Frequently Asked Questions For Owners
Should I Rent out my House?
That is a question that only you can answer based on your personal objectives and what it is you want to accomplish. There is always a risk in renting out your house, just as there can be risks in any decision you make. Using a third party management company can reduce some of the risks, and bring some peace of mind to you while your home is being rented.
What needs to be done to prepare a property for rent?
The property should be in the best possible condition to attract a quality resident. Paint should be in good shape with marred or dirty areas touched up. Neutral colors for walls and floors are most attractive. Potential tenants often view homes with their senses, i.e. how it looks, how it feels, or how it smells. So the house should look, feel and smell clean.
Carpets should be professionally cleaned and blinds or shades are ideal window coverings. The home should be “detailed” clean and the yard in excellent shape. A good rule of thumb to ask is: “What would I expect if I or someone in my family, a friend or a relative were to move-in and rent this house.”
How do I determine the rental amount?
The competition determines the rental amount. As experts in the field, we know the market and the competitive rental ranges for your home.If the home is Marketed too high the home will be vacant much longer. If it is marketed too low, it may be one or two years before the price becomes competitive again. We want to price houses at the market.
The competition determines the rental amount. As experts in the field, we know the market and the competitive rental ranges for your home. If the home is Marketed too high the home will be vacant much longer. If it is marketed too low, it may be one or two years before the price becomes competitive again. We want to price houses at the market.
How do you market the property?
The property is immediately added to our rental availability list, web site, and other resources. We also list our properties on the Pensacola Area Association of Realtors Multiple Listing Service which makes the property information available to all real estate offices in the area.
Your listing is also included on Realtor.com which is available to anyone around the world searching for a rental. We even make our properties available for military housing. A sign is placed and marketing photos are taken within 48 hours. We track and keep up with the marketing effectiveness of the individual property.
How long will it take to rent?
Vacancy periods are market driven. There is also some luck involved in the right person looking at the right time. On average in today’s market it takes between four to eight weeks to rent a home. Homes rent more slowly between Thanksgiving and New Years. Location and of course, price can effect the length of vacancy.
What are the policies regarding pets?
It is a property owner’s decision whether or not to accept pets, or to determine the size or type pet that is acceptable. Statistics indicate that 75% of renters own pets. Obviously, restricting pets reduces the number of available qualified tenants, therefore the property could take longer to rent. In the application, we screen for pets.
If pet references are available we will check them out. In general, a well-behaved cat or dog could cause less wear and tear on a home and yard then a young child. If an owner chooses to accept a pet, additional fee for the pet.
What about smokers?
Though we do not ordinarily disqualify an applicant if they smoke, it is written in all of our leases that smoking is absolutely prohibited inside the property. This prohibition of smoking does not significantly reduce the marketability of the property, and in fact helps maintain the value of the property.
Do you collect first and last month’s rent up front?
It is commonly thought to collect first and last month’s rent. In actuality, it is our practice that before a tenant is allowed to move-in, we collect, up front, the first full month’s rent and a security deposit, which is usually equal to one month’s rent.
The security deposit is held in a separate property trust account as required by state real estate regulations. The deposit is not to be used by the tenant to pay the last month’s rent, but rather, it is to cover any damages or delinquencies after the tenant vacates. Any balance of the security deposit is refundable to the tenant.
What happens if the rent is late?
The rent is due on the first of each month. We begin collection proceedings after the 3rd of the month. It starts by contacting the tenant in regards to late rent and we send out a Late Notice. If satisfactory payment still can not be met, we will let the owner know and then the first step of the eviction process begins with a 3 –day notice to pay rent or vacate.
If the tenant still does not respond or pay rent, then eviction papers are filed at the courthouse. Most evictions are the result of loss of employment or some other cause of income loss. In many cases we use an attorney for evictions. Our eviction rate is low, around 1% of properties under management.
When are monthly funds distributed?
We must make sure that rental checks have cleared the bank and the accounts reconciled before disbursing funds. The payments to owners along with statements are processed by the 10th of the month, so owners generally receive their statements by the 15th of the month. Checks can be mailed directly to the owner’s bank account or mailed to the owner. Payments to Owners who had late rents (received after 3rd) may be processed later and received between the 25th and 30th.
Who handles emergencies?
A licensed property manager is always on call for emergencies. Tenants have a way of contacting us if there is an emergency. We have an extensive network of maintenance personnel and sub-contractors to handle any emergency on your property, day or night. We are on call 24 hours a day 365 days a year.
What is the average length of a tenancy?
Most of our rental agreements are for one year. However, with an owner’s consent we can do a lease ranging from seven to twenty-four months. At the end of the lease term the owner can decide to renew with the tenant (and if the tenant wishes to remain) or vacate the tenant. We do not recommend allowing a tenant to remain month to month because what time of year they decide to vacate comes into question.
If the market has changed the owner can raise the rent at lease end. Most tenants stay one to two years, however we have some properties where tenants have stayed well over three years.
How are repairs handled?
For any repair item, the tenant is instructed to contact our office. They usually contact us by phone or email. The lease requires, plus it is our policy that all repair requests be submitted in writing. Email or fax is an acceptable form. If we approve the repair, we contact an appropriate vendor from our list of vendors and create a work order. If the owner has an extended maintenance warranty policy, then we follow the procedures outlined by that policy. The repair is scheduled between the vendor and the tenant. It is also our procedure to notify owners of all maintenance requests.
For those repair items under a certain dollar amount as prescribed in the management agreement, we will have them done. For more expensive repairs over that specified dollar amount, we will discuss and seek the owner’s approval. If funds are available, the expense will be deducted from rent on the next month’s accounting statement. If funds are not available, the property manager will contact the owner for payment arrangements.
What happens if the tenant leaves before the end of the lease?
The tenant is responsible for the rent for the term of the lease. There are legitimate exceptions as specified in the lease for military orders. However, in most cases if a tenant leaves before the termination date they will be charged a two month break lease fee which is equal to two months of rent and they forfeit their security deposit. They are also responsible for any damages, cleaning, etc.
Do you inspect properties?
We conduct two walk through’s a year. One during the middle of each year, which is what we call an occupied inspection. One at the end of each lease year. This would either be another occupied inspection or a move out inspection. Depending on the tenants decide to leave or not renew. There is a charge to the owner for this. The owner will also be provided with a report and all the pictures the person conducting this takes.
How is the owner protected if the tenant damages the property?
A refundable security deposit taken at move-in is usually sufficient to handle the minor damage caused by residents. Residents with good credit and references seldom cause significant damage. If the resident leaves the property owing money for rent and/or damages they will be billed. If they do not pay we will provide to the owner all documents necessary to file for collections.
What about evictions? Who handles that?
Evictions are typically because of delinquent rent payment. Fortunately less than 1% of our leases end up in court. We have a process for collecting rent when a tenant is late. If it becomes necessary that eviction is the appropriate recourse, then we will handle the procedure, as there is a legal course that must be followed.
The owner will need to pay the required court fees. We also have access to legal counsel if that is necessary, and the owner will at least initially pay attorney’s fees. In the eviction judgment we try to recoup all delinquent rent, damages, court fees and attorney fees from the tenant. That is a question that only you can answer based on your personal objectives and what it is you want to accomplish.