All Forum Posts by: Lisa Doud

Well the debate on section 8 or not is very heated.  I have both excellent and down right awful experiences with section 8, but I have learned some tips and tricks that I will pass on to you guys.  

If someone wants to rent a property from me that is section 8 regardless of what city, I am blunt and straight to the point.  

• I tell them I have had a very bad experience with section 8 tenants destroying my properties, and let them know right away there will be monthly inspections.  I also ask for personal references.  
• I am looking for a personal reference that is not related to them, typically a minister, pastor, someone like that that usually wouldn't lie about their character.  
• When the drive up to my office I look to see what kind of vehicle they are driving (are the living within their means, or they trying to scam the section 8 program),  look to see if they have kids are they buckled in, and do they seem to have control of their kids. 
•  I also call the former landlords, and also request any tenancy reference from past landlords.  As part of my actually screening process, I look for any evictions, and if there was outstanding balances. 

After your tenant is already in the property I do the following.  

•  Inspect the property the first month they have lived there.  Make sure you remind them that you will be back every month ( you don't have to you just need them to think you are going to do an inspection so they keep the property neat and clean). I usually taper off to every 3 months after the 1st month....
• Before your annual section 8 inspection (typically  3 months in advance), do your own inspection.  Make sure if you see anything that is a tenant repair (light bulbs, holes in back of door knobs, light or outlet covers missing, missing shelving in refrigerators, etc,) you send a written letter to the tenant and also the section 8 case manager detailing what the tenant is responsible to do within 30 days of compliance. 
•  Also if you see water leaks, or any kind of major safety issues not reported to you by the tenant, you need to give notice for the tenant to vacate at the end of the lease.  This tenant will end up causing you more damage in the long run.  
• If you have any sort of catastrophic event in the property and you get a notice that the you have x amount of days to correct the deficiency prior to the HAP payment (section 8 payment) being stopped for non compliance, make sure you as the owner/agent are the one that is there to meet the inspector for the inspection, do not rely on the tenant because they will ALWAYS LET YOU DOWN... THEY HAVE NO INTEREST IN THE PROPERTY and if the property  is non compliant yo can't event for non payment.....
• Also if you have a re-inspection scheduled do not under any circumstances let a tenant move out thinking you will get back pay. Section 8 believes if the tenant moves out(even after their lease has expired) you are not entitled to the back rent because the property was in habitable.

Even through my little process, I still find the nicest "professional tenant" that knows how to play the game and I still get burned....  

All I am saying that section 8 is not the greatest, if you can avoid section 8 I would do it.  Right now I am currently managing 6 section 8 units out of 200.  

I would love the opportunity to discuss some options that my company could offer you.  Call my office if you want to talk. 757-295-8007 opt 2

I am roughly managing about 200 rental units, and 90% of the time my owners call me and I explain that they need to get a landlords policy before they rent the property, and most of them say what are you talking about....  When they go to the big guys they try to over sell you and will not bundle properties together because they have a cookie cutter mold, which is usually your personal property + 2 or 3 rentals and then the cut you off on how many they will insure for you.  

Also because most people don't know how much a landlord policy should be when it is only $5 cheaper they agree to it before they even shop around.  I always tell my owners that your insurance carrier should drop your rate at least 25% because you are only insuring the physical structure of the property, and your appliances.  Remember Homeowner's policies cover Personal property..... That is why you should see that reduction in the rate and if it is not at least 25% less than an homeowner's policy you need to shop around.  

Just for FYI before we went to our single policy for our properties we had Allstate on our personal property + 3 SF rentals, Nationwide on the 2 6 units, Farmers on our triplex, state farm on 2sf and 2 Townhouses.   When we tried to purchase our last building my office, State Farm couldn't help us because they had their max liability quota meet with us.  So that is when we had to come up with the drawing board.  Now all I do is add a new property to my policy and it  no problem, just give the specifics of the property, and it is there no questions....

I would check out a lot of independent insurance agents in your area.  Stay away from the Big name State farm, All State or even farmers.  My local insurance agent is TowneInsurance a subsidiary of our commercial lender TowneBank(they hold the mortgages on our MF), but my policy is with Middlesex Mutual.  

My husband and I own 26 rental units, and out of those we have 2 6 unit apartment buildings, 1 mixed use building with 3 Apartments (and my office commercial space), 5 single Family houses, and 2 townhouses.  All of our properties fall under one commercial property policy.  I actually cut my insurance cost down by almost $900 a year by bundling them all together, however my bill runs around 15K a year for all that.   I would tell you it is good to only bundle your properties if they are all rental but not if it is your personal.  

I guess I am totally different.  I prefer purchasing properties that don't have tenants.  1st there is usually a reason why the property is not occupied (weather mis management, or the lease expired) on an investment property the income that can be produced has a lot to do with the actual sale price, if a property is vacant I can get it for a much cheaper price.  2nd you do know how the former landlord handled business.  They the former landlord knows what they are doing and can provide you with a move in-out inspection form, then you are in good shape, but when it comes to the tenant finally leaving you don't know what you can actually charge to them as move out expenses, and what is actual normal wear and tear.

I am not sure what the law is there in Nags Head, but Here right across the boarder in VA It is illegal for a tenant to pay utilities for another unit. What I mean by that is that I have a duplex that has one water meter, I can not make the tenant in Apt A pay the bill for both apt a and Apt B. If I have a statement in the lease that the water bill is paid to me and spliced by both units that is fine, but the bill would have to remain in the name of the owner. Same with other utilities.

So what you need to do is get your electrical to find out what is on each panel and then you can decide from there.  As someone said earlier, I would definitely find figure out which electrical panel (if you have one for each unit) pays for the hot tub and compensate them accordingly.  

I think it is very important to never give tenants any sort of proration on their rent for work completed.  Once you do it once they expect it all the time.  About 6 years ago, I had a guy living in one of my properties that was an HVAC Tech,  His A/C unit went out and he said that their was a leak in the coil (the unit was only 1 year old),  He Quoted me $2500 which equates to 2 Months of free rent.   I went ahead and called my preferred vendor (one ho installed the system) he told me the entire system was still under warranty, and he just had to officially find out what was wrong with the unit and then submit to Janitorial for the parts.   When my preferred vendor went over he found that the "HVAC TECH TENANT" installed a Programable thermostat (not recommended in Rentals because some tenants don't know how to use them), and shorted the 24v circuit to ground thermostat circuit to ground.  My tech charged me a service call of $84.99, and $34.99 to put in a non programable thermostat, which I then charged the tenant....

What I am saying is you have to be very careful when dealing with tenants, if they think you don't know what you are doing and are too trusting that will try to scam you.  

My rule is not I will never use a tenant to do any kind of work on the property they live in because that is conflict of interest.  If they want to be a vendor of mine and work on other properties I manage that is fine, but they can't work on the ones they live in where they would be inclined to raise their labor cost to get more free rent.  

Well that is just my 2 cents..

In my experience, I have always felt that in a rental property you need to make the bathrooms and Kitchen ceramic tile.  We want them to be water proof, and you never know what the tenants are going to do in a shower.  For the main living areas you want to put a solid surface, commercial grad laminate (will run more upfront, but will last through multiple tenants) or if there is hardwood floors there refinish them.  A lot of people say ceramic tile, but if you live close to a beach and you are looking for that kind of feel then I would agree, but the wood/ or laminate floors warm and inviting.  Only place carpet in the bedrooms, this way if you have to replace one room then you can have your Handy man do one room, and nothing needs to be seemed.  

To create dramatic interest in the property I suggest you use a toasted cashew (light tan), and bright white on the walls.  Most rental properties are some sort of off white and look very institutional, and by adding the toasted chasew on the walls, the Bright white trip pops off the wall which creates that dramatic interest.  

In the kitchen, I would suggest you look for Nice clean appliances, we usually use white because if you have to replace one it is very easy to find a white appliance.  Also for countertops we use formica (remember it is a rental property), but you need to use a dark color, if a tenant burns it it is not so noticeable, you can either charge them for the repair, and if it blends in you don't have to change it.  

Let me know if you have any further questions.

I started my company because I had the very same problem as you did.  No one was consistent and could give me straight forward answers.  I know you are looking at the monthly fee as being more, but what you need to consider is how much you are loosing while your property is vacant.  Then if you look at your annual costs you will see that maybe that is worth paying a little more for monthly fees, as long as there are no extra hidden costs.  

You are more than welcome to sit down and speak with me if you would like.  My office is opened between 9am-4pm monday through friday.