All Forum Posts by: Phillip Austin

@Account Closed This is somewhat common in our industry! Yes, turning keys in early can be perceived as suspicious, however, in my experience, it's most likely circumstantial and not an indication that they damaged the home. 

With that said, make sure you document EVERYTHING in writing. When ALL tenants turn in keys, they are essentially relinquishing possession of the property and you are legally regaining possession. Make sure you communicate expectations in writing and let them know they're not permitted to re-enter once they turn in keys.

Regarding the repairs done before lease end date, you have every right to make any necessary repairs and deduct any damage from their security deposit as long as you have definitive proof they caused the damage REGARDLESS of lease end date.

@Maroof Mohammed Farooq As a professional PM working in Denver, I have seen a TON of sewer back ups in these older properties with clay pipes!

1. If the sections needing to be replaced are difficult to access (Ex: under a kitchen floor), then yes, they can be quite "involved." Flooring will need to be removed, appliances moved, trenches dug, etc..

2. Agreeing with @Andrew Syrios, you always want to get multiple quotes from at least two or three vendors. Compare the cost to replace sections versus the entire line. Depending on the age and condition of the clay, you may not need to replace the entire line. There are a few creative options such as installing a liner within the clay piping to extend its life. Get 2 or 3 opinions and quotes!

Sewer backups can be a nightmare to deal with especially in a rental! If it's a severe backup, it could cost you several thousand. So, don't kick the can down the road!

1. 100% you should hire a PM. Sure, a reliable friend or "superintendent" may be able to do the job and they may be cheaper; however, you want a licensed professional that you don't have to micromanage and also, knows the local laws/regulations in your area for when you a legal issue arises.

2. Agreeing with @Ricardo R., local REI meetups through BiggerPockets can be a great resource. You should also check out your local NARPM (national association of residential property managers) chapter. Any worthy, professional PM will be an active member in their local NARPM chapter.

3. My best advice: DO NOT get sucked in by the cheapest PM company. You get what you pay for! Make sure you ask them how many properties they manage; not how many properties the company manages but how many your dedicated property manager manages. It's not uncommon for larger management companies to give 200-300 properties per property manager. I've been there. It's awful and very difficult for those PMs to keep up with that many property owners, tenants, maintenance issues, etc. They have no clue what's going on at your property because they have too much to handle. 

Feel free to DM me if you need additional advice. Always happy to help!

As a professional property manager, here are my top tips:

1. For large capex projects, I highly recommend working directly with a vendor outside of the management company.

2. If you do decide to use the management company for large projects, always request additional quotes.

3. If you have a few vendors you trust, ask your management company if they'll work with those vendors. More times than not, they won't have a problem with it as long as the vendor is licensed and insured.

I used to work for one of the largest residential management companies as a regional manager in Colorado and can confidently tell you that a lot of the bigger companies make A LOT of money off maintenance. Roughly 40% of all of their revenue will come from maintenance. A lot of companies have markups and some of the markups are agreed to and some are hidden. So, be careful!

Agreeing with @Laura Stayton, yes, the co-signer is required to sign the lease as well as all other occupants. 

Quote from @Josh Schaap:

Quick and simple 2 questions:

1. What are recommended routes of creating lease documentation? I'm assuming I will need to connect with an attorney. Any insight on that process would be helpful.

2. Where are others having success posting rentals online? I've seen some of the options out there. I want to know which ones are working. 

Would appreciate more localized or MN-based feedback. And any referrals for both of these questions would be greatly appreciated.

- Josh

1. Some states provide standardized real estate contracts which I highly recommend using. If your state does not, then yes, you'll need to contact a RE attorney and have them draft your lease agreement.
2. Zillow and Facebook marketplace! I highly recommend avoiding craigslist. I've had too many experiences with scammers.

Hi @Austin Irwin! Great questions and ones that I get often.

It greatly depends on the language in your lease. If the lease is pretty standard when it comes to maintenance/repairs/damages, you should have the right to repair the damage and bill the tenants as long as you have definitive proof they caused the damage. You don't have to wait until they move out.

Although I understand your concern and wanting to wait to bill them, I always advize clients to abide by the terms of the lease agreement. They know they caused damage. They know they signed a legal document (lease). They should expect a bill. Treat it like a business and kindly remind them of the lease terms and what they're expected to pay for the damage.

Not billing them, crossing your fingers that the next 4 months go well and deducting the damage from their security deposit actually poses more risk. They may take advantage of you and continue damaging the home because they know you won't hold them accountable.

It's a tricky one to navigate! Be professional. Abide by the lease.

Hi @Shang Min Wang! Here is my advice:

1. Some states provide standard rental agreements which I highly recommend using. You can add separate addendums, if needed, that are specific for your properties such as pet addendums. If you use a state provided contract, there's less of a need to have an attorney review. You can also use the BiggerPockets forms for your state. For everything else, I highly recommend spending the $500-$1,000 to have an attorney draft your contracts.

2. Absolutely! You inspect for two reasons: ensure the unit is rent-ready (necessary repairs) and to document condition upon move-in (in case you need to deduct any damages from their security deposit when they move out). The inspection is crucial! Do not skip!

3. Instead of doing RUBS, I would suggest reviewing usage for the last 1-2 years and billing the tenants a flat fee. Be careful! Some states do not allow landlords to profit from utilities. 

4. BiggerPockets is a great resource for finding qualified local vendors. You can also search your local NARPM (national association of rental property managers) and review their vendor list. Good quality vendors often sponsor their local NARPM chapters because they understand PM companies in the area can be a consistent revenue stream. 

@Nathan Harden As a professional property manager, here is when I communicate with my owners:

- Monthly accounting statement (email)

- Maintenance requests that exceed the agreed upon maintenance limit (email/call/text; in my contracts, anything $300+ requires approval from the owner)

- Lease renewal (email; communicating 90 days prior to lease expiration to get owner approval on renewal extension)

- Leasing (email/call; review leasing timeline, marketing, and terms)

Generally speaking, the purpose of hiring a property manager is to remove the headache and let a professional handle most, if not all, aspects of managing the property. So, the overall goal should be minimal communication or communication on an "as-needed" basis. If you're just beginning your relationship with a new PM, communication may be more frequent as you build trust with one another. However, you should not expect daily or weekly communication with your PM.  

You will not have access to their lockbox. Ask the seller's agent to provide copies of keys to your local contractor. Then, have him purchase and place his own lockbox.