All Forum Posts by: Ethan Jacobsen

Every situation is unique. I would encourage you to look into a competent attorney, but I would also hope that your property management company would have a go-to attorney with an established relationship already. I would talk to your property manager, their attorney, and maybe contact a few others. Try to get referrals from other owners or even from your property manager. It might be better to have 1 firm looking at everything instead of getting 2 mixed up in it, but it'll all be up to you. I do think you should have an attorney contact that you can go to in situations like this. Be prepared. 

On another note, how does the tenant know your name and information? One of the huge benefits of having a property management company is to remain anonymous as the owner. We never tell tenants any information about the owners of the property. Sometimes they find out or already know when we take over management and there's not a lot we can do, but that's something you should talk about with your manager. Similarly, I would encourage you to not have direct contact with your tenants if you can manage that. 

If they're going after you in small claims, property managers usually represent themselves, but my biggest piece of advice is to get as much information as possible and use it all in the courtroom. I've made the mistake of assuming the judge would look at all the evidence. I assumed the judge would be annoyed if I retold every single detail that I already put in front of him. Turned out he didn't care what I gave him as "evidence", he didn't want more back and forth and then made his decision and left me in shock. Don't come under prepared. Have documentation, dates, photos, invoices, text threads, etc. Everything you have. This is where hopefully your property manager will have a lot of the needed information. 

If you have a chance to go to mediation, GO. That doesn't mean you have to mediate or anything, but if you walk up to a judge and tell them you didn't try and mediate, they could feel like you're just wasting more of their time. If you try, you can at least tell them that you tried. I didn't mediate once and the judge wasn't happy. I haven't made that mistake ever again. Both these mistakes mentioned were on the same case, so you can imagine how much I learned that day. 

In the end, I agree and say not to stress about it. Stressing and worrying won't do anyone any good. 

Usually we don't charge more rent for more people, but that also can depend on how you have the utilities set up. If you have any type of fee for utilities, that could potentially be increased based on number of tenants. Any individual who is staying there long term should also be on the lease, you're right on that. Standard leases should have a clause stating guests can only stay up to 7-14 calendar days per year and anything beyond that has to either be approved by the landlord or they have to be added to the lease. Start the conversation with the current tenant and let them know what the options are. In this situation it sounds like rent would stay the same, but if it's going to be consistent, a utility charge might need to be increased and the boyfriend should be on the lease or at least approved by you. In the end, what the lease says can either really help or really hinder. Good luck!

Yeah, it depends on where you are. Tenant placement fees are a little odd in my opinion since it isn't always aligned with the owners goals. As an owner, you want to minimize vacancy, but as a property manager that charges a tenant placement fee, you would be incentivized to get a new tenant placed every year with that kind of fee in place. We don't charge a fee at all for tenant placement - everything is covered under the standard management fee. However, some of our competitors charge $250-$400 as a tenant placement fee. So like @Drew Sygit said, it really depends on the area. 

You could do the submeter option and keep track of that yourself. That would just take time for you to record usage on a specific date each month. You could also establish a Ratio Utility Billing system which basically says that each occupant has to pay their "fair" share. So if unit A has 1 tenant, unit B has 3 tenants, and unit C has 2 tenants, you would take the total utility bill and divide it into 6 (for the amount of tenants). Unit A would pay 1/6 of the bill, unit B would pay 3/6 or half of the bill, and unit C would pay 2/6 or a third of the bill. Sometimes we have to do that with our properties. It's not a great option since the neighbor in unit A could potentially be using tons of water and not paying much for it. As for a fixed price, sometimes you'll come out on top and sometimes you won't. I've found that when utilities are "included with rent", tenants tend to use the utilities pretty freely. 

With all that said, @Joe Homs has a point. First take a look at your leases. You might not be able to make any changes right now, but it's always good to plan ahead. Hopefully you'll be able to get it figured out. Good luck!

This is an issue for us as well. It's a hassle and tenants are getting scammed. We've tried to contact local law enforcement to see if there's anything we can do, but we can't do anything since we aren't the individuals being scammed. We offer virtual tours as well and some scammers have actually been successful in taking "security deposits" from people too. We watermark all our photos with out phone number, website, and logo. Sometimes even with wording to "verify all information and apply only through the website above" and "avoid scams". However, people are still getting scammed. I tried reaching out to a local news station and they haven't jumped at the story. We just want tenants to know the "red flags" that pop up and how to avoid those scammers. We have tried posting to Craigslist to deter some scammers from posting it twice, but there are still issues. That's really the only potential solution I can think of - if you consider that a solution. 

@Nick D.

I forgot to mention what we use to figure out rental prices. We use Appfolio as a property management software and there's a feature in that which gives us some nearby comps. We have also used Rentometer which will pull some information from similar listings. The Zestimate on Zillow is sometimes very accurate and sometimes way off, so it's not very reliable on its own. Message me if you want a way to get some comps and I can help you out. 

We sometimes list on Craigslist when we're desperate or to combat the scammers. But Facebook can actually get a LOT of interest going. There are likely groups nearby dedicated to "ISO (in search of) housing". Whenever I post our unit in one of those groups, we get about 10,000% higher engagement on those posts. They reach thousands of people sometimes. I'd say posting it on local FB group pages could help a lot. Just make sure they're good groups with action. The FB Marketplace could help too. 

What we normally do is start at a desired price and then determine whether we should lower it or keep it based on interest and engagement. It looks like you've gotten quite a bit of interest, but no signed lease. I wonder if there's anything else that might be holding people back from signing. If you can afford the vacancy cost, I would say maybe keep it high for another weekend and then if you still don't have a signed lease by next Wednesday, drop it down $100. You could also reach out to some of your previous applicants and see if they would be interested at $100 cheaper. We actually have a calculator that we built with a spreadsheet to calculate whether it's more cost effective to lower the price to get it rented quicker or to keep the higher price and wait for the perfect tenant. Most times it's almost a coin toss. Of course, if you want to get it rented sooner, you might as well just drop $100 now and get it rented sooner. You can always do a rent increase in a year to make up for it. By the way, I looked on your profile and saw the pictures - You did a great job with the remodel!

@Darrick Lowe

Damages mainly. It's very hard to document everything and then hold the tenant responsible in the end. If you fail to take a good before picture or if you forget to inventory your stuff, they could take off with it or damage something and the burden to prove it was caused by the tenant is on the property manager or owner. Then there's the question of cleaning things like chairs, couches, beds, etc. Those can all get dirty and gross, so they would need to get cleaned maybe before and after depending on the tenants. Also, whenever we have rented out a furnished unit, it seems like the tenants want to stay for shorter periods of time, so there is more turnover. I think that you could potentially put some wording in the lease that says personal property is provided, but not maintained or replaced by the owner. We do this often with older appliances. If the owner doesn't mind a tenant throwing out an old fridge, they will sometimes include the fridge as personal property included with the unit, but it won't be maintained or replaced if it breaks. So the tenant is responsible for replacing it. At the end of the tenancy, there won't be a fridge, but usually owners okay with that.

Renting out a furnished place is definitely doable and can be more profitable sometimes. Just make sure you have everything documented with photos, videos (like @John Underwoodmentioned), an inventory list, and an increased deposit. I think people are sometimes also more likely to pay more for rent for a furnished place, so I would suggest testing that out. @John Underwood

I won't be able to answer all your questions, but here are a couple tips:

• Collect an increased security deposit. In California landlords can collect 3x the rent as a deposit if the unit is furnished. So look into that for NY. 
• Take HUNDREDS of photos and inventory everything you leave. Date and timestamp photos (use a free app on your phone) and make sure you take general shots of every area and room. Then up close shots of everything as well. Take photos of model numbers, barcodes, appliance models, serial numbers, etc. That way you can easily keep track of everything you left. This is also important in unfurnished units too, but even more important with personal property in furnished units. 

We normally don't rent units out that are furnished because of the potential issues that could pop up, but if you do, just make sure you cover your bases. Good idea asking on BP. 

I would suggest putting a clause in your lease (if you don't already have it) about lease breaks. We actually raised the price of our lease break fee a few years back because it was so low that people didn't mind paying it. Now that it's higher, people think twice before breaking their lease. Paying a large fee really means someone is committed. However, in this situation, I would suggest the same as @Mary M.. Give the tenant a deadline to make a decision. And if the tenant wants to move back, I'd suggest having them sign an addendum to the lease explaining all the requirements to break the lease. A $1,000 fee with the tenant being held responsible until another tenant takes possession would likely keep him there or scare him away. Just make sure the wording is correct and answers all the potential questions.