expected. Here is an example Sublease Agreement Template. Please note that some cities and states have specific ordinances pertaining to subleases. Check your local laws to make sure you are in compliance.

5. Go back to business as usual. Reflect on the fact that you have a new qualified tenant and did not have to suffer any vacancy time.

Photo by: Claire L. Evans

Should You Join a Real Estate Association?

Written by on May 9, 2011 in Landlord Tips - No Comments
Looking-Up

When you are first starting out as a landlord or real estate investor, you might wonder if you should join a local apartment or investment association. There are already so many things on your plate and you are just an individual. Could it really be worth adding something else? The answer is absolutely!

Local apartment associations and real estate investment groups offer benefits to both the small investor and large company alike. In addition to having periodic meetings for networking and education, these groups also sponsor seminars, provide information about the industry, advise members of pending legislation and support lobbying efforts on behalf of their members. Other benefits include monthly newsletters and discounts on events, products or services.

Membership rates for individuals are usually charged on an annual basis and generally range from $75 – $150. Non-members can often attend their first meeting or event for free if they contact the association in advance.

If the small fee does not sound worth it, consider the advantage of meeting other people who can help you learn the business, avoid common mistakes, keep you current on market rents and vacancy factors in your location, and people who are in-the-know of what rental properties are coming to market before they’re listed.

Local groups can easily be found by doing a quick online search. Often there may be more than one group in your area so go to a meeting or two to check them out.

The bottom line is that joining an apartment association or real estate investment club is worth it if you can find one locally. The opportunity to interact with other like-minded investors is definitely worth it and the discounts on products and services often pays for itself.

Photo Credit: WarzauWynn