Full moon, Friday the 13th, and a Move Out. Should I be scared?

Tonight’s a full moon on Friday the 13th and I have a tenant moving out. Oh boy, now is not a good time to get superstitious.

Move-outs are only fun for landlords when dead-beat tenants are moving out! Normally, the process is simply a pain: pending lost revenue, the pain of finding the next tenant, and finally, the dreaded move-out procedures and walk through. “How is the house going to look now?”

I have learned the hard way, like most things in my life, that this requires a few key things – simple to state, more challenging to execute:

  1. Clearly define exactly what the security deposit is and is not used for upon move in.
  2. Take the time to properly document the home’s condition before move in. Use your cell phone to take pictures of everything. I use apps like Evernote to keep all my pictures in one place.
  3. Like the rent and the late fees, stick to the agreement. Take good notes of what is damaged and photograph it to provide solid documentation and rationale as to why they are loosing part (or all) of their security deposit.

Keeping the entire relationship buttoned up and professional is critical because breaking up is hard to do…..and it’s always to best to leave things on a good note. Solid execution is the hardest part!

What is your move-out process?

I love you so much, I am raising your rent.

Are you an independent landlord that has ever been pushed into this challenging position? “You are a great tenant but I have to raise your rent.” If you’re like I am, it’s not the most fun thing to do. You have a solid relationship with your tenant, you care about their well-being and you care about their home but your costs have gone up and something has to give. It’s not an easy thing to do when don’t have a large company behind you to simply say, “Corporate is enforcing a mandatory 5% rent rate increase on all units for 2014.”

A few suggestions that have worked for me in the past.

  1. Define and document future increases ahead of time. Lay the groundwork early that when you renew the lease, the tenant should expect to see a rate increase of x-y%. Document it in the lease so you can refer to it when the time comes to renew.
  2. Explain the reasons and make the ask. Making the ask is straight from a Sales 101 playbook, but you can’t really get what you need until you ask for it. Support your reasons with a brief explanation of your cost increases – most people understand.
  3. Be consistent about all lease details. If you are good about collecting rent on-time, collecting any owed late fees, and generally staying on top of the details, it will be easier to refer to the current lease when discussing the renewal – you have set the precedent that you never deviate from that current lease.
  4. Enforce it. It is a business, not a charity.

How do you handle this challenge?

I love you so much, I am raising your rent.

Are you an independent landlord that has ever been pushed into this challenging position? “You are a great tenant but I have to raise your rent.” If you’re like I am, it’s not the most fun thing to do. You have a solid relationship with your tenant, you care about their well-being and you care about their home but your costs have gone up and something has to give. It’s not an easy thing to do when don’t have a large company behind you to simply say, “Corporate is enforcing a mandatory 5% rent rate increase on all units for 2014.”

A few suggestions that have worked for me in the past.

  1. Define and document future increases ahead of time. Lay the groundwork early that when you renew the lease, the tenant should expect to see a rate increase of x-y%. Document it in the lease so you can refer to it when the time comes to renew.
  2. Explain the reasons and make the ask. Making the ask is straight from a Sales 101 playbook, but you can’t really get what you need until you ask for it. Support your reasons with a brief explanation of your cost increases – most people understand.
  3. Be consistent about all lease details. If you are good about collecting rent on-time, collecting any owed late fees, and generally staying on top of the details, it will be easier to refer to the current lease when discussing the renewal – you have set the precedent that you never deviate from that current lease.
  4. Enforce it. It is a business, not a charity.

How do you handle this challenge?

I love you so much, I am raising your rent.

Are you an independent landlord that has ever been pushed into this challenging position? “You are a great tenant but I have to raise your rent.” If you’re like I am, it’s not the most fun thing to do. You have a solid relationship with your tenant, you care about their well-being and you care about their home but your costs have gone up and something has to give. It’s not an easy thing to do when don’t have a large company behind you to simply say, “Corporate is enforcing a mandatory 5% rent rate increase on all units for 2014.”

A few suggestions that have worked for me in the past.

  1. Define and document future increases ahead of time. Lay the groundwork early that when you renew the lease, the tenant should expect to see a rate increase of x-y%. Document it in the lease so you can refer to it when the time comes to renew.
  2. Explain the reasons and make the ask. Making the ask is straight from a Sales 101 playbook, but you can’t really get what you need until you ask for it. Support your reasons with a brief explanation of your cost increases – most people understand.
  3. Be consistent about all lease details. If you are good about collecting rent on-time, collecting any owed late fees, and generally staying on top of the details, it will be easier to refer to the current lease when discussing the renewal – you have set the precedent that you never deviate from that current lease.
  4. Enforce it. It is a business, not a charity.

How do you handle this challenge?

I love you so much, I am raising your rent.

Are you an independent landlord that has ever been pushed into this challenging position? “You are a great tenant but I have to raise your rent.” If you’re like I am, it’s not the most fun thing to do. You have a solid relationship with your tenant, you care about their well-being and you care about their home but your costs have gone up and something has to give. It’s not an easy thing to do when don’t have a large company behind you to simply say, “Corporate is enforcing a mandatory 5% rent rate increase on all units for 2014.”

A few suggestions that have worked for me in the past.

  1. Define and document future increases ahead of time. Lay the groundwork early that when you renew the lease, the tenant should expect to see a rate increase of x-y%. Document it in the lease so you can refer to it when the time comes to renew.
  2. Explain the reasons and make the ask. Making the ask is straight from a Sales 101 playbook, but you can’t really get what you need until you ask for it. Support your reasons with a brief explanation of your cost increases – most people understand.
  3. Be consistent about all lease details. If you are good about collecting rent on-time, collecting any owed late fees, and generally staying on top of the details, it will be easier to refer to the current lease when discussing the renewal – you have set the precedent that you never deviate from that current lease.
  4. Enforce it. It is a business, not a charity.

How do you handle this challenge?

I love you so much, I am raising your rent.

Are you an independent landlord that has ever been pushed into this challenging position? “You are a great tenant but I have to raise your rent.” If you’re like I am, it’s not the most fun thing to do. You have a solid relationship with your tenant, you care about their well-being and you care about their home but your costs have gone up and something has to give. It’s not an easy thing to do when don’t have a large company behind you to simply say, “Corporate is enforcing a mandatory 5% rent rate increase on all units for 2014.”

A few suggestions that have worked for me in the past.

  1. Define and document future increases ahead of time. Lay the groundwork early that when you renew the lease, the tenant should expect to see a rate increase of x-y%. Document it in the lease so you can refer to it when the time comes to renew.
  2. Explain the reasons and make the ask. Making the ask is straight from a Sales 101 playbook, but you can’t really get what you need until you ask for it. Support your reasons with a brief explanation of your cost increases – most people understand.
  3. Be consistent about all lease details. If you are good about collecting rent on-time, collecting any owed late fees, and generally staying on top of the details, it will be easier to refer to the current lease when discussing the renewal – you have set the precedent that you never deviate from that current lease.
  4. Enforce it. It is a business, not a charity.

How do you handle this challenge?

Calculate whether to Rent or Buy

Earlier this week I wrote about the struggles of renting a great home in the City of Atlanta. The market has obviously shifted; there is limited supply and whatever supply that comes available seems to be put up for sale because homes are selling and prices are up. Admittedly, I don’t know about the market demands in many other areas and I was curious. So in my research to learn about other markets I came upon the best calculator I have ever seen, published by the NY Times, titled Is it Better to Rent or Buy?, by Mike Bostock, Shan Carter, and Archie Tse.

Prices have risen nationally, particularly in major markets like San Francisco, LA, NY, and Boston. Have they risen so much that we are approaching another bubble? For those stung by the financial crisis of 2008 it is a worthwhile consideration. Nevertheless, the NY Times Rent or Buy calculator is a great way to determine what makes more sense for you.

Give it a try!

Renting is tough.

Already this week I have received two calls from friends about finding a decent place to rent. Both had special needs – one was looking for a six-month lease and the other was looking for a high-end four bedroom home. Neither of these needs are easy to satisfy.

Welcome to 2014. In my area of Atlanta, homes are selling quickly and are therefore not being put up for rent. Quite a different environment than a few years ago.  In fact, in the fall I am looking to sell one of my properties that I have been holding and renting since 2008. If all remains stable, I expect this particular home to sell quickly. But this is Atlanta….I also have properties in a rural area near Lake Oconee, an hour east of Atlanta, where the sales landscape remains a bit slow. In this rural area the rental market remains solid, however there is just so much inventory that prospective renters have a lot of choices and can demand more, like flexible six-month lease terms.

In the end, I had to recommend to my friends looking for the six-month lease to talk about it with a big-box apartment holding company in our area. My friends looking for the high-end homes inside Atlanta? Hmm…that one is near impossible at the moment. But, hey, if you’re looking for a small, two-bedroom home in Putnam County Georgia, I am your guy!

What about in your area?