All Forum Posts by: Agustin Conti

I mean, you need to find out what the current market rent for your property is. Rent is up 30% in the last 2-3 years.  A 2.5% rent increase doesn’t even keep up with inflation. You might be hundreds of dollars under what you could be renting it for. And then a year from now you might be even further behind if you don’t increase the rent at least 5%, maybe more, depending on your market. 

The problem you have is 2 years is a long time. The local government could pass a rent cap during this lease. (If Vegas can consider it, anyone can.) If you were 10% under market, you will be legally stuck 10%, or more,  under market rent for the rest of your ownership. 

So many people who don’t use property managers don’t realize they are so far under market rent they could be using a PM and collecting more net rent. They are literally paying to be a property manager. At least reach out to a couple local PM’s and ask them how much rent they would charge, and how much it would cost you.

I've done an extended lease, the only advantage is you MAY have a tenant in there long term.

To be honest, even though I had a good experience, I wouldn't do it again. What if the relationship goes sour and now you are stuck with them? If they want to stay longer, then you can renew at the time and adjust the rent as necessary (if you so choose). You could also let them go month to month and still live there.

All you need to extend a lease is a paragraph or two. 

The existing lease between tenant xxxxx and landlord xxxxx for the property at address xxxxx is amended in the following ways.

The lease end date is now x/x/xx with the rent starting x/xx/x to be and the rent starting x/xx/xx (a year later to be old rent plus even more dollars). 

You want to find out current market rent and set your rent within 5% of that and then increase the rent to increase at least 5% a year from now for the 2nd year. 

This can all be handled in half a sheet. This is also a chance to add anything else you forgot in the original lease. No pets, or pet rent, landscaping responsibility, utilities, length guests can stay, etc etc. 

@Agustin Conti great to hear you are trying to take a go at it yourself. I'll try to assist:

How to renew a lease with a tenant without a realtor: Basically just take the current lease you have now between you and the tenant and update the new lease term and the new rent amount. 

What are the advantages of doing a multi-year lease: Advantages to you... none. 

Agustin, this should be pretty straight forward just draft a new lease update the dates and rent and send it to the Tenant for signing. You should offer the entire lease just updated preferable BUT can also just send the tenant an amendment/addendum which just extends the current lease to whatever date you both agree on. Regarding a 2 year lease, there is NO ADVANTAGE to you and in fact it is actually a disadvantage to you. Under any lease (any term from 1 month to 40 years) the Tenant can literally walk-away tomorrow and the only recourse you have is to hold on to the security deposit (and maybe not even that) because basically no judge will force a tenant to pay for a term they didn't use up BUT YOU, can not do anything until the term is up/tenant terminates, you can not increase rent, stop renting, etc. etc. and is also more difficult to remove a tenant until the term is expired.  My advise is stick to month-to-month or at most 1 year and no longer. I hope this helps. Thanks Ricardo for all the info, I find that knowing that

@Agustin Conti. I've had to do something similar to what @Jaron Walling described for my MTR in Asheville. When we started in 2018 there weren't even any MTR listings to compare to. Thus we listed it a little high with the plan to lower if needed. That's not too helpful for crunching numbers in the acquisition phase though. For LTR around here I think you can count on properties typically renting for what they're listed for (not so with MTR). And as @Scott Allen mentioned, Rentometer is pretty well-respected. If you see questionable figures in some rural spots I'm happy to give you some opinion on the locations. Many of our communities that have high STR income opportunities have quite the opposite opportunities for LTR (i.e., average income for full-time residents of our vacation spots is often quite low).

Hey there, I appreciate the update! Could I be nosy and ask why you decided not to continue against the insurance company? I assume it is because they would jack up your rates in the future and/or blacklist your property. Frankly, it is not worth fighting them most of the time unless something really crazy happens and damage is deep in the 10s of thousands or more.

@Agustin Conti

Rentometer is a good source for gauging long-term rents