Connecticut Property Management Blog

The Question That Can Make or Break Your Next Rental Deal

Thu, 07 Aug 2025 16:21:44 GMT

The Make-or- Break Question for Wise Landlords

Every investor looks at numbers. But the smartest ones also look at livability.

Before you buy your next rental property, ask yourself this:

Would I live in this rental?

Not would you want to live there. That’s different.
Not whether it has your dream kitchen or backyard firepit.
But if you had to move in for a year, could you make it work?

If the answer is no, it’s time to stop and look closer.

Why This One Question Matters So Much

A lot of investors get caught up in spreadsheets. They love the projected ROI, the cap rate, the “cash-on-cash.” And yeah, those numbers matter. A lot.

But there’s a problem.

If the property feels dark, cramped, weird, or rundown... if the street is loud, unsafe, or isolated... if the layout makes zero sense or the place has a strange smell baked into the walls, then the numbers don’t mean much.

Because a tenant still has to want to live there.

Livability Drives Everything Downstream

Here’s what we’ve seen over the years:

Homes that feel clean and comfortable rent faster
They attract better-quality tenants
They stay occupied longer
They generate fewer complaints
They take less wear and tear
And they hold value better over time

When a rental feels like somewhere someone could actually enjoy living, you cut out 80 percent of the friction that comes with landlording.

You don’t have to offer luxury.
But you do need to offer dignity.

Red Flags We Watch For

When we walk a property with a client, here are a few red flags that signal “bad fit,” even if the numbers look good:

The windows are small and the rooms feel gloomy
There’s an odd smell you can’t quite place
You walk in and instantly feel cramped or disoriented
The street has too much traffic or not enough lighting
There’s a long list of deferred maintenance you can see
The neighbors’ properties are in rough shape
Or worst of all: your gut says “this doesn’t feel right”

You don’t have to run from every imperfection, but you do need to notice the big picture. Livability is about the whole experience , not just rent per square foot.

Real Example: The Duplex That Looked Great on Paper

A client came to us with a duplex that had what looked like perfect numbers. Each side rented for $1,600. The mortgage would be $2,100. Insurance and taxes came to $400. Cash flow looked solid.

But when we visited, it was a different story.

The street was noisy, right next to a tire shop. The units were dark and smelled like old smoke. The layout had both bedrooms in the basement. There were no closets. And the backyard had a broken fence and cracked patio.

Could you technically rent it out? Yes.
Would people be excited to live there? Not likely.

Our advice: keep looking.

That investor waited three months, found another duplex with smaller numbers but way better feel, and now has tenants who signed two-year leases and treat the place like their own.

Sometimes the safer bet isn’t the one with the highest upside. It’s the one with fewer headaches.

What Livability Actually Looks Like

You don’t need granite counters. But you do want:

A layout that flows
Natural light in main rooms
A kitchen people can actually cook in
A neighborhood people feel safe walking at night
Close access to groceries, jobs, or transit
A clean, well-maintained feel, even if the materials are basic

Livability is the difference between short-term tenants and long-term ones. Between someone who moves out after one lease and someone who stays for years.

A Smarter Way to Buy

When you’re evaluating a rental, the numbers are step one.
But the gut check is just as important.

Ask yourself:

Would I live here if I had to?
Would my sibling or cousin live here?
Would I feel safe walking in and out at night?
Would I feel okay charging rent for this space?

If you don’t feel good about the answers, it’s worth taking a second look.

Need a Second Opinion?

We help landlords think through all sides of a deal and not just the ROI, but the day-to-day reality.

We’ve walked hundreds of properties. We know what good ones feel like, and we’re not afraid to say when something looks like a mistake.

Thinking about buying? Let us walk it with you.
We’ll help you make a smart, confident decision you can live with. Literally.

What Landlords Need to Know in 2025

info@robertcwhite.com (Luke Eddinger) — Wed, 14 May 2025 17:49:36 GMT

Connecticut's Rent Increase Laws

Connecticut landlords, take note: rent increase rules have recently changed—and staying informed is essential to remaining compliant and avoiding unnecessary tenant disputes. Whether you own a single rental unit or a multi-family portfolio, here's what you need to know about the rental increase law that’s been in effect since October 1, 2024 .

The 45-Day Notice Requirement

Under the updated law (Connecticut General Statutes § 47a-4e), landlords must now give tenants at least 45 days’ written notice before increasing rent provided the lease is for more than one month. This notice must be delivered in writing and should clearly state the new rental amount and the date the increase will take effect.

This applies to:

Month-to-month tenants
Annual lease renewals
Any fixed-term lease longer than one month

For leases of one month or less , the notice must be equal to the rental period (e.g., 7 days for weekly leases).

No Cap on the Amount But It Must Be Fair

Connecticut does not impose a limit on how much landlords can raise rent. However, the increase must not be:

Retaliatory (e.g., in response to a tenant complaint)
Discriminatory
“Harsh and unconscionable,” especially in towns with Fair Rent Commissions

Fair Rent Commissions: Your Tenants Can File a Complaint

Municipalities with over 25,000 residents are required to establish Fair Rent Commissions . These bodies allow tenants to challenge rent increases they believe to be excessive. If the commission finds the increase to be unreasonable, it can delay, reduce, or phase-in the increase.

For landlords operating in these towns (like Hartford, New Haven, Bridgeport, and Stamford), this means any significant rent increase could come under scrutiny even if you’ve provided proper notice.

Best Practices for Landlords

To stay on the right side of the law and your tenants, here are a few recommended steps:

Provide Clear Written Notice: Email is fine only if the lease allows it. Otherwise, deliver notices in person or by certified mail.
Document Everything: Keep a copy of the notice and delivery method in your records.
Stay Informed About Fair Rent Commissions: Know if your municipality has one and understand the complaint process.

Avoid Mid-Lease Increases: Unless explicitly permitted in the lease, increases should only take effect at renewal.

Why This Matters

Ignoring this new notice requirement could cost you more than a few frustrated emails, it may result in legal action, delays in rent collection, or damage to your professional reputation. Clear communication and legal compliance are crucial pillars of successful property management.

Got any questions? Please don’t hesitate to contact us directly at (860) 200-3331 or via email at info@robertcwhite.com.

How to Fill Your Rental Property During Slow Winter Months

Thu, 17 Nov 2022 18:27:00 GMT

Vacancy Coming in Winter? Take These Steps to Get Ahead

Fact, moving during the winter is more difficult for renters. This means landlords should expect and prepare for less activity in the rental market from Thanksgiving through the start of April here in Connecticut. Of course, the easiest way to avoid filling vacancies in the winter months would be to align your lease's end dates with the prime summer rental season, but things don’t always go as planned. If you end up with a tenant who wants to move out in the middle of winter then, what can you do to help fill that upcoming vacancy fast? Here are five simple strategies for you to try:

1. Highlight Listing Features

In order for your off-peak listing to stand out during the winter, why not try and highlight some of the key (and cozy) features of the property? If the home is close to transit for easy commutes during the winter, let people know that...nobody wants to walk miles to the bus stop in the snow! If your unit has a working fireplace and a warm inviting atmosphere, highlight those features too. Make your listing sound like a home they’ll want to be in for the holiday season. And don’t forget, you should also highlight features that will become useful again when the weather changes, like a large backyard or nearby parks. Don't leave something out that could attract just the right candidate at a time when less of them are searching!

2. Update Listing Photos & Video

Please, landlords, update the darn photos. We need to make your property look as attractive as possible and that often starts with a visual. Just because your property is being listed in winter, doesn’t mean you need to post photos of a snow covered driveway. Plan ahead to get high quality images of your units during the summer months. This way people can picture themselves living there during the nicer parts of the year too.

PRO TIP: If possible, you should also shoot a quick video tour of your property! Video can multiply the number of interactions and interest you get quite a bit. Feel free to check out one of our short tours here , they really don’t need to be fancy.

3. Sweeten the Pot (Offer Incentives)

Another trick that landlords use to fill off-peak vacancies is to offer lease incentives! You’re not a retail store, so you can’t give out 2 for the price of 1, but here are a few effective incentives we use at RCW & Co. when we need to fill a vacancy fast:

½ off the security deposit with move-in by certain date
Cashback to the tenants upon lease signing
Their first month is free when a tenant moves in by certain date
Owner will upgrade one appliance of tenants choice upon lease signing
Include bonus utilities free of charge (cable/internet/laundry facility)

4. Add Flexibility to Your Lease Terms

As we mentioned before, people simply have less desire to move during the winter. This means the tenant pool gets smaller and more difficult to attract. Landlords should consider being more flexible in their requirements then to accommodate for less rental activity. If you don’t allow pets, maybe this is a time to consider, since stats show that more than 50% of renters now own an animal of some kind. This prevents you, as a landlord, from narrowing the selection options further than necessary!

You can also offer lease options with shorter (or longer) terms. These can be a benefit to both the tenant and the landlord. Say a landlord signs a 6 month lease with someone in December instead of the typical 12 month term. The landlord now gives themselves the chance to re-market the property during peak rental season! It also means the renters have a shorter commitment with more flexibility.

5. Show with Tenants in Place

As soon as you know a vacancy is coming…market your listing and begin showing it (even with tenants still there)! Many landlords make the mistake of listing their units only when the tenants have completely vacated and left them with an empty unit. An empty unit in the winter is even worse than normal though, because not only will the landlord miss out on rental income, they’ll also have to pay to heat the home and keep pipes from freezing. Smart owners get ahead of the curve by marketing the listing while the current tenants are still completing their move out! If you can show your property to prospective tenants while you still have someone in place, you may even have a chance to eliminate vacancy altogether.

Don't hesitate to try these offers, incentives, and tricks! The longer you wait to implement them, the more vacancy you'll see. Don't get caught off guard this winter if you end up with a tenant that requests to move out unexpectedly. Or, you can always give us a call here at RCW ! We have the highest rated property management and leasing team in the state, and we know how to find quality tenants quickly.

Keys to Renting Out Your Single-Family Home & Maximizing Returns

Wed, 10 Aug 2022 15:50:23 GMT

Strategies to Get the Most from Your Single-Family Rentals

The market for single-family rentals remains extremely active. Here in Connecticut, Robert C. White & Company is filling units at a near-record pace in 2022. With new construction still behind schedule and at a premium, things don’t look like slowing down with rentals either. We’re Connecticut’s leasing and property management experts when it comes to single-family property. Let us show you how we maximize rental returns on single-family homes for our owners each and every month!The body content of your post goes here. To edit this text, click on it and delete this default text and start typing your own or paste your own from a different source.

1.] Maximize Rental Rates by Comparing to Similar Properties Every Six Months
This should be a rule for any rental property, but comparing your single-family home's rental rate with comparable listings at regular intervals should be a priority. This is to make sure you’re rents match similar properties at each renewal or vacancy period. Estimates done earlier this year showed that in Connecticut, rents have increased about 12% on average since the start of the pandemic. In many areas of the state, increases have been significantly higher. If you haven't kept your rates in line with others over this period, you could be missing out on rental income.

2.] Time the End of Your Lease Correctly [School’s In]

What’s the best time of year to get the maximum rental rate on your property? Usually, in the middle of summer as families begin preparing for the start of the school year in Connecticut. Tenants that most often rent single-family properties have kids, and they want to have those kids settled in before the school year starts. This means the highest competition and thus the highest rental rates, close in the summer months when families are most likely to move. Timing the end of your lease to fill a vacancy or renew tenants at the right time is a critical skill, especially if you own a single-family property where families are more likely to apply.

3.] Optimize Your Rental Home for Children and Pets

This next tip is easily related to the last! When it comes to renting single-family homes (SFH for short), you want to optimize for both children and pets. This means that if you have extra space that can be converted to bedrooms or a part of the yard that could be cleared for pets, it should be done in advance of listing and showing the property. The property layout should be functioning to its full potential. That being said, you also need to ensure the home is marketed correctly so that the listing reflects exactly what’s available. Forgetting to highlight key features optimized for the type of renters you want will mean missed revenue.

4.] Implement Pet Fees for Your Protection

Firstly, a secret piece of advice for landlords out there…you should screen pets almost as thoroughly as you do tenants. Ask questions about pets from a landlord reference, require veterinary documents, and potentially request to meet them in advance of acceptance. Even with good pets though…damage will happen! That’s why charging a monthly pet fee and/or requiring a pet security deposit (separate from the traditional deposit) is a smart move. A pet fee of just $25 per month over the year can build a small cash reserve in case a floor needs to be refinished or scratches to a door need to be covered because of damage from a pet. With a pet fee, the repairs don’t come out of the owner’s pocket, and the same would go for a pet security deposit. Protect your investment by implementing the appropriate fees.

5.] Place the Utilities Responsibilities in the Hands of Tenants

One of the biggest benefits of investing in single-family homes is that a landlord can put most responsibilities on the tenants, including utility costs. In multi-family buildings where there are common areas or utilities can't be separately measured, this burden falls on the owners. Predicting the cost of utilities and trying to work them into the price of rents can be extremely difficult and time-consuming…but that problem does not exist for an investor in with single-family property. The owner of a SFH rental can pass off the responsibility and save themselves time and money in the process.

6.] Do Your Own Small Maintenance Where Possible

One cost that you won’t be able to pass off to your tenants, even owning a single-family, is typical maintenance. Unless tenants caused some specific damage, things do age and wear, and eventually need to be replaced or repaired. The problem is, labor cost is typically the most expensive part of a repair job. While professionals are needed for some jobs, cutting labor costs out can save you big time. If maintenance required is minimal, you should at least consider whether or not you can tackle it yourself and save yourself some cash.

7.] Add Security Features and Parking
One more tip, this regarding two features modern tenants want more of in 2022. So, what could separate your updated 3-bedroom home in West Hartford from a nearly identical rental next door? First, added security. Cameras and security systems are less costly and easier to install than ever. Tenants want these in 2022 and some will even pay a premium to have them. A feeling of added security can be a huge bonus for those with young children.

American families are also driving now more than ever before. Having a garage or covered parking options is a boost for tenants with higher-end vehicles. Enough space for the whole family to park too! Premium features like covered parking and more security, when highlighted correctly in your marketing, will help lock in that top rental rate you're looking for.

Go Ahead, put these seven strategies into action now and see your returns grow month to month at your single-family rental property. And, if you’re ever feeling overwhelmed with management, give our professional property advisors a call at 860-200-3331 .

What to Look for at Your Rental Property Inspections

Tue, 12 Jul 2022 14:20:13 GMT

What Should Landlords Be Looking For at Inspections?

Inspecting a rental property is an important practice for landlords. Typically, they are done at least once during a tenant’s lease period and when tenants move out or in. Their main purpose is to help the landlord determine how much of the security deposit should be returned to the tenant. Inspections can also save the landlord from bigger and more costly long term repairs by allowing them to monitor their property regularly.

Let us tell you more about how and how often to perform rental inspections so you can save yourself that valuable time and money. Plus, we’ll tell you the simplest and most valuable tool landlords can use at move-in and move-out inspections!

What Should I Look for at the Rental Inspection?

All landlords and property managers should have a checklist handy for their rental inspections! It makes sure nothing gets skipped over, and allows you to conduct inspections efficiently to disturb tenants as little as possible. You are looking for signs of any damage done to the property and keeping any eye on items that need to constant maintenance. Here is a sample of the things we look for during an inspection at our managed properties:

Doors and windows, check seals and locks are operating correctly
Blinds & shades
Floor, wall, and ceiling damage
Appliances not damaged and operating correctly
Heating and cooling systems running efficiently
Leaks or interior water damage
Mold or mildew, pests
Pet damage
Smoke detectors, etc. working
Electrical outlets, lightening, wiring
Overall condition of the unit

How Often Should I Inspect My Units?

Robert C. White & Company’s professional property managers inspect units upon move-in and move-out and typically once per year with tenants in place. If you have good tenants in your property, this frequency is usually enough to keep yourself informed about any long term maintenance issues and ensure your tenants continue to follow the terms of their lease.

Whether you plan on doing inspections once every six months, once a year, or only with move-ins, it is wise to write them into your lease agreement. Setting expectations is the easiest way to avoid confusion or confrontation with your tenants about inspections in the future.

How Much Notice Should I Give and is there a Limit on Inspections?

This varies from state to state, so landlords outside of Connecticut reading this should talk to their local regulators or legal counsel. Here in CT, there is not technically a limit on the number of inspections that can be performed in a year, but tenants do have a right to “quiet and reasonable enjoyment" of the property. Managers and landlords in this state must give at least 24 hours notice before entering a property to inspect as well.

As mentioned above, it’s a good idea to put specific dates and times of rental inspections in your lease agreement to avoid surprising tenants. It’s also a good idea to explain why a particular inspection may be taking place and communicate clearly in the lead up exactly when and how long you’ll be present for each inspection. Legal action can be taken against landlords that fail to give proper notice, so be sure you’re following local law.

What if a Tenant Prevents an Inspection?

A landlord who has legally requested an inspection of a unit cannot be refused entry. If tenants do refuse entry multiple times, then you may need to get legal counsel involved to advise you at some stage. Inspections protect the landlord and their investment, so make sure you are able to perform them! A tenant who will not allow for simple inspection is often not abiding by terms of the lease anyway.

Video Inspections - The Most Valuable Tool

When a unit is vacant from a tenant just moving out, video documentation is the most valuable tool by far! Property managers and landlords that take detailed video of the rental unit before the tenant moves in and after the tenant moves out have something concrete to point to if damages are ever disputed. If an inspection that occurs after one of your tenants moves out shows that the unit is in considerable disrepair compared to when they moved in, the landlord has more protection with video evidence.

When it comes down to it, your inspections should be:

- Performed regularly

- Performed by giving the tenants proper notice (no surprises)

- Made to disturb the tenant as little as possible

- Documented with a checklist, and even recorded on video when vacant

- Thorough, but not invasive

Good luck next time you go to inspect one of your rental properties! And if you think you may need help from a property manager, you can contact our team here any time --> Contact Robert C. White & Company or call 860-200-3331 .

Solutions to Improve Your Lease Renewal Strategy

Mon, 13 Jun 2022 15:13:02 GMT

Solutions to Improve Your Lease Renewal Strategy

Good landlords understand that lease renewal is almost always a better option than searching for new tenants! Searching for tenants means time and money spent marketing the unit and screening applicants, and the added cost of a possible vacancy. Without a smart lease renewal strategy, you’re at risk of losing hundreds if not thousands of dollars in revenue while you hunt for quality tenants. Robert C. White & Company has put together this list of strategies to better position you for lease renewal success!

Here in June of 2022, we are still seeing Connecticut residential rentals are filled relatively quickly compared to years before COVID, but the housing market is changing, and tenants are being to test the waters again. Let's see if we can keep them in place, even if we are asking for a rent increase.

Request renewals at least 60 days out The first thing you should be doing to increase renewal potential is to start your request at least 60 days out! Well qualified tenants can find another unit easily, so contact them early to open lines of dialogue and see what you can do to improve their experience and get them to sign on for another year or more. Most landlords and property managers won’t reach out until approximately 30 days before the end of the lease, leaving less time to prepare marketing and maintenance if you don’t resign the same tenants.
Require pre-move-out notice of at least 45 days In your lease, it also makes sense to include language that holds tenants accountable for giving proper notice upon move-out. We suggest that landlords include a clause in their lease agreement that will automatically renew the tenant at the same rate for a year, or go month-to-month at a premium monthly rate. With a rent premium, you’re more insulated from the dangers of a month-to-month situation, where a tenant decides to leave in the off-peak rental season.
Make capital improvements Another fairly straightforward point is that looking to make capital improvements whenever possible will keep your tenants happier! If you’re making small improvements year after year, you’ll satisfy the tenant’s desire for improved living conditions with less of a chance of them moving on to something better.
Tenant surveys to find areas of improvement Want to improve the tenant experience? Surveys are a highly effective way to measure satisfaction and gain useful feedback from those that live at your property. Consider asking questions like has it been easy for you to pay rent and connect with us on maintenance? Are there small areas of improvement that would make you consider resigning at the same rate or paying slightly more in rent? Are you satisfied with the condition of the unit you’re renting? The answers will help you evaluate your tenant’s experience, analyze and make improvements, and hopefully retain them long term!
Minimize rent increases If your investment property is in good financial health, think about renewing tenants at a similar rate to what they are currently at! As we mentioned above, searching for and screening new applicants is always going to come at a cost, especially if the search results in a month (or more) of vacancy. Good tenants are hard to come by, so do your best to keep them by holding at a competitive rental rate. Robert C. White & Company typically recommends our owners seek a 1-3% rent increase a year.
Constant contact during the management process The lease renewal process, in reality, begins the first day a tenant moves in. For landlords to expect more lease renewals, they must create an enjoyable tenant experience. How do we do this at Robert C. White? By being a constant in their life! We find a way to touch base with tenants immediately after move-in (next day), two weeks later, and then monthly as they continue to rent. Keeping open lines of communication brings the tenants peace of mind and won’t let them feel forgotten! It also means that you are always informed on the condition of the unit and any urgently necessary fixes, as well as repairs that may be required soon.
Align leases with seasonality to make sure you’re in peak rental season Aligning leases with peak rental season can do more than lock in a top rate for you, it may also give you a better chance at lease renewal. If a tenant comes to the end of their term in peak rental season, they will be searching at a time when other units are at their peak price too, and may choose to save a few pennies by staying put!
Open pathways to other properties you own This suggestion is for landlords that own multiple properties (even better if you have multiple property types). While you may not be able to “renew” every tenant lease in their current property, you still want to retain the best candidates. If quality tenants give their move-out notice, see if you can push them into another property that you own! Even if you have to offer a security deposit special or take a small hit on the rental rate at your other property, it may make sense to lock in high-quality tenants.

There you have it! Simple solutions to improve your lease renewal strategy right now. RCW is working to build a community of landlords and property managers that treats tenants with care and increases their ROI at the same time! If you have success using any of these tips on your lease renewals, please leave us a comment to let us know how you found peace of mind. And, if you're looking for help from a leasing agent or property manager, please reach out through the link below.

Renting to College Students: What You Should Know

Thu, 12 May 2022 11:54:28 GMT

The Pros and Cons of Renting to College Students

Rental properties located in college towns & cities can be fantastic investment opportunities. The thing is, many landlords overlook or pass on these areas because of the type of properties and tenants they perceive to be there. College students are typically young, unemployed, immature, and don’t have a credit or rental history! How is a landlord supposed to work with that! Well, even with all that, renting to college students still presents benefits to the savvy landlord.

The Benefits
1) Recurring High Demand in Area

Maybe the nicest thing about owning rental property in a university or college town is that you can guarantee yearly demand for housing. While the cost of secondary education has risen, there are still more students attending college now than ever before, so the demand for housing near campuses isn’t going anywhere yet. College students typically lock in housing well before the school year begins too, so landlords can often sign leases in advance of a vacancy.

2) Possibility of Higher Rents

Rents have gone up across the board anyway, but why do college students/rentals make it possible to charge even higher rents? First, it’s because proximity to campus is in high demand. But there is also the fact that landlords owning college rentals can rent them out room by room. So where a 3 bedroom unit rented to a family might bring in $1,500/month, that same home could be rented to three separate individuals leasing their own “room” for $750/month each. That would net you an extra $250/month right there!

3) Low Marketing Costs

With the high demand for rentals in college towns, there is usually a lower cost to market your units as well. Colleges usually have an off-campus housing site where you can list your property for free, and signs/word of mouth work quite well in a more compact and connected community like a campus. You also won’t need to impress them as much with professional photos or over-the-top descriptions! Keep your marketing simple and cost-effective.

4) Stable Source of Rent

If we’re honest, most students don’t pay their rent while attending college or university! They typically receive a financial aid package or parents/family foot the bill. While generally speaking you would not want a non-paying tenant, in the case of college students, these other forms of payment are often more reliable! If you rent-by-the-room as well, you will almost always be guaranteed some rent coming in, even if one of the tenants becomes a payment problem.

5) Less Frequent Repairs & Upgrades

Students don’t need a whole lot of upgrades of fancy do-dads. They need Wifi…and a microwave oven! Seriously though, an investment property in a college area will generally need to do fewer updates and repairs to get tenants in. College kids don’t need the latest kitchen and bathroom updates, which over the years will save you time and money. College students usually just have lower expectations about what they are renting.

The Downsides

At Robert C. White & Company, we manage a few college area rental properties for our owners and they tend to do quite well! While there are many positives to consider, here are two potential downsides to owning investment property near and renting to college students:

1) No Rental History or Experience Maintaining a Property

“These kids have no idea how to take care of a house, how can I let them rent this place?” A typical sentiment for investors and landlords. The thing is, this isn’t as big a deal as some think. For one, as we mentioned before, college-age tenants don’t have very high expectations, so if there are scuffs, dents, and dings on the wall, you can get by without repairing or updating the unit as often. You should also require a cosigner for any college renter, which gives you a bit of added protection as the parent is now financially responsible for the lease and abiding by its terms, like not destroying the place.

2) Higher Turnover Rates

Renting to college students also means higher turnover rates! You may get a year or two renting with a particular student or group of students, but you can prepare for that! The best way to make up for this is by having a tried and true marketing plan whenever a vacancy occurs! You should also be able to lock in higher rental rates for individual rooms, and that extra rental income can help keep your investment cash-flow positive if and when you have to deal with multiple vacancies at the same time!

The Scoop

All-in-all, there are a lot of good things about renting to college students! There is high demand in the areas they are searching for, rent is better guaranteed through financial aid or parents, and you can usually charge 10-20% more in rent. Don’t count out investing in a university town just because you’re wary of the students.

And, if you don’t want to manage on your own anymore…you could always give the professional property managers at Robert C. White & Company a call.

(860) 200-3331 to reach our property advisors directly!

5 Great Connecticut Towns and Cities for Residential Real Estate Investors

Fri, 22 Apr 2022 13:36:14 GMT

Consider These Town & Cities For Your Next CT Investment

Clients and customers are constantly looking for advice about what towns and cities they should invest in to succeed. As property managers though, we don’t think about strictly profits when we recommend a town or city to invest in…we think about your peace of mind! How easy will it be to fill vacancies? Is the location desirable for renters now? And will it continue to be in the future? All of these questions and more should be asked before you purchase any rental property, but here is a list of five Connecticut towns and cities that offer great investment opportunities for residential real estate investors!

West Hartford

West Hartford is one of the most vibrant towns in Connecticut and an excellent location to own residential rental property. Bordering CT’s capital city of Hartford means that West Hartford is close to some of the state's largest employers, such as Hartford Financial Services. This immediately makes it easier to find relocating renters with the right qualifications to match! In addition to being near the capital, West Hartford has many fantastic shops and restaurants to attract the locals. Robert C. White & Company manages multiple rental properties in West Hartford, and filling them quickly with good tenants has never been easier than it is right now. Location, local amenities, and also great rental rates to generate income…what more could an investor ask for? Consider West Hartford.

Milford

Milford is another lovely Connecticut city with over 14 miles of coastline to it’s name, the most in the state! The city has also grown rapidly to over 50,000 people over the last few year. With access to Route 95 and trains taking you right directly into NYC or New Haven, Milford is quite a desirable location. Rents in MIlford are some of the highest in New Haven County too, with the average two bedroom apartment renting for more than $1,500/month in 2021. With many predicting rents will continue their steep rise this year, it makes Milford a great city to search for investment opportunities.

New Haven

According to RentCafe, over 45% of the city of New Haven’s population are renters, which makes this a great place to consider residential investment properties! New Haven is also home to many colleges and universities including Yale, The University of New Haven, and Quinnipiac. Yale New Haven Hospital is also here and is a major employer attracting tons to medical professionals to the area each year. All that said, there are plenty of qualified tenants in this city! Properties near to major employers downtown or the universities can also bring in a premium because of the limited availability of units in the area. For a quaint 3 bedroom rental unit that Robert C. White & Company is currently managing near Quinnipiac, we’re able to rent the rooms separately at nearly a $500/monthly premium for our owner!

Fairfield

Fairfield is a smart place to invest in residential rental property because of it it’s lively downtown, great public amenities, and local demographics. For one, Fairfield is the head of Fairfield County, the wealthiest in the state of Connecticut. With higher annual household incomes than the rest of the state, it means renters in Fairfield and the rest of the county can typically afford more. In 2014, Money Magazine also listed Fairfield as one of the top 50 towns and cities to live in the entire country. Lots of people want to live here, and that means not only good rental returns on the investment property you own today, but likely strong future appreciation when it’s time to sell. Fairfield also has a prime location along the coastline with access to Route 95 and trains to NYC, making it a great place for commuting workers to live and rent.

Stamford
Great rental rates and a high percentage of renters vs owner occupied units… both can be found in Stamford, now Connecticut’s second largest city! Here, a typical two bedroom rents for an average of $2,200 dollars per month (though that’s not a problem for most of the high earning folks in the area). Again, these coastal towns and cities have become more desirable post pandemic, especially for folks that work in New York, but are tired of being confined by it. While finding residential investment property can be difficult here the rental rates are great, location is desirable, and you’ll likely never spend much time in vacancy…cha ching!

Looking for Opportunities in Connecticut?
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10 Things Tenants Look for In a Rental Property (2022)

Thu, 24 Mar 2022 18:38:45 GMT

The Best Rental Features to Attract Quality Tenants Are...?

In 2022, what conveniences & amenities are tenants looking for? Well, we specialize in single-family homes here at Robert C. White & Company, but do handle every type of rental property. When it comes down to it, we’ve got a good idea of what renters are looking AND asking for. From feedback we'eve collected at showings, to tenants surveyed after their lease ends, here are 10 things we know most modern renters are looking for in a rental property!

1. Good Location
Location, location…right? Most tenants want to be in the heart of the action, especially young professionals! Living in a well connected and accessible city or town makes life more convenient and allows them to feel like a part of the community, even if they don’t have permanent roots. While you can’t change the location of a rental property you already own, your next (or first) investment property might best be found in a neighborhood with good walkability and amenities close by. The nearer to grocery stores, bookshops, restaurants, etc., the more competition there will be for your properties and the higher rents you’ll be able to bring in!

2. A Safe & Secure Unit
Having a safe and secure place to live is also vitally important to tenants. Location of course plays a factor here, but there are other steps landlords and property managers can take to make their units feel more secure for tenants. Adding floodlights and other outdoor lighting to parking and walkway areas, installing security cameras around entrances, and changing locks or entry codes frequently are just a few of the things landlords can and should do. If a tenant feels safe and secure where they live, they’ll not only be willing to pay more but are likely to stay longer.

3. Online Rent Pay Option
This is a modern convenience that most tenants are after! You can pay for pretty much anything you want online these days, and tenants feel rent is no different. Asking people to write checks and place them in the mail is outdated and less efficient for all parties, and there are plenty of online tools available for landlords to collect rent away from the traditional “check-in-mail” method.

4. Expected Move-In Condition

Don’t make promises you aren’t going to keep. A property's move-in condition is important to every tenant, no matter how much they pay in rent. You must be transparent regarding people’s expectations for your rental property. If you aren’t going to paint before someone moves it, let them know up front. And of course, this works the other way as well. If you do tell your soon to be tenants that you’ll fix their extra toilet before they move in, get it done. Meeting expectations is the easy way to satisfy your tenants.

5. Updated Appliances

Kitchen appliances make a big difference for many groups these days. Our agents have shown properties with an old (but functional!) stove from the 80s and then had the prospective tenant ask them…”is that thing still working?” and “ is the owner going to get a new one of those?” Upgrading the stove, dishwasher, and fridge may be just the facelift a rental property needs to close tenants quickly and take in a bit more in revenue.

6. On-Site Washer & Dryer
Having a washer & dryer on-site at a rental property is much more common now. Being able to do laundry at your home is a major convenience, one that can easily bring in $50+/month more in rent revenue. For many, especially families of renters, this can be a complete deal-breaker for them. If you don’t have on-site laundry now, consider adding it ASAP.

7. Designated Pet Area

According to the ASPCA, over 60% of renters have a pet of some sort! With such a high percentage of the tenant pool owning pets, landlords would be a bit foolish to refuse them altogether. Instead, by creating designated pet areas outside their rental properties, owners can cater to and screen for good pet owners. Accepting and having a useful outdoor space for pets is a great way to increase your tenant pool and maybe charge more in rent!

8. Parking Options
The American Census data from 2013/14 shows that over 85% of American workers commuted to their job that year. Even if this data isn’t perfectly accurate for every town and city, we assume that with the pandemic, workers commute 20% less, which still leaves more than half the workforce using a car daily to get to the office! Having parking options is important and can always bring landlords a premium.

9. Extra Storage Space
Whether they’re renting a one-bedroom apartment in a big building or an entire single-family home, renters appreciate extra storage space. Most tenants have more things than will fit in a typical rental property, so having a storage shed, designated basement space or attic can be a major draw for those folks. If you already have storage space in your rental property but haven’t highlighted it before, add it to your marketing next time for a boost.

10. Open-Plan Living
A subjective taste, of course, but open floor plan living is becoming more and more popular. Renters that have open and connected spaces can be flexible with their furniture, layout, and functionality. Remember too that people are more likely to work from home these days, so having a dynamic and multi-use open space for an office and other tasks is ideal.

6 Real Estate Lessons We Wish We Knew Before Investing

Thu, 17 Feb 2022 13:53:43 GMT

Learn These Investing Lessons Early, Then Succeed!

At Robert C. White & Company, we have licensed agents and property managers that are also real estate investors themselves. Their personal experiences allow them to offer unique insights and lessons that they wish they’d learned sooner! So, after polling around the office, we’ve put together a list of 6 critical real estate lessons we’d wish we’d known before we started investing! Take a few minutes to read below in order to save yourself time and money as you start your real estate journey.

1. House Hacking is the Perfect Way to Start Investing

If you’re unfamiliar with the term “house hacking,” it’s actually quite a simple way to enter real estate investing. The idea is to buy a multi-family property, live in one of the units yourself, and rent out the rest. By renting out the additional units at your property, the tenants effectively help to pay a large part (or all) of your mortgage! There are a host of other reasons that make house hacking great as well. Firstly, by preparing to live in your property, you can get better financing rates and options from lenders. Being on site at your first rental property will also give you a hands-on introduction to management.

And one other trick to mention…there are actually options to house hack in single family properties too! If a home has an additional dwelling unit (called ADU’s for short) - like a basement apartment or an in-law suite - the owner can bring in additional income and “house hack” that way to start.

2. To Turn a Profit, You Need Efficient Management

The fastest way to make money at your income property is to become efficient in your management and leasing processes! The biggest revenue killers for investors are prolonged vacancies, evictions, failure to collect rents, and excessive tenant damages. If you don’t have the right systems in place to manage these things, you’ll start off losing money. Some owners decide to hire a professional property manager for these very reasons.
Whether you're self-managing or have help from professionals, the most important thing when it comes to property management is having a solid tenant selection and retention program. Good tenants have fewer late payments, offer lower chances of eviction, have lower turnover rates, and take better care of properties. Solid tenant screening and retention strategies help to avoid the revenue killers we mentioned above.

3. Build a Trusted List of Vendors/Contractors

Want to save yourself time and money from the moment you start investing in real estate? Build a trusted list of vendors and contractors as quickly as possible! The faster you can find and build good relationships with plumbers, carpenters, cleaners, and others…the better. Being a landlord and managing property requires you to be on call for maintenance and emergencies. When needs do arise at one of your properties, you’ll want to have someone that will respond quickly and get the job done right the first time around.

4. Keep an Emergency Fund

How much cash is enough? Do you really need $10,000 in emergency funds for your rental property? The short answer is, no. And the more cash you hold onto, the less work it’s doing for you in other investments. If you’re buying your first investment property, you won’t necessarily need to have a lump lying around. $500 might be cutting it short, but no need to have more than $2,000 or $3,000 aside for your property emergency fund. This small reserve means you're ready anytime repairs are needed or your tenants are late on rent for a period. It could also help cover the cost of something like a new furnace when larger items like that inevitably break. Keep an emergency fund, but not too much.

5. Don’t Buy in Worst Neighborhoods Just Because They’re Cheap

Just because a property is offered at a cut-rate deal, doesn’t make it a good investment. Chances are, a property listed at a discount in a shady part of town, isn’t all that tremendous. If you start investing in real estate in undesirable areas, your rental revenues will suffer and tenant selection and retention will be more difficult. As we mentioned in section two, these things make managing and profiting from real estate more difficult.

Investing in rundown neighborhoods because they are the cheapest entry point or you think you can “change the neighborhood,” tends to catch up quickly. To give yourself the best chance as a first timer, you’ll want to be able to attract quality tenants that respect your properties and are unlikely to miss rent or become an eviction problem. There are certain investors that can handle high turnover and eviction rates, but they have deep pockets and unique processes in place to ensure they still turn a profit. If you’re looking for your first rental property, make sure it’s in a solid location.

6. Learn to Predict Cash Flow and Profitability Accurately

Investors without experience tend to struggle predicting cash flow. Cash flow is the difference between a property's incomes and expenses including debts, and of course…you want to be cash flow positive! If you can figure this one out before you ever start investing, you’ll ensure a profit from the start. Inexperienced investors will calculate cash flows as though things run smoothly at the property 12 months of the year…but what happens when you have a prolonged period of vacancy or your tenant does $2,000 in damage when they leave? If you didn’t forecast for these things, what looked like a profitable investment before you purchased it, can quickly turn into a losing one. If you’d like to learn how to approximate and calculate cash flow in more detail - CLICK HERE .

Well, there here you have it! 6 real estate lessons we wish we’d known before we started! If you can figure this stuff out before you buy your first rental, you'll be in excellent shape to start making money from day one. Happy investment hunting to you from the Robert C. White Team! ��

Need Help With Your Investment Property Search?

Contact our Rental Advisors directly at 860-200-333 1

What is Residential Property Management?

Mon, 07 Feb 2022 15:51:08 GMT

What makes residential property management different?

Residential property management companies oversee "income" or "rental properties" on behalf of an owner. In practice, a residential property manager is a “landlord-for-hire,” one that takes over all of the day-to-day responsibilities an owner would typically do on their own like collecting rent and scheduling repairs. The types of properties they manage tend to include single-family homes, individually owned condos, townhouses, or small multi-family buildings with less than 6-8 units. Now let's discuss exactly what you'd expect of a residential property manager!

What responsibilities does a residential property manager typically take on?
Below, you’ll find a shortlist of responsibilities that a “landlord-for-hire” will normally take on their owner’s behalf. This is not an exhaustive list, as many residential managers do offer additional services to those listed here:

Marketing - Profitable rental properties don’t stay vacant for long! A professional property manager will have a marketing playbook to get your units marketed quickly and efficiently.
Leasing & Tenant Screening - Marketing the unit is of course step one, but landlords must also be able to screen and select the best tenants possible! A residential property management team should have systems in place to screen tenants effectively and ensure they are qualified before allowing them to rent your units.
Rent Collection - Sometimes, collecting rent and other fees from tenants can be a hassle. A licensed property manager will have collections and follow-up processes to make sure you're receiving all income from your rental properties!
Maintenance & Repairs - Some residential property managers have an in-house maintenance team to take care of these issues, while others will hire outside contractors on the owner’s behalf. Either way, a professional management team should have no issue taking care of repairs and preventative maintenance at their properties.
Inspections - Landlords that inspect their properties frequently can keep a constant eye on maintenance and on tenants that are caring for the units they live in. Most property managers you hire will have a regular inspection schedule to do just that at your properties.
Evictions - Have a problem with tenants disturbing other residents or not paying their rent? A property manager can assist with filing and processing an eviction. They can also point you toward reliable legal counsel to make sure any necessary eviction moves forward as quickly and cost-effectively as possible.
Financial Reporting - The last major responsibility that most residential managers will take on for you is financial reporting. Keeping track of expenses and receipts can be tricky, and if not done correctly, can hurt you come tax season! Working with a professional PM can ensure you get your yearly financial reports done right at your rental properties.

How does a residential property manager differ from commercial or big building managers?

A residential property management team is quite different from commercial and big building management teams. Firstly, they focus on smaller (usually individually owned units/buildings). Here at Robert C. White & Company, we specialize in the management of single-family homes, condos, and town-homes, and the experience that we have with these units gives us an upper hand over other property managers who aren’t as familiar. Unlike most commercial property managers, a residential property manager is not onsite. Instead, they typically have a central hub within 30 minutes or an hour of all managed units. Because residential managers are dealing with tenants renting a home, they have to be on call 24/7 in case emergencies arise too!

When to use a residential property manager?

You’d like more time to explore other investment opportunities. Use a property manager to take over typical landlord responsibilities while you look for the next venture!
You’re tired or too busy with day-to-day tenant requests/maintenance oversight. Use a residential management team to remove the hassle.
You live more than 50-100 miles from the property. Consider a property manager that is close by to be able to observe and monitor efficiently.
If listings and filling your units becomes too difficult or time-consuming, a property management team can set an effective rate quickly and attract qualified groups with their marketing expertise and reach.

Of course, there are many other reasons you may want to work with a residential property management company… so give us a call if you have questions!

Connect Directly to a RCW & Company Residential Property Advisor
860-200-3331

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Contact-Us

Landlord's Guide to Security Deposits | CT Edition | Updated for 2022

Tue, 18 Jan 2022 18:33:47 GMT

EVERYTHING LANDLORDS NEED TO KNOW ABOUT SECURITY DEPOSITS!

Updated & Revised Jan 2022

What is a Security Deposit?

Definition: A SECURITY DEPOSIT IS ANY ADVANCE RENTAL PAYMENT OTHER THAN AN ADVANCE FOR THE FIRST MONTH'S RENT OR A DEPOSIT FOR A KEY OR SPECIAL EQUIPMENT. A SECURITY DEPOSIT REMAINS THE TENANT'S PROPERTY BUT THE LANDLORD HOLDS A SECURITY INTEREST IN IT. BY LAW, SECURITY DEPOSITS MUST BE KEPT IN AN ESCROW ACCOUNT IN A CONNECTICUT BANK.

Security Deposits in Connecticut: Do's & Don'ts

Landlords Beware: Fines and Imprisonment

Do you know the legal penalties for not dealing with security deposits correctly?

If a landlord does not ...return a security deposit with interest or provide written notice of damages within 30 days, the landlord may have to pay the tenant 2x the amount of the security deposit.
If a landlord does not...keep security deposit funds in an escrow account, the landlord is subject to a fine up to $500 & 30 days in jail FOR EACH OFFENSE.
If a landlord does not...pay interest on security deposits annually, the landlord is subject to a fine of up to $100 FOR EACH OFFENSE.
These previous 3 items sound painful, do they not? Here are a few comforting items:
Landlords do not have to pay interest on a security deposit in any month where a tenant was more than 10 days late paying their rent (BTW Connecticut allows for a 9 day grace period... so on the 11th RENT IS LATE)
Landlords with disputes can file a suit in small claims court.

Security Deposit Interest: How Much is Enough?

Who determines how much interest one has to pay on security deposit funds? This one’s easy! The State Banking Commissioner sets the interest rate annually, which is known as “the average commercial bank’s savings deposit rate.” In the year 2022, the Commissioner has determined the interest rate for rental security deposits to be .06%. This percentage is a decrease from the rate set in 2021 (.08%) and before that in 2020 (.15%).

Another thing to note regarding interest on security deposits, is that tenants forfeit their interest on any months they are more than 10 days late on rent. That is unless the rental agreement has other late charges for overdue rent payments.

Disputes and Security Deposits: First Steps

What options are there for resolving disputes?

At the Connecticut Department of Banking, a full-time employee is available to answer questions on rent security deposits in the state office. The Banking Commissioner may investigate complaints, issue cease and desist orders, or refer matters to the Attorney General's Office for legal action. For further information or to file a complaint, please visit the Connecticut Depart of Banking Site Here .

Assessing Damages and Return of Security Deposit

Upon tenant move-out, always inspect the unit BEFORE returning the security deposit. If you fail to inspect you’ll have no recourse. One way to avoid an unfair damage assessment is to take a pre-move-in and move-out video to document the unit conditions (these walk through videos can and should be shared with tenants!). This way you can compare the unit before and after a tenant’s stay to determine whether or not they will have the security deposit returned to them. Reminder: in the state of CT, the security deposit must be returned, or a written notice of damages provided to tenants, within 30 days.

Tired of Dealing With Security Deposits?

Dealing with tenant security deposits is one of the many things Robert C. White & Company takes care of for owners of single-family homes, condos, and small multi-families. We have it down to a science because it is what we do. Our owners don't have to worry about opening escrow accounts, calculating how much interest they need to pay, conducting move-out inspections, or abiding by timeframes set by state law... peace of mind is what we provide!

Have immediate questions about how to handle your security deposits or? Call our property advisor directly at (860) 200-3331 . We are always happy to help!

Does a Property Manager Make Sense For You In 2022?

Thu, 06 Jan 2022 17:48:40 GMT

What Do Property Managers Do? How Can Owners Benefit?

What is Property Management? What Do Property Managers Do?

If you’re already a landlord then you probably have an understanding of what property managers do! We’re like you, accept that we’re a “landlord-for-hire,” not for our own property, but for investors that don’t have the time or experience to handle their own day-to-day management!

Defined simply, property management is daily oversight and operation of residential and commercial real estate by a third party, on behalf of a property owner. Property management is still a relatively young industry, and one that many investors and landlords are yet to consider seriously. Property managers typically specialize in a property type (condos, single-family homes, apartments, commercial) and have a defined service area to be close to the properties they manage.

Full-service property management usually includes marketing the property, collecting rent, screening tenants, managing maintenance or repairs, inspections, and financial reporting. Additional service and protection options are often available to the client as well, but deciding to work with a qualified professional usually takes away 95% of the management burden!

What are the Benefits of Hiring a Professional?

Decreased vacancy - Experienced property managers have a pre-built marketing playbook and understand how to set the perfect rental rate to attract quality tenants quickly.
Better quality tenants/screening process - Some landlords don’t have the time or the ability to thoroughly evaluate tenants applications. Property managers have the capacity to run credit, eviction, and background checks, plus verify and follow up with previous landlords. Choosing high quality tenants is an important part of owning rental units and property managers have better screening processes than individual landlords.
Lower cost + turnaround time on maintenance - Whether a property manager has an in-house maintenance team or hires out repair jobs to other contractors, they’ll almost always be able to find better pricing and turnaround times. This is because property managers form long term relationships with plumbers, electricians, and other contractors that allow them to negotiate rates and rely on them with more immediacy.
Smarter collections process - Ever had trouble collecting rent from a tenant? How much time and effort did it take? How many phone calls/emails? Property management teams have teams and automated systems in place to handle outreach and follow-up both early and often!
Legal knowledge - While your property manager will never act as legal counsel if you have disputes at your properties, they have the experience and knowledge to help you deal with any scenario that may arise. They’ll be able to offer early advice and point you toward reliable legal counsel if that is what’s required.
Personal Time - On a personal level, hiring a property manager can help you reclaim your time and relieve you of the stress of self-managing. Landlords that do it themselves are basically on call 24-hours a day in case of emergencies at their properties. This can be a heavy burden, especially when career, family, and other important things in life are moving.

How Much Does Property Management Cost?

Management Fee - Most property managers operate with a monthly management fee based on a percentage of gross rents, typically charging 8-15% of what is collected. There are also some that offer a flat monthly fee no matter the size, type, or income to the property…but they are more rare. When you are shopping for a property manager, be sure you understand the full details of the agreement before you move forward, because there is a significant difference in the responsibilities a manager will take on depending on the service package or company you choose. With the monthly management fee, 99% of property managers will collect the rent for you each month, but will they also tackle maintenance items without additional charges, or guarantee the tenants they place in your units?
Leasing Fee - A leasing fee is another thing you can expect as a property management client. This fee is paid any time the property manager must fill a unit that has become vacant and is usually between 50 and 100% of one month’s rent. Filling a vacancy is the most difficult part of managing a property, which is why all property managers charge a leasing fee in addition to their monthly management fees.
Lease Renewal Fee - One fee that varies more widely from company to company is a lease renewal fee. This fee, usually between $250-$1000 or represented by a percentage of the rent, is charged to owners when a tenant decides to renew their lease for a year or more.
Maintenance Fee - Depending on their set-up, some property management companies include the oversight and hiring of maintenance contractors in their management fees. However, some that operate on the lower end or change low flat rates, do not include maintenance oversight. In these instances, anytime a repair is needed, additional fees will be charged to the owner. If there are additional charges for managing maintenance and repairs, they are commonly added as a percentage of the cost of the work being done (around 10%).

How Do I Start My Search?

The easiest way to start is by hopping online and searching for terms like "property manager" or "residential property management". You'll want to look for property managers that are within an hour of your rental property at most, because proximity is important to management. You should check out reviews on Google, Yelp, and elsewhere... and once you’ve found a few highly rated options, you should also dig through their websites to determine whether they can manage the specific type of property you own and what kind of services are included for their fees. Of course, cost is a major factor to consider, but a good property manager will virtually pay for itself!

Want More Info About Hiring A Property Manager?
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Explained: What is House Hacking... And Could It Work For You?

Wed, 08 Dec 2021 17:47:01 GMT

Let's Talk About House Hacking and it's Tremendous Benefits!

Defining House Hacking

Today’s focus is on “House Hacking.” Whether or not you’ve heard the term before, we’ll take time to define the concept, explain the benefits, understand the responsibilities, and provide some actionable steps for those who see an opportunity and want to get started! There are lots of ways to secure your first investment property, but house hacking is becoming a particularly lucrative and popular way to kick it all off.

First, let’s define the term ... House hacking is when an individual or group purchases an investment property intending to live in the property themselves and generate rental income from additional units/space. Most of the time, this involves the purchase of a small multi-family building where the owner lives in one of the rental units and rents the rest to tenants. In theory, there are other ways to house hack (which we’ll mention later), but this is the most common approach...plus the benefits in this scenario can be tremendous!

What Are the Benefits?

House hacking that is done intelligently offers a myriad of benefits. The first benefit to buying a live-in investment property is the type of financing one can receive. First-time home buyers have the benefit of FHA and other loan options that require much smaller down-payments. Interest rates are also lower on most FHA loans, and there are other incentives like the potential to get money back on your purchase through closing cost credits! All-in-all, house-hackers will benefit from better financing options than those looking to purchase a single-family home or condominium.

Another big benefit of house hacking is the potential for the owner/landlord to come out cash flow positive each month! An owner is cash-flow positive when the monthly rental revenue is greater than the mortgage, taxes, and other expenses. When you think about it, being cash flow positive basically means you’re getting paid to live there! House hacking is also a great way to get started on your real estate investing journey. Living in and being a part of your first rental property can give you the knowledge and experience you need to make even better investments in the future...or to teach you that this game just isn’t for you! Either way, it’s a great stepping stone to becoming a full-fledged landlord.

New Landlord Responsibilities

The benefits to house hacking are tremendous, but it also comes with the responsibility of being a landlord. A landlord’s job, unfortunately, is not just collecting rent 12 times a year. If you’re house hacking in a 4-family building, you’ll have to manage three sets of tenants by promptly dealing with any issues they have and completing repairs and maintenance that are required. House hackers are never far from issues at their property, which does make it easier to manage… but you’ve got to be willing and able!

Properties to House Hack In…

Multi-Family Home = T he most common property type to house hack in would be a traditional multi-family building. A property with 2-3 units or more allows the landlord (house-hacker) to live in their own space while collecting rental revenue from the other apartments to offset their costs.
Renting a Room = A less frequent appraoch to house hack is simple to purchase a standard single family home and rent out individual rooms. Say you're a young couple who decides to by a 4 bedroom property because you just fell in love with it, but are only using two of the rooms actively. You can rent out individual or shared spaces for tenants/roommates to occupy. Again, collect the rent and offset your costs. As with the multi-family and other property types we mention below, you still the benefit of better financing options as well since you'll be living in your investment property to start with!
ADU’s & In-Law Suites = OK, we get it, you don't want your in-laws to live with you...but it's always an option if you're thinking about house hacking! A property with an additional dwelling unit (ADU) or in-law suite presents another potential to bring in rent revenue at a property you're also living in. While there typically is only one ADU, which means less rental revenue, if you get a good deal, it could still do a great deal to offset your mortgage and other expenses.
Air BnB = The last option we present is the Air BnB rental. While this may not fall under the typical house-hacking scheme, it has become a popular way to bring in revenue at a property that is almost totally your own!

How to Determine a Good from a Bad House Hacking Property

A good house hacking opportunity should present the owner with a chance to profit right away! Not only should you expect to build equity over the life of your mortgage, but house hackers can see monthly profits from the day they move in. This is where we talked about being cash-flow positive before. Let’s say you decide to house hack a 4-family home and live in one of the units yourself. You estimate your mortgage payment, taxes, insurance, and additional expenses will total $2,712/month. But, you also have three occupied units each renting for $1050/month ($3,150/month in total). In this scenario, you’d expect a positive monthly cash flow of $438...and that’s without you paying a dime in rent yourself! To read more about what makes a good or bad investment property, check out our article on Cash Flows and Cap Rates Here .

Final Thoughts

House hacking is an interesting and financially responsible way of getting into real estate investing. It can offer individuals and families the opportunity to acquire property with less money down and more intriguing interest rates, with the added benefit of making a profit each month too! While there are also new landlord responsibilities that come with it, house hacking also allows the owner to stay close to and monitor all the action.

If you’re considering a new investment property or want more information on house hacking options: Call Our Rental Property Advisors Here .

A Landlord’s Job: Is Rental Income Really "Passive"?

Thu, 18 Nov 2021 15:35:01 GMT

Generating Passive Income. Is It Attainable?

Being a landlord is easy, right? You get yourself a nice rental property, find good tenants, and the money starts rolling in… at least that’s how simple it can seem from the outside! But what exactly does a landlord have to do? Is the rent they collect really “passive” income that requires little to no effort? If you’re thinking about investing for the first time or purchasing another income property, there are a lot of factors to consider. Let’s take a quick look at just how passive a landlord’s income is!

Researching & Bidding on Investment Property

The first requirement to being a landlord is owning a rental property, but that doesn’t happen without searching for, bidding on, and finalizing the purchase on said property. There are some circumstances, like inheriting a home, that can turn you into a landlord overnight, but most investors start with purchase. This first step in the game can become a very timely process, and with most properties listed for sale with the help of agents/brokers, if you’re not working with one yourself, finding a property to purchase can be even more difficult.

Setting Rental Rates & Marketing

Another task that landlords must take on to earn “passive” rental income, is setting the rental rate and marketing their units. A landlord will spend time doing market research to understand local rental rates and should monitor comparable listings! If you don’t keep an eye on similar properties, you may be one of many landlords who aren’t maximizing revenues! Even if you think setting the right rate is easy, listing the unit on Zillow, Craigslist, Trulia and other sites will take up more of your time. You’ve then got to communicate with and pre-screen all the leads. There are a lot of things to get right when you first list and market your rental property!

Showings & Applicant Screening

Once a landlord gets their property marketed and receives inquiries, it’s time to show the unit and select a set of qualified tenants. Showing a property is a very time-consuming task and only gets more infuriating when the leads you scheduled with don’t show up or aren’t qualified! If you do get a set of applications on your first few showings, now you’ve got to call landlord references, run credit checks, and verify employment before you can decide whether or not to accept someone. The tenant selection process is a crucial part of a landlord’s job because good tenants make the job so much easier, but there is a lot to look for as you comb through applications and you’ve got to build that knowledge base to make this kind of income passive. You can learn about our professional screening process here .

Leasing & Rent Collection

Once you do find good tenants, you’ve also got to go over the lease terms with them and have them sign all necessary documents. Getting them to sign is usually easy, but rent collection then becomes a monthly process. Good tenants make collecting your rent easy, but tenants that become a payment problem mean more work for the landlord!

Managing Maintenance & Repairs

Maintenance and repairs are probably the most difficult and time-consuming part of a landlord’s job... and a lot can go wrong with them. Now, unless you’re a super handy landlord and have the skills to complete the work yourself, you’ll need to spend time searching out the best contractors and repairmen to get it done for you. This can be a tireless task, and even when you think you’ve hired the right company for a job, the workmanship may be below your standard or new problems could pop up while repairs are being made. And of course, hiring outside help comes at an increased cost.

Reporting & Taxes

You’ll also need some know-how or outside help to get your end-of-year reporting and taxes done right! Since most folks don’t have time to learn the nitty-gritty of the tax code, they’ll end up hiring professionals to handle that piece. While this is definitely a “passive” approach here, landlords are still a part of the tracking, collection, and documentation process throughout the year!

Working with a Property Manager?

One solution to handle all these landlording responsibilities is to use a professional property manager. The right property management team can take on each of these tasks for you, and even with their monthly fees, may end up increasing your revenue because of their efficiency and expertise!

{Click Here to Access the Ultimate Property Management Hiring Guide}

Systems of Automation?

If you’re looking for solutions outside of professional property management there are also some online/automated systems that you could implement. These systems can help screen tenants, collect rent, manage repair requests, and then some. The only thing here is that these programs can be very costly for investors with new or smaller portfolios. Nonetheless, you may find some of these systems make sense for you to use!

Want to talk with one of RCW's professional property managers?
Click the button below.

What is Prorated Rent? How Does it Benefit Landlords and Tenants?

Tue, 02 Nov 2021 14:49:28 GMT

What is Prorated Rent? Should Landlords Offer It?

What is Prorated Rent?

Let’s jump right into things and define prorated rent. Many landlords and tenants are unfamiliar with the definition, or, are confused about the benefits of using prorate rent and how to calculate it. Prorated rent can essentially be thought of as a partial rent payment. It is calculated proportionately rather than charging a full monthly price. Typically, tenants sign a lease for one calendar year, but where they do not, is when prorated rent can come in handy. Let’s continue the discussion and show you just how prorated rent is calculated!

How Do You Calculate Prorated Rent?

A prorated rent payment is based on the exact number of days that a tenant occupies a unit, rather than by the month. So, how do we calculate a tenant’s prorated rent? Here is an example calculation for a group of tenants who are moving in after the 1st of the month. First, we’ll need to find the number of days that rent will be prorated and then, the daily cost of renting the particular unit.

Example: Tenant agrees to lease from 11/10/2021 - 11/30/2022 @ $1,500/month.

Because the tenant’s lease is less than the typical twelve-month period, they’ll likely ask for a prorated amount to move in! To charge them appropriately, we need to know the number of days in the period to prorate. That number is 20 days, from the 10th to the 30th of November. Next we’ll take the number of days (20) and multiply it by the daily rental rate...but how do we find the daily rate? We do this by taking the normal 12-month lease cost - $18,000 (12 months x $1,500/month) and dividing by the number of days in the year (365) which comes out to $49.32/day. So…

20 days (length of the prorated period) x $49.32 (cost/day of rental) = $986.40 due for November

This prorated amount is what should be charged for the first 20 day period. Now that you know how to calculate prorated rent, let’s talk about the benefits it can have for both parties, the landlord and the tenant!

Benefits to Landlords

For the property owner or landlord, the benefits or prorated rent are clear. For starters, accepting prorated rent means that vacant units can be filled any day of the month, not just on the first. Without this option, landlords simply miss out on revenue! There is no greater cost to a landlord than vacancy. Secondly, landlords that accept prorated rent are offering convenience to the tenants that they will appreciate. Keeping tenants satisfied and starting on the right foot is hugely beneficial.

Landlords may also consider prorating the rent for an early move out in certain circumstances. Consider a situation where you’ve had an awesome long-term tenant that wants to move out just one week in advance. Normally, this might be a hassle, but if you had another group interested in taking possession of the unit a week early, then you won’t miss out on revenue, and can keep that tenant satisfaction rating high for both old and new groups!

Benefits to Tenants

For tenants, prorated rent is all about the convenience factor. They often have unique circumstances that affect their exact timing for move-in and move-out, so having some flexibility can be helpful. Plus, nobody wants to overpay for something. Landlords have a responsibility to be fair to tenants (and will benefit from doing so), so if someone is moving in on the 25th of November, they probably shouldn’t have to pay for the entire month!

When to Charge Prorated Rent?

There are only two places to use prorated rent, either the first or last month of a tenant’s lease. Assessing prorated rent in the last month of a lease term is easy, just take the cost per day and multiply by the number of days occupied, but what about tenants that are just moving in? What happens when a landlord requires an entire month of rent upfront, as is typical? In situations like this, where a full month is required but tenants want to move-in early, tenants typically pay the entire first month upfront and carry a balance (based on cost/per day multiplied by the number of days) into the second month, which is then charged at the prorated amount. They would then resume normal rent payments with the start of the third month.

Final Thoughts

Prorated rent usually benefits both parties. Tenants get the convenience of moving in or out when it is easiest for them, and they don’t get charged for time occupying a unit that they weren’t in. From a landlord's perspective, prorating rent at the start of a lease means increased rent revenue, and doing so at the end is a kind gesture for any quality tenants. Prorated rent gives both owner and tenant more flexibility without costing much!

Being a landlord can be a full-time job!
Connect with a rental advisor to see how Robert C. White & Company can help.

860-200-3331

info@robertcwhite.com

7 Qualities of a Perfect Tenant

Wed, 20 Oct 2021 14:41:29 GMT

"The perfect tenant makes a landlord's job easy!"
Lance Camby, Property Manager, RCW & Company

Searching for the perfect tenant isn't overly complicated, but you've got to have your focus and attention on the right things! At Robert C. White, we firmly believe that you can find the perfect tenant for any property if you screen properly and have some redundancy built it. Your perfect, dream tenant, should posses all seven of the qualities listed below; let's take a look!

1. Presents an honest application

The first step in any tenant screening process is to have them see the property and then apply for said property. To start, a perfect tenant will not be flustered by an application process or balk at small fees to apply, run credit, or process background checks. Good tenants are open and honest on their application when it comes to income level, the number of pets they have, rental history, and everything else in between. The perfect tenant is, first and foremost, honest. If you find out that an applicant has hidden something from you, deliberately or otherwise, that is a major red flag!

2. Meets income, credit, and other qualifications
The perfect tenant will make sure they meet all the qualifications before bothering to apply for your property. Whatever income, credit, and other criteria you set, good tenants will understand them in advance and won’t waste time and money applying for something they won’t get! In some instances, there may be rules that you’re willing to bend. For example, accepting 3 cats (when you specified a max of two) for an otherwise well-qualified tenant will still make sense. The perfect tenant doesn’t hide this kind of detail and is likely to accept any additional stipulations to get themselves into the property they desire, such as an increased pet fee!

For more information on setting rental qualifications read our blog post here .

3. Pays rent (and other fees) on time

This point doesn’t need much explaining. Perfect, dream tenants, will always pay their rent ON TIME. When you’re screening applicants and get to talk to a previous landlord, it’s crucial to ask about on-time rent payments. If they have a solid history, they’re more than likely to continue paying on time. This will save you time and hassle in chasing down the rent and other fees you’re owed!

By the way, even the best tenants can run into payment trouble if there is an unexpected emergency in their life. In these instances, your perfect tenant will notify you immediately and create an action plan to avoid becoming a long term payment problem. This is another place where honesty makes for a better landlord/tenant relationship!

4. Treats the property with respect
Another quality of a perfect tenant is someone that will treat your property with the utmost care and respect. While they won’t ever have ownership over your rental property, you should expect them to treat the home like it is their own. Normal wear and tear are a part of any lease term and are unavoidable. That’s not what we’re talking about here. A perfect tenant will take care of minor things on their own (tightening a loose screw on drawer handles or changing light bulbs) and be careful not to cause any major damage. This is both to their benefit and yours!

5. Is prompt in notifying you about maintenance issues

A great tenant will always notify you promptly regarding maintenance items, especially ones that could continue to deteriorate rapidly. Small repairs can quickly become large repairs that require more attention and come at an additional cost. Your perfect tenant lets you know as soon as something goes wrong so you have ample time and resources to get repairs done efficiently!

6. Follows all terms of the lease

We already discussed on-time payments, but that’s not the only part of the lease that a tenant must abide by. Your lease will probably have rules regarding pets, visitors, late fees, non-smoking, and then some. Perfect tenants follow each and every rule that is in their lease, and won’t try to slip something past you unnoticed. Terminating a lease for any reason is costly and time consuming, so find yourself the perfect tenants that you think will follow all your terms and save you that trouble.

7. Carry a renter’s insurance policy

Great, better yet perfect tenants, will always carry a renter’s insurance policy too. Here at Robert C. White & Company, we actually require it! A renter’s policy not only protects the tenant’s personal belongings in case of emergency/destruction, but can also cover damage to your property as a result of negligence. If your tenants accidentally start a house fire, their renter’s policy can cover all or some of the damages so that you, the owner, will not have to deal with that out of your own pocket. You can also read more about these renter's policies in our Owner's Guide to Renter's Insurance .

Wrapping Up

Perfect tenants aren’t that hard to come by, but to find them will require you to do your due diligence up front! When tenants first apply to your property, verify all their information with income, credit, and background checks. Remember an honest application is the first step! You should also speak directly with their previous landlord(s) to get an idea for how they treat the property and whether or not they abide by all lease terms, because it is perfectly reasonable to deny applicants who have misrepresented themselves. That said, if a tenant happens to have all seven of the qualities listed above, you're likely making the perfect choice!

Late Rent | Connecticut Edition : How to Collect Late Fees

Mon, 04 Oct 2021 20:06:06 GMT

Learn to Collect Late Fees, Legally

Each state has its own laws regarding late rent payments and whether or not owners can charge additional fees to their tenants for that tardiness. In this blog post, we focus on our home state of Connecticut. At Robert C. White & Company we’ve guided landlords and tenants through thousands of lease terms and are experienced in assessing late fees! The good news is that in this state, you can charge late fees and the rules aren’t all that complicated. Let’s also discuss the best practice for sending late rent and fee notices while keeping your tenants in line. Here we go!

For starters, the obvious
First off, landlords must make it clear in their lease exactly when rent is due each month, acceptable forms of payment, and where to submit or send payments. An owner should also be explicit through each step of the process including the initial conversation, the property showing, and at lease signing. Setting clear expectations protects the landlords interest and makes it impossible for tenants to claim surprised or shock by what is in the contract. Now that that’s out of the way, let’s talk about when rent actually becomes late in Connecticut and how to approach the situation with the tenants.

Grace period...when is rent really late in CT?

Here in the Nutmeg State, rent is late after the 1st of the month, however, there is not much a landlord can do about that until a 9-day grace period passes. The 9-day grace period in Connecticut means that tenants actually have until the 10th to submit their payment before a landlord can consider it late and charge an additional fee. Don't jump the gun!

Owners also have to be conscious of the “mailbox rule”. This rule states that if a landlord authorizes rent paid through the mail, a submitted rent payment is dated the same day as the piece of mail it was sent with! This suggests that in Connecticut, a late fee cannot be assessed to the tenant if rent was mailed prior to or during the grace period, even if it was received after the 10th.

Sending a late fee notice

The state of Connecticut has specific regulations regarding notices for late rent and charges too. If a tenant has not submitted payment by the end of the grace period, landlords must provide them with a written notice if a late fee is going to be enforced. It’s also important to note that a landlord must give tenants at least two weeks to pay the late fee once the notice is received.But even if notices weren't required by law, sending them protects your investment and keeps tenants informed!

Assessing late fees

How much can I charge for a late fee, you ask? Well, in Connecticut, there are no specific rules or limits on how much a landlord can charge for late fees! However, there have been a few critical court cases that set some precedent. The courts have decided that fees must “bear a reasonable relationship to the actual damage that the landlord sustains…” and in one instance where late fees were challenged by the tenant, the court found that 5% of the rental rate was fair to charge because of the administrative costs of monitoring the late payment, sending the notice, and collecting. You can read more on that here .

At Robert C. White & Company, we assess late fees as 10% of the rental rate. In the event one of our tenants does miss payment on 1st of the month, a late rent notice is sent the next day. Then if rent is still not received (or mailed) by the 10th, we immediately follow up with an electronic and written notice that a late fee will be assessed, how much the charge is, and how to pay it.

Wrapping Things Up

So now you know that you can charge late fees in the state of Connecticut and you understand the best practice to send notices effectively [and legally!]. Remember too that while there is not official limit to the amount you can charge for a late fee, there have been many successful challenges in the courts. Complying with the laws and setting expectations with your tenant are the two most important pieces to this process. Good luck!

Four Strategies to Fill Off-Peak Vacancies

Wed, 22 Sep 2021 13:49:23 GMT

Finding Renters During "Slow" Rental Seasons

A few blog posts back, we gave some reasons as to why your property is still vacant . This week we’re offering specific solutions to help you fill off-peak vacancies that may be coming your way soon! Typically, in Connecticut, the “off-peak” or "slow" rental season begins in October or November and lasts through March. And it’s easy to understand why, because moving through cold, sleet, or snow is quite miserable. The scholastic calendar is also a major factor here, as most families want to settle into their new home before a new school year kicks off! While most landlords already do their best to avoid off-peak vacancies by perfecting the start/end date on their leases, the situation will still arrive from time to time. So here are four simple strategies for minimizing lost rent and filling your vacancies during the off-peak months!

[1] Market Before the Move-Out

There is nothing more costly to an owner than vacancy, and yet, the biggest mistake we see self-managing landlords make is refusing to market or show their property before they are vacant! While an empty unit makes scheduling showings more convenient for the owner, one issue is that it does not allow prospective tenants to get an idea of how their things would fit in the home.

Even more useful, showing an occupied unit allows you to create what we call in the property management world, a “0 Day turn!” This is when a new tenant moves in the day after (or realistically just a few days after) the old tenant vacates. Quick turn-overs maximize profits by minimizing lost rent with each new lease...pretty sweet! We highly recommend landlords add a clause to their next lease which allows them to market and show their properties with tenants in place.

[2] Offer a Move-In Special to Qualified Applicants

Another great tactic to pull tenants in and minimize off-peak vacancy is offering a move-in special. Consider something like ½ off on the security deposit for well-qualified groups. If an applicant has good income, credit, and rental history you can be confident that they won’t do much damage to your property, in which case, reducing the security deposit is enticing to them, and you as a landlord don’t have to take a hit to rental income! If you are more concerned with damages though, you could also offer a discount on the first month’s rent. Giving a $500 credit for someone to move in on October 1st makes more sense financially than waiting and finding a tenant on November 1st. If we had two units with different owners, both renting for $1,750/month, one that fills the unit early with a rent special nets an extra $1,250 in income. ($1,750 - $500 = $1,250 as opposed to losing the entire October rent)

[3] Take Better Photos & Improve Your Marketing Description

We can’t tell you the number of times we’ve seen horrendous marketing photos from DIY landlords, better yet, how about the rental listings with no pictures at all?! It sounds crazy, but many owners don’t get the marketing right from the start because they don’t take a few extra minutes to capture quality photos. Not only is this bad practice during the hottest rental months of the year, but it especially hurts properties that are listed in the off-peak season. If you want to give yourself a chance against similar listings during slower months of the year, you’ve got to have quality photos to catch people’s attention first!

And going hand-in-hand of course with your images/video tours is the marketing description. Landlords tend to be brief with these or give out wayyyy more information than anyone needs! You don’t want folks to get lost reading your listing, but you also don’t want them calling you for answers to simple questions, like: “Is there off-street parking or do you accept cats?” These are critical questions for almost any tenant, so give them the answers they need in advance and save yourself time dealing with undesirable leads!

[4] Accept Online Applications

Our last piece of advice is; make it easy and they will apply! Not enough landlords make the application process efficient or easy for prospective tenants, and in the off-peak rental market...this only makes filling your vacancy more difficult. Listing your property online is straightforward and so is giving people the opportunity to apply online! Some listing sites, such as Zillow, have already rolled out their own tenant screening/application process, and there are plenty of other low-cost services available online. Put yourself in the renters shoes, if you were choosing between two identical units, and one owner made applications and electronic communication accessible while the other needed to be met in person for every interaction, which would you choose? Most of us will end up taking the path of least resistance.

A Final Word

Now that we’re nearing the off-peak rental season here in CT, you’re more prepared to find tenants efficiently. If you’ve got a vacancy that’s coming soon at one of your properties, you can use these four strategies to make sure your units are filled before the competition. We’ll leave you here now with one extra tip to fill those off-peak vacancies , and that is to write an accurate but descriptive headline! One of Robert C. White & Company's current listings is simply titled, “3 bedrooms single-family home with private yard,” nothing fancy, but nothing to confuse either! Good luck landlords.

Want to Learn How to Screen Tenants Effectively or Choose the Right Property Manager?
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Maintenance vs. Capital Improvements: And Why It Matters to the IRS

Tue, 24 Aug 2021 14:40:32 GMT

The Difference: Maintenance vs. Capital Improvements

As a team of experienced property managers and leasing agents, we get this question over and over again: What is the difference between regular maintenance (repairs) and capital improvements at my rental property? Thing is, this is a very important question to ask if you don't know the answer already, because it can have big implications come tax season. Read along to understand the differences between maintenance and capital improvements and learn why it’s important for filing with the IRS!

Maintenance (Repairs)

A simple definition of maintenance or repair work would be any work done to remedy existing damage or prevent ongoing deterioration. The idea with maintenance is you’re simply returning the property to its original working condition. This means that when a water pipe breaks at your rental property, having a plumber come out to fix it will count as maintenance or repair work rather than a capital improvement. If you service your furnace yearly, that would also count as maintenance because you’re doing preventative work, not improving the furnace.

By the way, we've already written about exactly how property managers pick the best maintenance contractors to help you there. Now, let’s continue the discussion to define what a capital improvement is and why the distinction is important.

Capital Improvements

Where capital improvements differ from general maintenance/repair work is that they specifically better the condition of the property or make an “improvement.” Also know as capital expenditures, the IRS defines them as aspects of a property that enhance its value, extend its useful life, or adapt its function.

Maintenance/Repairs = Restorative Expenses Capital Improvements = Enhancement Expenses

Capital improvements must also be permanent or affixed to the building (so that removing them would decrease the value). Note that when an owner makes one of these improvements or capital expenditures, they are also increasing the revenue potential at their property. The IRS considers the following to be capital improvements:

Creating an addition/extension/expansion to a property
Remodeling space to increase the capacity/efficiency of the property
Replacing major structural components (new roof, new siding, HVAC)
Adapting the property for a new use
Rebuilding a property at the end of its natural lifespan
Remedying a current design flaw

Again, capital improvements increase the value of the property and extend its useful life while repairs simply return things to their previous state. We’ll also mention that there are instances when originally diagnosed maintenance becomes a capital improvement because the damage is excessive beyond repair. Now let’s discuss why these differences matter when it's time to file with the IRS!

Tax Implications

The difference between maintenance and capital improvements matters because of how you deduct the costs each year. When it comes to maintenance and repairs, the IRS sees these as “expenses”, and will allow landlords to deduct all (100%) of those costs in the same calendar year. Pretty easy.

On the flip side, because a capital improvement is seen to add value to a property for years to come, the IRS will not allow you to deduct the entire cost of the improvement in one tax year. Capital improvements will depreciate (lose their value) slowly, so the government requires you to track and deduct that cost over a period of time. As property managers, we can’t advise you on all the ins and outs of depreciation and write-offs, but we absolutely recommend that you keep detailed records of maintenance, repairs, and capital expenses so that if an audit does come, you’re prepared!

A Final Word

The line between maintenance and capital improvements can be hazy, which is why keeping track of all your expenses, understanding the differences, and having tax professionals on your side is always the best approach. A property manager can also help with all of this!

6 Key Performance Indicators Every Property Investor Should Understand

Tue, 10 Aug 2021 13:47:46 GMT

KPI's For Profiting at Your Rental Property

Smart landlords and investors are always running their numbers and finding ways to improve their investment strategy. When it comes to rental property, things should be no different. Below, we give you six key performance indicators for tracking success at your investment property. Use these KPI's to evaluate your current investments OR to estimate the profitability on your next (or perhaps your first) purchase!

#1 Net Cash Flow

Net cash flow is the difference between a property’s income and expenses (including debt) each month. As a key performance indicator (KPI), it shows the profitability of a particular unit. Property is cash flow positive only when its income from rent and other items outweighs debts and expenses. The more a property is cash flow positive, the better your returns, and the larger safety net you have for any emergency repairs!

Net Cash Flow = Gross Rental Income - Payments (mortgage, taxes, etc.) - Maintenance Costs

If you’re having a hard time estimating cash flow while evaluating an investment property, you can also use the 1% rule. The general rule states that a good investment property has monthly rents of at least 1% of the value of the property. So, if you’ve got a $150,000 single-family home that rents for $1,500 or better, it’s likely to make a sound rental property that will cash flow positively.

#2 Cap Rate

Calculating a cap rate should be no more difficult than determining cash flow. Your cap rate is your expected rate of return (expressed as a percentage) and is calculated by dividing the net operating income for your property by its market value.

Cap Rate = Net Operating Income (rents + other income) / Market Value (purchase price)

While cap rates fluctuate based on geography and individual real estate markets, seasoned investors typically seek a 5% cap rate, and are excited when they see numbers over 10%! To give a bit of context, the best investor in American History, Warren Buffet, has an average yearly return on his investments of about 11%. This confirms what some of us already know, that buying real estate can be a great long-term investment strategy because it wins over time!

Read more on calculating cash flows and cap rates from our February blog post.

#3 Net Operating Income

A property’s gross operating income is calculated by tallying up all rents and other income to the property (pet fees, parking fees, utility charges, etc.). So, if you’d like to find the net operating income , all you do is subtract your operating expenses (not including mortgages or debt on the property) from that number. Owners with an understanding of net operating income can quickly and easily compare the expected return of one investment property with another regardless of whether it was purchased in cash or financed.

#4 Vacancy Rates

Vacancies are the single biggest cost to owners and investors. That’s because when a unit is vacant, the operating expenses and mortgage payments don’t disappear! While there are many ways to minimize those scary vacancies , landlords will never be able to operate at 100% occupancy. That’s why investors must know the history of the property and its location to estimate their vacancy rate and plan accordingly. Landlords must always calculate for vacancies when they run the numbers!

#5 Return on Investment (ROI)

Return-on-investment, ROI for short, is a fairly universal term when it comes to investing. ROI measures how much profit is made on an individual investment as a percentage of that investment’s cost. When it comes to real estate purchases, determining your ROI is useful and straightforward. Let’s run through a quick example so you know how to estimate and calculate:

The Scenario:
You’re putting 20% down on a $100,000 investment property.
Before you can start earning rental income, you’ve got the down payment ($20,000), closing costs ($2,000), and initial upgrades/repairs ($5,000).
Total Investment = $27,000

You also know your rental market, and after your estimated operating expenses are subtracted from expected rent, your monthly returns will be around $500 ( $500 x 12 months = $6,000/year).
To calculate ROI on this property, take your estimated annual returns of $6,000 and divide by the cost of your initial investment, $27,000.
ROI = just over 22%!

#6 Loan-to-Value Ratio (LVR)

Expressed as a percentage, LVR is the value of a properties loan (mortgage) divided by its market value. An investor that puts $100,000 down on a $500,000 rental property would then have a loan to value ratio of 80%.

$400,000 (loan value) / $500,000 (market value) = .80 x 100 = 80% LVR

The higher the LVR, the greater the risk is for the lender and the less likely they are to approve the purchase. Investors that can make larger down payments are more attractive, it’s as simple as that.

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Why Is My Property Still Vacant?

Fri, 16 Jul 2021 13:15:54 GMT

Let's Discuss Vacancy...And How To Change It

"Why is my property still vacant?" If you’ve asked this question today or have ever asked it in the past, you should absolutely continue reading. That's because long vacancies can be overcome with smart planning! Unless your property is in extreme distress or in the absolute worst part of town, there is simply no reason to deal with significant vacancy. Landlords fall into traps all the time, we’re here to help them out! If you're ready to stop sacrificing returns and put an end to vacancies, keep reading.

Bad Marketing Description

The first thing you could be getting wrong is your marketing or listing description. The listing description is critical to your success in renting and filling vacancies fast! If prospects see your listings and are attracted to them, they shouldn't have to call you or dig deeper for important rental information. Things like price, beds/baths, utility responsibilities, assigned parking are necessary. And if you’ve got a fifth floor unit with no elevator, don’t forget to mention the stairs! We've got a full post to help you write the perfect rental listings too.

Not Advertising Through the Most Effective Channels

If you’re only using Craigslist to market your rental properties, you’re virtually guaranteeing higher vacancy rates and lower quality of lead inquiries. Assuming you’re not going to use a leasing agent to list your property on the MLS, there are still a ton of channels for you to try. Zillow, Trulia, and Rent.com are some of the most popular listing sites...and they don’t cost all that much to get started. Facebook marketplace is a great place to list for free these days as well. The majority of renters are searching online, so don’t neglect to get your advertisement in the most important place!

The Rental Rate is Too High

There is also the possibility that you have the unit/property priced too high. Landlords in this scenario are often left confused because they are attracting a good number of leads, just not ones that are well-qualified. Good tenants understand their budget and won’t waste time looking at something they can’t afford. If you’re not getting any bites, or the inquiries you do get are from unqualified tenants, your rental rate is likely too high.

Difficult Application/Screening Process

Making the application and screening process difficult for your prospects is another reason that your property may still be vacant. Some management companies and landlords charge upwards of $75 application fees as a way to “weed out” the bad groups. The thing is, a good tenant knows their value and won’t expect to pay high fees or jump through hoops to get their applications submitted. Today, there are plenty of web-based programs that make things easier for tenants when it comes to applying for a rental property. Our advice, implement one of them to fill your vacancies more efficiently! Tenantverify.net is one affordable option for you.

Cleanliness & ”Rent Readiness”

When you begin showing your property for rent again, conducting a quality showing is crucial. If your property is dirty or there are visibly unresolved maintenance items, you’re probably wasting your time showing it! It becomes very difficult to fill a vacancy if the unit doesn’t appear rent-ready when prospective tenants are taking their first walk through. First impressions mean the most!

Undesirable Feature

These can be difficult to remedy, but if there are any highly undesirable features of your rental, you may be in for extended vacancy. Examples of these are things like bedrooms that are too small, hazardously steep steps, or noisy tenants in the unit above. If there is a single feature that is unappealing enough, owners will waste time and money marketing and showing the property. In instances like this, a discount offer or an alternative rental incentive may be the only way to fill the vacancy faster.

BONUS: Marketing Before Your Tenants Move Out?

We'll leave you with one last piece of advice before you go, and that is: next time you prepare a lease, include a clause that will allow you to begin showing the property before you current tenants move out! Typically at Robert C. White & Company, we begin marketing property on behalf of our owners 45 days in advance. This lead time allows us to show prospects the unit with things in the property (often a plus because people like to see how others use a space) and most of the time start the new lease with a minimal turnaround. With this strategy, RCW averaged less than 19 days of vacancy at all properties in 2020 and less than 12 days on average from listing to receiving a deposit.

Ready to Screen Tenants the Same as the Pros?

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860-200-3331 or info@robertcwhite.com

Evictions Updates in Connecticut | July 2021

Thu, 01 Jul 2021 14:13:57 GMT

Where Do We Stand With Evictions? Summer 2021 | CT

The world of rentals is ever-changing and at Robert C. White & Company we like to keep our finger on the pulse. We’re coming to you this week with an update on evictions, national and statewide moratoriums, and how landlords in Connecticut can and should be handling things moving forward! This one’s brief, so we’ll dive right in.

CT & Nationwide Eviction Moratoriums

In an important update from the Governor’s office on Wednesday, landlords and investors learned that Gov. Lamont has no plan to extend the statewide eviction moratorium in Connecticut beyond June 30, 2021. It was originally put in place to help individuals and families through economic fallout from the pandemic; the Governor’s rule halted any new eviction filings. With the state moratorium expiring, landlords will once again be able to file new evictions, though the Governor also outlined strict new measures which landlords will have to follow if they wish to start an eviction. The new guidelines can be found HERE in full. The state essentially asks that landlords exhaust all other options prior to eviction.

Also this week, The Supreme Court upheld the national eviction moratorium set by the CDC last Spring. The CDC’s nationwide moratorium is set to expire on July 31, 2021, one month after the statewide expiry. It is very unlikely that the nationwide ban will be extended further unless there is congressional intervention.

Unite CT & Rental Assistance

If you’re a landlord with a struggling tenant or a tenant with difficulty yourself, Unite CT continues to offer relief programs. The state of Connecticut has set a limit of $15,000 of rental assistance per tenant for the program. There are specific qualifications a tenant must meet in order to receive this aid, but with money still being fed into this Unite CT and other national programs, alternatives are there to help you and your tenants avoid evictions.

Moving Forward

As new evictions start to be filed soon, we expect that housing courts will move slowly due to a high volume of cases. With that said, if you are a landlord in a possible eviction situation, you should be creative in your thinking and explore all your options before proceeding to evict. There may be solutions to remedy lost or late rents without all the headache and hassle of an eviction.

Interested in Solutions?
Call or Email us directly about our Landlord Rescue Program .
A property management option for owners dealing with evictions.

info@robertcwhite.com or 860-200-3331

9 Questions to Ask Before Accepting a New Tenant

Wed, 09 Jun 2021 14:33:55 GMT

Before They Sign, Get Answers To These Questions!

Choosing to accept a tenant isn’t a black-and-white decision, especially if you’ve got a few groups to pick from. Of course, you need to verify everyone’s income and run credit checks to confirm they are financially fit to rent your property...but what other questions should you be asking? The right questions (and the answers you receive) give insight into why the group is applying for your property and how likely they are to treat it with respect. These conversations aren’t always easy, but don’t be shy to get the answers you need and make an informed choice! Land the best tenants starting here:

How soon are you ready to start your lease?
This question is always a great place to start. The prospective tenant’s response is important because it will help you determine if they are a good fit for acceptance. If your unit is vacant already, but they don’t want to move in for 45 days, are they the best fit? Maybe not. By that same token, if someone answers this question with, “I need to move in tomorrow,” you should have eyes wide open. Maybe they’re in a unique situation where renting immediately makes sense, but it could also be they are hiding an ongoing eviction. In a perfect world, you’re looking for someone to start their lease on a date that minimizes your vacancy.
What’s your reason for moving?
Getting an answer to this question is also helpful when deciding whether or not to accept a tenant. There are plenty of reasons why someone needs to move, it could be a relocation for work or that the family is expecting another child and needs more space. Whatever it may be, understanding their reason can help you choose the best fit for your property. Let’s say that you prefer long-term tenants (2+ years), but you show your property to a nice group of traveling nurses. They are interested and their income and credit are great, but their work moves them to a new city every 6 months. In this instance, would this group really be your best match?
Have you ever been evicted from a previous residence?
This one is simple and straight to the point, there’s no need to sugar coat it. Knowing whether someone has been evicted before is an important piece of determining whether they will be a good tenant in the future. No eviction history is preferred of course, but an honest answer about the past can also give you insight into your potential tenant. If someone had an eviction 10 years ago but stellar rental history since, they are probably still worth your consideration. Don’t miss out on a perfectly good tenant by neglecting to understand their past.
Have you ever broken a lease before?
Leases aren’t meant to be broken. Tenants sign on for a specific term and are expected to stay throughout. That said, sometimes there are circumstances outside of a person’s control, like a military relocation. That’s why it’s critical to ask if they’ve ever broken a lease agreement before! If they have, find out exactly why they did it and what the consequences were? Was the previous landlord left uninformed or unpaid?

Hearing “yes” in response to this question may be an immediate reason for denial, but understanding more may also allow you to see that they are actually a good fit for your property.
Have you ever filed a suit against a landlord?
Believe it or not, there are tenants out there who just like to sue. In the office, we have a funny nickname for them, “serial-suers.” These “serial-suers” are tenants that will create an incident or take advantage of one to file suit against their landlord (often over minor or unwarranted things). To protect yourself, ask your prospective tenant if they’ve ever filed suit against a previous owner. If they say no, that’s okay, but if they indicate that they have, you may want to ask for details if they will provide it.

In a recent property management nightmare, the same tenant tried to file three slip and fall lawsuits against the same property owner within two years. Maybe there are some spiteful owners out there icing up their walkways to create safety hazards, but in this instance, the landlord had on-site snow removal and de-icing the morning of any storm! They have since learned that this tenant has done the same thing at previous rental properties. Wouldn’t that have been helpful to know in advance?
Have you ever been convicted of a crime?
You’ll want to run a full credit check and eviction search on any candidate, but don’t forget to ask about criminal convictions for yourself too! While there is no perfect timeline for forgiving a crime, you want to know who’s moving in and what kind of behavior they’ve exhibited in the past. Don’t hesitate to find out what you can about a person’s criminal history. At Robert C. White & Company, we make a point to not only process a criminal background check, but also ask the applicant to give their own details. Anyone that gives a different story to their actual background check is automatically going to be denied. Get the info you need to make the best choice.

7. Will others be living with you?
Don’t be caught by surprise after move-in day for your new tenants! Ask them clearly in advance who will be living in the unit (spouses, children, elderly parents) and set clear guidelines for guests. You don’t want unwarranted guests to cause damage or create a disturbance for other neighbors, so set the expectations in advance and pre-screen everyone that would be living in the rental property.

8. What kind of pets do you have?
Do not forget to ask about pets! If a renter has them, what breed/size (if applicable) and what veterinary history does the pet have? Animals can cause damage to your units and also cause disturbance or danger to other tenants/neighbors. Screen them carefully and ask about any issues at previous rental properties too!

If you have a 500 square foot studio available on the 4th floor of a small multi-family, would it really make sense to accept a tenant with two large German Shepherds? Probably not! Get any and all information on pets before you decide to move forward with an applicant. This protects you and your investment.

9. How did you find this rental?
Finally, if you’re marketing units on your own, you’ll want to ask how people came to find your listing. Getting an understanding of which marketing channels work best for you will only make listing the property more efficient. If you knew that all of your quality tenants in the past 5 years came through Zillow, why bother advertising anywhere else?

FINAL THOUGHTS
Picking the best fit for tenancy isn’t easy, but asking these questions gives you more critical information to work with. Nine questions to help protect your investment? Sounds like a no-brainer. Keep reading to learn more through our simple tenant screening guide .

Buying Rental Property with Tenants in Place: Risk vs. Reward

Tue, 01 Jun 2021 16:53:41 GMT

What to Watch For: Never Be Surprised When Buying

Most investors sell their rental properties while they’re empty. It’s easier to schedule and conduct showings for buyers, plus it gives the owner time and space to make repairs or upgrades for a more profitable sale. However, in today’s market, more and more investment properties are offered with tenants already in place. This may sound great to first time investors, but experienced landlords will be cautious. There are benefits, like the potential to be cash flow positive right away, but there are also associated risks. The tenants, their lease, and the property’s condition all need to be analyzed first! Before you close on a purchase, let’s be sure you know what those all are.

The Possible Rewards:

Before we analyze the risks, here’s the nice side of things. Buying a property with tenants in place, in theory, has its perks:

The home likely meets local rules/regulations if tenants are active.
Some amount of rental income is immediately guaranteed, based on the original leases signed between tenant and seller.
No immediate upgrades or repairs should be required.
There is no need to market vacancies after purchasing the investment property.

The Potential Risks:

It’s not all roses though. Landlord’s don’t always have good tenants or know the best practice for writing lease agreements or conducting maintenance. If you purchase a rental property from someone who didn’t know what they were doing, you could be walking into the same trap yourself!

Look at the Lease:

One thing you won’t be able to scrap are the lease agreements that are already in place with tenants. You’ll need to review these leases thoroughly before you make any decision to purchase the property. Make sure that the agreements are in compliance with local and federal laws, maybe even by having an attorney review them with you. Are the terms also fair to the landlord (soon to be you) and the tenants? Save yourself a legal battle in the future by reviewing the leases in advance.

You won’t be able to adjust pricing or terms until the time lapses either. Are you comfortable with the rates that the current owner is getting, and will they allow you to be cash-flow positive after you purchase the property and start incurring expenses?

Screen the Current Tenants, AGAIN:

Do your due diligence when it comes to screening the tenants too. For some landlords, the best way to alleviate their headaches from bad tenants is by offloading the property through a sale. That’s why you need to do your homework here, so you’re not stuck with the same issues! It’s perfectly reasonable, smart even, to request all the tenant screening documents (income/credit/backgrounds reports) collected by the current owner before they signed the leases and make sure this is something you’re ready to take on.

If tenants aren’t paying the rent on time or aren’t abiding by the terms set out in their lease, the potential to profit may not be worth the headache. Don’t just take the seller’s word on things either. Require documents that show a history of rent payments and be sure the security deposit is sufficient if you think there may be damages assessed when the lease term ends. Pets can be a landlord's nightmare too, so ensure the correct pets and policies are in place to protect yourself there.

Are Your Tenants Treating the Property Well?

Maybe the tenants meet all the income and background criteria you’d normally look for, that’s a great place to start! What you also need to figure out is how well they are caring for the property while living there. Conduct a detailed walk through on each unit and note how tenants have kept things. Generally, repairs fall on the property owner, and you’re about to assume that role! Be sure you understand the relationship you’re walking into.

As the new landlord, you’ll have a responsibility to provide a safe and livable environment as soon as you close on the property. If it looks like that isn’t going to be possible because of the current condition of the units, you’ll have to weigh your options carefully. You don’t want to discover major mechanical, structural, or utility problems only after you’ve finalized the purchase.

Wrapping Up:

There are definitely rewards for picking a rental property with solid tenants in place, but there are risks to consider as well. Don’t make a final decision to buy until you’ve reviewed the existing leases, screened the current tenants, and thoroughly assessed damages and repairs needed. Good luck investors!

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4 Practical Ways to Convert More Leads into Tenants

Tue, 11 May 2021 16:04:28 GMT

Convert More Lead to Tenants with These Simple Tips

Most landlords don't manage their properties full-time, and even if you do, it's unlikely that's the field you were trained in! In any case, converting leads into tenants can be difficult, and if you’re not attracting the right quality lead, even more time will be wasted. If you're looking to save yourself hours on the phone, cut down on showings, and increase your conversion rates then keep on reading. Here are four practical steps for landlords who want to convert more leads to tenants!

Tip #1: Improve Your Marketing Descriptions/Listing Write-Ups

This is how many the junk rental listings you'll see online read in full:
Amazing - 2 Bedroom and 1 Bath condo.

Pets accepted. Must have good credit. Contact Tony at 800-Rent-This-Place

And here is a better example of a Robert C. White & Company Listing Description:

The listing description should be a thoughtful first step that includes all relevant details about a rental property, and yet, these write-ups are often overlooked when it comes to converting leads. If you’re not the laziest landlord around, start by making sure your listings include any important details the tenant would want to know in advance of viewing. People don’t expect to search high and low for answers to their questions or simple details. Does it include a washer-dryer or just hookups? Are the water/sewer charges included in the rent? Are there any breed restrictions on dogs? How many parking spaces are available off-street? Make it easy for leads to decide if your property is a good fit based on the facts provided and be sure to highlight major selling points along the way.

Gathering good pictures of your property is more important than ever too. Take a few minutes to capture the entire rental space so folks don’t have to guess what’s around that corner! High-quality images and write-ups save owners lots of time and hassle showing the property to uninterested buyers. Why waste time opening the door for folks who would’ve said, “no thanks” if had they were able to find all the necessary details online!

Tip #2: Track Lead & Leasing Metrics

All landlords should track lead and leasing data year after year, but if we’re honest, there are a few numbers that matter more when it comes to converting. The first and most critical is finding and tracking your best lead sources. Where are leads coming from and are there other channels that could be more reliable? If you know which listing sites, newspapers, or ad campaigns get the best response rate, you can make the best choice when it comes time to list again. Maybe your Craigslist posting brings in one junk lead per/week, but with Zillow, your phone rings off the hook with qualified candidates. If you understand and track your lead channels, you'll waste less time on fruitless marketing and convert more. Knowing the conversion percentage for each lead source is also helpful. Part of converting leads more efficiently is finding the highest quality source for them and pushing those marketing levers first!

Additional statistics worth tracking include:

- Days on Market (usually from list date to lease signing)

- Number of Showings Required to Close

- Price Adjustment (Year over Year)

Tip #3: Accommodate Virtual and Self-Guided Showings

While Covid-19 artificially increased the need for virtual and self-guided rental showings, the trend was headed there anyway. With technology making communication and property access easier than ever, giving prospective tenants the option of a virtual or self-guided can be a game-changer.

It has also become more popular for tenants to show a willingness to sign a lease sight unseen (without physically walking through the property). Oftentimes, this is because they are relocating from far away and cannot physically be there to view the rental property. Giving folks the option to view virtually can then save you time and prevent you from missing out on a qualified candidate.

Tip #4: Accept Online Applications & Rent Payments

One of the last things to change for many landlords and property managers is their willingness to go digital/online with their collection processes. Accepting applications and bringing the screening process online saves tons of paperwork for both parties and makes working with and comparing multiple applications easier. The younger generation doesn’t want to fill things out by hand, and let’s face it, paper copies are harder to keep track of and reference. Making the application process as simple as possible for those that view results in more applications and a better chance at converting those leads to renters.

Tenants are also looking for an easy way to pay rent and fees each month, so opening an online portal to allow transfers is hugely attractive as well! While online rent collection programs/apps do come at a cost to owners, they also save time and effort while increasing tenant satisfaction.

FINAL THOUGHTS

Following up with leads and showing them a property is one of the most tedious tasks a landlord takes on, and it always feels worse when you show a property 10-15 times and still don’t have a lead to apply. If you aren’t already applying the steps above, following them will help you convert more of your tenant leads into ACTUAL tenants. Give it a try and let us know if you have any questions! You can always contact our rental advisor at 860-200-3331 .

6 Critical Lease Clauses to Protect Landlords & Their Rental Property

Wed, 07 Apr 2021 15:44:10 GMT

Protecting Yourself and Your Property

We'll assume that most landlords understand why they need a signed lease agreement, but do they know what determines a good lease from a bad one? Can they see what's missing from their current lease agreements that would be beneficial? At RCW we've designed our lease to be one of the tightest in the industry, meaning our owners are truly protected. We've reworked our agreement many times over the years (with more than 1000 signings/renewals since 2015) and continue to add language specifically to benefit and protect our owners interest. In this week's blog, we identify a few commonly overlooked clauses that every own should consider adding to their lease as soon as possible! Let's dig in.

1. The Visiting Guest Clause

Let's set the stage. You think you’ve found a great set of tenants. Their credit check is clean, income levels satisfactory, and no problems with criminal history. When you decide to sign a lease with them, the agreement lists exactly which adults are responsible financially and who else will live in the property (grandparents, children, disabled family, etc.). Two weeks later, their aunt and uncle move in from Florida, and a month after that, two adult daughters return home from oversees travel. All of a sudden, your quaint rental has 4 new people living there, none of who were vetted.

To help you avoid this kind of situation, insert a clause with a detailed visitor and guest policy. Many landlords in Connecticut consider a guest someone who spends less than 10 days of a month at the property. Having unauthorized people living in your unit could leave you vulnerable to liability, so be clear and concise about visitation and guest policies for renters.

2. Utility Responsibility Clause

Don’t leave the utility responsibility up to chance...tenants aren’t going to pay for things they don’t weren't made aware of. And if owners aren’t clear about who’s responsible for each of the utilities, they’ll be the ones footing the bill. To avoid disputes, landlords should outline exactly which utilities are their responsibility and which belong to the tenant. If there are shared utilities because it’s a multi-unit building, be clear to detail how utilities are paid and billed back to the tenant. Be mindful of state law as well! In CT, if you do not have separately metered utilities (say for public sewer), the owner cannot charge these items back to the tenant and must include them in the rent.

3. Property Inspection Clause

Intelligent owners and investors always keep tabs on their properties, whether it’s with their own eyes, or with the help of a property manager. What if new tenants have moved in extra guests or are being totally destructive? What if they've moved in two large German Shepherds without telling anyone? The only way to find these things out is to walk through and inspect your property. Now, most leases already have a “right of entry clause” that allows owners access for certain activities (like repairs) with a certain amount of notice (say 72 hours). Unfortunately leases don’t often mention anything about regular inspections. Something along the lines of “regular inspections to be conducted every 6 months of a tenants term,” sets a clear expectation with your renter and should avoid any surprise from the request. If tenants know the owner will inspect the property every 3 to 6 months, they’re also more likely to keep it in better condition! Get eyes on your unit to stay informed.

4. Repair and Use Expectations & Liability

This clause is another must have! It may even save our property management clients the most cash in the long run. Every single lease should have a section detailing repair expectations and liability. If you’ve got hardwood floors in your property, and a tenant leaves them scratched and scuffed, you want to be able to hold them responsible. We believe that any damage or neglect caused by a tenant should be remedied at their cost.

Do you want walls to remain intact? Add specific rules about hanging items and be clear that the tenant is responsible for patching and painting the walls to return them to original condition upon move-out.

Worried about damage to carpets? As a part of this repair and use clause, require tenants have carpets professionally cleaned before their move out date, especially if they have pets!

Setting clear expectations with folks can save you a ton of money in the long run and creates more conscious tenants. They won’t always abide by the rules, but at least they will be held accountable.

5. Subleasing Clause

Subleasing is when a current tenant finds someone else to take over their lease. Depending on the situation, allowing tenants to sublease can be quite dangerous. What issues could there be? Well, your new tenant may be chronically late on rent, cause disturbances to other tenants around them, or be destructive and uncaring with your property. At Robert C. White & Company, we don’t advise any of our owners allow subleasing, and our lease agreements state that clearly. Be smart and include a subletting clause. Don’t wake up one day to find out you’ve got a random new tenant and they just so happen to own 8 cats!

If you are going to allow subleasing, set clear expectations in your lease agreement. New tenants should be approved through a similar screening process to the original group and only with an owners written confirmation.

6. Pet Protection Clause

Allowing pets in your property is somewhat necessary at this point. The American Humane Society estimates that over 70% of renters have a pet of some kind, and it would be foolish to say "no," to more than half of the tenant pool. With that said, leases absolutely must include a pet protection/animal agreement clause. You don't want to find yourself in a scenario where the tenants dog has scratched away your door frame, but you've got no recourse to charge them for the damages. Here are some of the items we include in our pet agreements to protect our owners:

Details on any pet fees and any additional security deposit for a tenant's pet. What the pet deposit be used for.
Which pets specifically are being allowed as a part of this rental agreement. Can pets be switched out or added.
What outdoor/common areas can pets use.Guidelines for picking up feces and keeping areas clean.

All of these set smart and strict guidelines for pets at a property and will help avoid issues in the future. Tenants can't really dispute things that are written in their lease!

Final Thoughts

Making sure that these 6 clauses are a part of your next lease will help keep you and your property protected! Again, tenants don’t always follow the rules of their lease agreement, but clear expectations do make it easier for them. The relationships between landlords and tenants is an ongoing one, so set yourself up for success early and protect both parties with these crucial clauses!

Landlord 101: Spring Cleaning Checklist

Mon, 08 Mar 2021 16:40:53 GMT

Exterior Focus: What's Important for Spring Cleaning?

Believe it or not, Spring is right around the corner! March 20th marks the official start of the season, which means you’ve got about 10 days to start planning for outdoor maintenance at your rental property. It’s just a rental though, is curb appeal really that important? Of course it is! The exterior of your property is the first thing potential renters notice, and I’m sure you’ve heard the phrase, “you never get a second chance to make a first impression.” When tenants like what they see on arrival, it primes them for purchase, even when they find something they don’t like as much inside! A well groomed exterior also makes marketing pictures stand out and can allow you to generate extra revenue from rents.

Don’t skip any of the items on this Spring cleaning checklist. You’ll make current tenants happier, fill vacancies faster, and be able to demand higher rates with some seasonal improvements. We’ve identified 7 key areas of focus for you, let’s see what those are!

Inspect Gutters, Siding, and Seals

Winter storms come year after year bringing high winds, freezing temperature, plus snow and ice! In New England, a lot of the exterior wear and tear on a property comes from the harsher winter months. Spring then, is the perfect time to check that siding, seals, gutters, and even shingles are affixed properly. Patch and repair any damage now so it doesn't snowball into larger issues next winter! Your current tenants and prospects don’t want to see parts and pieces hanging off the side of the home, so make the necessary repairs and keep these items in working order.

Take Care of Loose Limbs and Hazards

Loose limbs and dead trees are a major eyesore for tenants as well as a potential hazard. Clearing them isn’t always the easiest task though, as large branches and trees can be dangerous to remove without professional oversight. If necessary, higher a tree trimming company to come out and take care of scraggly branches and dead trees. Also consider trimming hedges and shrubs so they won’t be overgrowing on entryways, blocking light through windows, or hanging precariously over the driveway!

Get Grass Trimmed and Seeded

Keep your grass cut, and as green as it can be! At most residential rentals, the tenant is responsible for lawn care, but with multi-unit buildings, that’s less likely. If the yard is yellowed/brown, have it reseeded or at least fertilized to get some growth back. On the other end of the spectrum, where the grass may be tall enough for a lion to hide unseen, get it trimmed and consider hiring a contractor to keep it that way on a weekly basis! Having common areas that are useful and attractive can boost your bottom line.

Examine Porches, Decks, and Overhangs

As things thaw out, there’s another opportunity for you to check crawl spaces, porches, decks, and overhangs. When snow and ice sit up against the side of your home or on top of wooden structures, they are slowly doing damage. Wood expands and contracts but also rots over time, so check boards and beams to make sure things are structurally sound. It’s also smart to close any gaps/openings beneath porches and decks so that rodents and other animals don’t find their way inside and create a home for themselves!

Wash & Seal Walkways + Driveways

The springtime brings sunshine and is a good time to check paved and concrete surfaces like walking paths and driveways. Tenants don’t want to walk over uneven and potentially dangerous surfaces...and landlords don’t want to be held responsible if they fall. To avoid the headache, take care of serious cracks and potholes by resealing. Where there is dirt, grime or weeds growing through, just a power washing job may do the trick. Either way, you’ll want things to look nice for the best first impression.

Clean Flower Beds & Yard Debris

While weeding and general yard pick-up are probably the least exciting item on this list, they are necessary to keep current tenants happy and entice potential tenants to close. When common areas are well maintained, it shows that the property manager or landlord cares for their clients. Again, curb appeal is the first impression, so make it count!

Walk Fencing and Property Boundaries

If you’ve got a fence or natural boundary at your rental property, you’re probably using it as a selling point, as you should! Most tenants have pets or young children, and in both cases, having an enclosed yard is a boost. At the start of Spring, walk the boundary at your properties and assess damage to rock walls or fencing. Fix and repair broken and fallen pieces so you can get the most revenue possible.

A Final Word

Owners that don’t use a smart check-list like this tend to overlook things they meant to take care of when the weather got nicer. In the long run, this usually means more time and money on maintenance, less satisfied tenants, and more difficulty re-renting. Don’t be one of those owners! Get focused and complete the items on your Spring cleaning check-list then. Peace of mind feels great.

Cash Flow and Cap Rates: What Makes A Good Investment Property?

Thu, 11 Feb 2021 16:03:34 GMT

How To Determine Good From Bad Rental Props

There are lots of factors to determining a good rental property from a bad one, and the items we discuss here, cash flow and cap rate, often go hand in hand. If you’re cash flow positive at an income property, that's great! And if your cap rate is high relative to similar listings, you’re going to earn some serious money! But what if you’ve never heard of these terms and it’s your first time deciding whether to rent or sell? Or you want to get some basic knowledge before you make an offer on an investment property? Well, you’re in luck! This quick start blog will help you understand both cash flow and cap rates, plus give specific examples to show you the calculations, let’s flow!
What is Cash Flow? Will it Cash Flow?

Cash flow is simply the amount (+/-) of cash on hand annually after all expenses have been. Maybe you think you’re ready to handle tenants requests and maintenance items, but do you know whether your property will be cash flow positive once it’s filled? Let’s get into more detail...

First you’ll start by finding the expected market rent for your property. You could use Zillow, Trulia or some other estimator, but this is best done for FREE with the help of a local real estate professional! If you'd like, you can even request one from our advisor through the link HERE now. Once you know the rental income your property can expect to bring in, it's time to run the numbers. Below is the formula to calculate a property's yearly cash flow and an example for you to chew on. Cash flow at the sample property is + $4,775/year, and positive cash flow is great!

Cash Flow = Gross Rental Income - Payments (mortgage/taxes/fees) - Avg. Yearly Maintenance Expenses

$4,775 = $28,200 (12 months x $2,350/month rent) - $21,600 (12 months x $1,800/month) - $1,825

What About Cap Rates?

You now know how to calculate cash flow and your property may even project positively! However, some rental properties (like any investment) are better than others. If you sold your property today and put the money into the stock market, could you make more year after year? Well, maybe… but this is where cap rate comes in handy!

Most property investors use cap rates as an indicator of how strong their investment is. A low cap rate gives good reason to sell, but a high cap rate indicates a well performing rental property. Once you learn what cap rates are and how to calculate them, you’ll be able to compare your property’s projected returns against other potential investments. If you end up with a low cap rate after you project the numbers, renting may not be the wisest choice for the property in question! Let’s define cap rate now and go through an example together here.

What is Cap Rate?

Cap rate is a calculation used to determine an investment property's profitability, and what is considered a good cap rate can vary greatly based on location. If your purchase price for a property is low compared to expected rents, you’ll have a high cap rate. In residential areas, cap rates can get as high as 8-12%. Caps rates also change over time, which is why investors must keep any eye on their properties, and may decide to sell one in favor of purchasing another. If rental rates in a particular area do not increase, but costs of maintenance, taxes, and other items do, then cap rate declines.

How to Calculate Cap Rate:

Cap rate = net operating income (gross rental income minus operating expenses) divided by your purchase price.

Gross rental income = all rental income from tenants

Operating expenses = mortgage, insurance, taxes, repairs, marketing, vacancies, etc.

Purchase price: 300,000

Gross annual rental income: $25,000

Minus annual expenses: $6,000

Gives you a net operating income of $19,000

$19,000 net operating income divided by your purchase price gives you a cap rate of 6.33%. Not too shabby!

Final Thoughts

You’re now armed with two crucial equations, cap rate and cash flow. Both will help you determine the potential returns for your rental property and allow you to better assess the investment’s performance and potential! There is another side to this coin though...because even if you project positive returns, you’ve got to think about marketing, tenant selection, completing repairs and other general management items. For more helpful articles and links for landlords, visit our blog and check out what else is on offer!

How Property Managers Choose The Best Contractors

Tue, 19 Jan 2021 17:26:38 GMT

Our Selection Process: Work With the Best

The winter months can be a real headache for landlords managing on their own. Heating systems break, roofs leak, and driveways crack. It also gets cold in Connecticut, which can make repairs more costly and time consuming. In these instances, you’re stuck searching for a heating specialist or an electrician that is not only trustworthy, but can bring you a solution as fast as possible. Robert C. White & Company has a team of property managers with tons of first hand experience dealing with contractors and vendors, so we’ve decided to share our selection process to help landlords out there.

This quick-guide will be especially helpful to owners with multiple income properties or those that have moved away and can’t complete maintenance themselves anymore due to distance and travel. Here’s how the professionals approach things!

What Makes a Good Contractor or Vendor?

The best property managers seek out vendors using very specific requirements. Because we manage on behalf of owners, we’ve got to be even more selective then if we were looking for contractors at our own properties.

Must Be: A Licensed Contractor

The first, and most important thing to look for, is whether or not a contractor is licensed by the state and local agencies to work in their field. A licensed vendor has gone through the minimal requirements and tests necessary to comply with local authorities, and has received the necessary training and experience in their line of work.

Must Have: Liability Insurance

In the event that an accident occurs at a property, it is crucial that the contractor you’ve hired is also insured. Liability insurance will promise that the company or individual can be held responsible for the accident. Property managers that do not hire licensed and insured vendors where they manage, run the risk of being held liable themselves. This is why we always check credentials before starting a working relationship. If the "professionals landlords" require it, shouldn’t you? Keep your rental property protected by only working with licensed and insured contractors.

Must Have: A Good Reputation

These days, reviews are everything. We usually go online for a product review or comparison with small purchases...so why not do the same when hiring a contractor? Property management companies look for positive reviews and client success stories before deciding to work with a vendor at their managed properties. In Robert C White’s case, we prefer to work with a contractor multiple times before making them a part of our regular rotation, consider the same.

Must Have: Competitive Pricing

Because property managers work on behalf of owners, we are constantly looking to strike a balance between the cost and the quality of the work being done. It’s our duty to keep costs low with regard to repairs and maintenance so that our owner’s investment brings the highest possible returns.

With high quality contractors, pricing can be higher too, so it’s worth comparing multiple options when possible. If you do have multiple groups that meet the other criteria (licensed, insured, and well reviewed), then you can start to compare costs. Even so, the vendor must have availability to complete the job quickly for you as well.

Must Offer: Clear Communication

Lastly, property management companies and savvy owners will look for consistent and clear communication from their vendors. If you sent someone out to complete a one-day job and they didn't communicate their tardiness, would you hire them again? Unlikely. Same with costs or other project expectations... use contractors that clearly and openly communicate issues or changes to the project before charging ahead! This is key to building a trusting working relationship.

NEED HELP?

Robert C. White & Company is a full-service property management company specializing in residential rentals in Central and Southern Connecticut. Reach out today for more information about full-service property management.

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5 Challenges to Managing Multiple Rental Properties on Your Own

Thu, 31 Dec 2020 15:24:46 GMT

Property Investors Will Face Challenges: Here's 5 Big Ones

Being a landlord can be extremely rewarding, especially if you’re turning a profit. For most investors, owning and managing one rental property is easy. Managing two or three is even doable for someone with a bit of appetite. The thing is, once you go beyond that, self-managing your rental properties can start to feel like, or become, a full-time job. Managing multiple income properties certainly comes with its challenges, but they may all be worth it! Let's discuss 5 challenges that all do-it-yourself landlords run into at some point or another:

1. Marketing and Showings

If you have vacancies, which all landlords will from time-to-time, one of the first challenges you’ll have to face is filling those vacancies, which requires you to show the property. Not only will you have to set up some online marketing with pics and a description for each unit you need to fill, but you’ll have to get them on the phone and schedule a date and time for them to walk through with you. Showing property to prospective tenants can be very time consuming, especially if the local market demand for rentals is low or you're entering a difficult time of year (like winter) when fewer people are moving anyway.

2. Tenant Screening and Selection

Even if you can handle showings and scheduling on your own for potential renters, you’ll also have to take on the challenging task of screening and them and making the right selection. At Robert C. White & Company, we have access to detailed credit reports, landlord histories, and more...but without professional tools at your disposal, how can you be sure you’re equipped to handle the task effectively. Picking the perfect tenant isn’t easy, and it doesn’t always happen quickly...but if you do get this part right, you’ll make your life easier while managing a property with quality renters.

3. Maintenance and Repairs

Whether you’ve got good, bad, or indifferent tenants in your properties, perhaps the most time consuming challenge that self-managing landlords deal with is coordinating maintenance and repairs. Even for a super handy owner, scheduling and completing even minor repairs at multiple properties can be incredibly time-consuming. The fact of the matter is, owning multiple properties and having many different types of maintenance problems, you’ll need to develop a list of trustworthy contracts that can help get things done quickly. Even if you do hire out maintenance and repairs, it still takes time to schedule and coordinate events. And you’ll need to keep your list of contractors large enough to handle requests at multiple properties at the same time.

4. Tenant Disputes

A large part of managing multiple rental properties is having to deal with constant tenant disputes and complaints. When maintenance items linger or a neighboring pet keeps your tenant up all night, you’ll need to act promptly to resolve their issue. When a renter is paying on time and caring for the property as outlined in their lease, they’ll expect fast and quality service to resolve things. This is why self-managing owners are often labeled “slum lords,” because they don’t have the time and resources to develop a good relationship with their tenants and stay on top of disputes and ongoing issues.

5. Time Management

What’s the biggest challenge for many self-managing owners? Of course… time management! Owners with multiple properties may feel like they are getting pulled in 10 directions at once, so you’ve got to get smart about managing your working hours. The goal for most investors is “passive income,” but that’s hard to accomplish if you’re constantly needing to market vacant units, collect rents, and manage repairs across the board. This is why many investors find a property manager worth while once they have gotten their hands on more than one property. With average management fees around 10%, landlords can take a back seat and let their investment grow while a professional handles the stresses of management!

A Final Word

Whether or not you’re a multi-property investor already, or are just getting started in your landlord journey, anticipate and expect these challenges along the way. Only if you’re smart and efficient in your processes, will you be able to self manage effectively (and without losing your sanity)!

Here's to wishing all landlords and tenants health, prosperity, and happiness in the new year!

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How Coronavirus Has Changed Being a Landlord

Tue, 08 Dec 2020 21:09:28 GMT

Renting after COVID-19: What’s Changed

I know an investor that has a 3 family home in a 100-year floodplain. Regularly, he would complain about the cost of the flood insurance he was required to pay. His regular message was “I’m just throwing money down the drain”. You see, it never flooded. And because after years and years of ownership he had never seen a flood he soon began to believe it would never flood. . . until it did.

One day I got a frantic call from him that his entire basement was underwater, the fire department had to kill the power to his investment property, and all of his heat and hot water systems were underwater. I helped him address the problems, got power and heat back to the tenants, and got things back to normal.

In the end, the flood insurance saved him. He was able to get all of the costs covered and he now thinks flood insurance “is the best thing ever”. What changed? Perspective.

COVID-19 has changed people’s perspective too. Before it started I don’t think I ever heard of the 1912 Flu and I am sure I never thought through what would happen if a pandemic hit. Well, now that it has, and as we see what has happened to date and how things are continuing to evolve, if we don’t reflect and take stock we miss the lessons that will help us move to a stronger position overall.

As we have taken stock at Robert C. White & Company I think there are 5 major things to highlight what has changed with renting after COVID-19. Here they are:

1) The government is willing to change the rules.

2) Tenant quality matters more than ever before.

3) Reserves are more important than ever.

4) You need a deeper vendor bench than you think.

5) Health and safety concerns (rightly) will impose changes in your processes.

Before I jump into giving more detail on the 5 major things that have changed with renting after COVID-19, I need to make a note. I run a property management company in North Haven, CT. We manage single-family homes, condos, townhouses, and select small multi-family homes throughout Central Connecticut. I share that so you know what strongly influences my perspectives. While I think these five highlighted changes have universal application, some of what I touch on is specific for Connecticut (and likely can be extended to much of the Northeast). Even though some specifics are for Connecticut it does not take away from the learning.

Let's Dive In:

Government is Willing to Change the Rules:

We have seen government take action and change rules in a big way. When it comes to residential rental properties I have been surprised the extent to which Government has been willing to intervene. Specifically in Connecticut, as of the day that I am writing this, no property manager or landlord can even start an eviction for nonpayment of rent or tenants staying in a rental home longer than the lease provides for. Unless extended (a second time), that ban on evictions (with a few exceptions) will lift on August 22nd, 2020.

Not only that, but here in Connecticut, State Government, through executive orders, have in essence change the rules on when rent is actually due, extending grace periods, which are outlined by law, from 9 to 60 days back in April and May.

Courts have gotten involved also. In Connecticut, the Chief Administrative Judge for Civil Matters has put a stay on all Executions through August 1st, 2020. That is a fancy way to say if you have a court signed document that allows a State Marshal to legally remove a tenant from a property you can’t use it. This has happened 5 times already, starting back on March 17th, 2020. Some landlords have been waiting since March to get tenants out of their rental properties for things that happened before the State even shut down and layoffs happened.

To be honest, I was very surprised when I saw the State Government interceding in private lease agreements. There is actually an active lawsuit against Governor Lamont from private Connecticut landlords saying he overstepped his authority and violated their constitutional rights. Whether he did or did not will play out in the courts, and frankly is not the main point. Whether you think the restrictions were good or bad things is irrelevant too.

What is important to take away here is the Government will change the rules in a way that affects landlords materially and if you know that you can do something about it . . . hence the next two takeaways.

Tenant Quality Matters More Than Ever Before

New Paragraph When I started investing I frankly was a bit cocky. The first property I bought was two two-family homes on 1 building lot. It was in a rougher neighborhood, but I knew the market well and I was convinced that we would be able to “change the neighborhood” by fixing up the house and units. Well, let me tell you, that did not go as planned.

In the first several years we had to start 4 evictions and re-fix up the units several times. You see, even though our units were nice, the neighborhood was not, and when quality prospective tenants came to see the property, they would love the home, but hate the neighborhood and go elsewhere. In the end, we had to settle for lower quality tenants who predictably had problems with rent payment eventually.

It wasn’t until we bought a blighted building in the neighborhood, gut renovated that, and made some other changes were we able to increase the quality of the tenants in our units. Now the property runs quite smoothly, but I learned a hard lesson. . . tenant quality matters a ton in the real estate investing game.

And when COVID-19 hit, that showed more than ever.

Fortunately, the portfolio of homes we manage has a very strong tenant base. We have had very few rent collection problems throughout this period. However, other property management peers that I talk with are not so lucky. They have tenants that haven’t paid for months, and with the courts closed for evictions, they have few options to get them out or encourage rent payment.

And I don’t think we are out of the woods yet. Unemployment and underemployment rates remain high and Federal unemployment support will start phasing out at the end of this month. I expect that more payment problems will reveal themselves.

There are some very practical things you can do if you have a payment problem right now, even if the courts remain closed, but our focus with this article is taking stock and adjusting for the future. And when looking at the future, I see one thing that matters more than probably all others . . . tenant quality.

Having quality tenants that have both the willingness and ability to pay and who will treat the property well is gold and it is worth waiting for them and lowering the rent to entice them to pick your property over their many other choices.

Reserves Are More Important Than Ever

Banks tell you to have three months of payment reserves for each investment property. I always thought that was overkill, and aimed to have about one and a half to two months (outside of reserves for capital expenditures for roofs, etc). Now, I have a medium-sized portfolio, so the impact of a vacancy or nonpayment of rent is spread over many more units, which makes it easier to address the financial impact of those things.

But, when everything hits at once, like with this Pandemic, three months of reserves looks like sound advice.

People that have solid levels of reserves are sleeping well at night, and those without are not. Outlier events happen. It’s not if, it’s when. Do yourself a favor and make sure you have the liquidity to weather future storms in a less stressful way.

Ideally, you have ample reserves and liquid cash so when distressed real estate investment opportunities arise (there will be fallout that creates opportunities) you are in a great opportunity to jump on them.

You Need A Deeper Vendor Bench Than You Think

As a property management company serving a pretty wide geographic area (at this time we serve all of New Haven, Hartford, and Middlesex County as well as parts of Fairfield, Tolland, and Litchfield County), we know we need not just multiple vendor partners for each trade (i.e., plumbing, HVAC, electrical, etc), but also multiple vendor partners in each area for each trade.

No doubt, we have a deep bench of vendor partners, and we constantly look to add to it and improve it.

Even with the number of vendors we had, it wasn’t enough when COVID-19 hit. Home services companies were often running skeleton crews, only dealing with emergencies, or frankly, just waiting for the time being. The health scare and stay-home orders reduced the capacity of vendors dramatically and our normal vendors often weren’t available.

That required us to hit the phones and find more vendors, and we have luckily found some really good ones that we will regularly use now.

However, the point remains, you need more vendors on your bench than you had before COVID-19. If you are small and have one plumber you use, get 2 or 3. If you are bigger and have 2-3 already, get your bench to 5 at least. It matters more if you are using companies that are 1 or 2 person operations, but even if you utilize a big company, you have to have backups.

And a trick here is you can’t just “have them on the list”. You have to use them. The reason you have to use them is that you need to know if they are good and because they need to recognize you as a “customer” before you have an emergency.

Health and Safety Concerns (rightly) Will Impose Changes in Your Processes

Look, the pandemic has people scared for obvious reasons. Whenever valid health and safety concerns arise you need to pivot, including potentially changing your processes, to adjust.

For us, the biggest changes have occurred with routine maintenance, inspections, and showings.

With routine maintenance, as long as the holding off on fixing the problem would not damage the property or lead to a safety concern, we have given the tenants the decision making power to say whether we fix now or fix later. With inspections, we have shifted several by up to 3 months to accommodate the concerns of some of our elderly tenants. And with showings we have reduced the frequency, have conducted virtual showings, and utilized our marketing videos to the fullest extent.

And in all cases, we have increased the cleaning procedures and enforced the use of PPE for the safety of all.

These are small changes to make to ensure everyone remains safe and healthy and has some nice unforeseen positives, including seeing how effective the virtual showings have been.

There you have it, the 5 major things that have changed with renting after COVID-19. While everyone hopes it will be 100 years or longer before we have another event like the one we are in now, we do know that “Black Swan” events happen more often (about every 10 years). I hope you are one of the wise ones that takes learning from today to make your real estate investing stronger in the future.

How to Strengthen New Connections Virtually & In-Person

Tue, 17 Nov 2020 16:26:55 GMT

Let's Get Stronger...We'll Do It Together

In the age of Covid, property management companies like ourselves are having to discover and invent new ways to connect and interact with leads and incoming tenants. A good property manager will always make timely communication with their client’s (the property owners), but a great property management company will also focus on building better relationships with the leads and tenants they interact with. Here are a few ways Robert C. White & Company is strengthening our connections both virtually and in-person with our rental prospects.

Make Things Easy: Offer Virtual Tours

The timeline for renters to make decisions these days seems faster than ever before! Here at Robert C. White & Company, our managed rentals have had an average list to deposit time of fewer than 17 days in 2020. With the pandemic limiting movement for most Americans, there is a low supply of rental housing but still a high demand. This means that searching for a rental has become extremely competitive for your prospects, and forces decisions to be made quickly. So how can we decrease the stress on our possible tenants? Offer them virtual tours!

Why make virtual touring a priority? To save yourself and your prospective tenant time, energy, money, and even travel! If you are renting out a studio apartment or a small condo, your best prospects are likely younger professionals... and these millennials will expect to be able to see things online! A virtual showing is certainly convenient and is no doubt a safer option during a global pandemic. And think about this, if you have leads who are inquiring from out of state or just a few hours away, they won’t want to travel to view a unit that may not fit their needs anyway.

Ways of hosting a virtual tour at your rental property:

Option 1 : Face-To-Face Virtual Tours: This type of virtual showing is conducted by an agent or the self-managing landlord. With this option, the prospect can walk through with the agent in live time and ask questions/point out concerns.

Option 2: Prerecorded, Self Guided Tours: Though less personal, a prerecorded walk-through can still be highly useful to your prospects. The agent or landlord should walk the property room by room, and give a brief but detailed description of the space.

Pro-Tip: Even if you’re offering face-to-face virtual, RCW recommends shooting a “self-guided” virtual tour anytime you prepare to remarket! Prerecorded video tours give prospects a ton of information upfront and help cut down on scheduling real showings for unqualified, less than serious leads.

Be Speedy in Response: Fast!

These days, consumers can gather information on a product and make the decision of whether or not to buy quicker than ever. With most answers being just a Google Search away, the consumer expects to get what they want easily...and fast! Making sure you’re replying to leads and prospects quickly will always give you the upper hand. Especially during this pandemic, where the supply of rental properties remains low, connecting with the best prospect promptly means they won’t have a chance to sign elsewhere.

Here are some ways to follow up effectively with any new prospects:

Use an automated lead management system like Tenant Turner or Appfolio to reply to leads immediately and schedule showings without the need for conversation.

Create customized, personalized responses for each individual or group.

Ask questions that can give you a competitive advantage. Example: For someone who you believe requires in-unit laundry access, you might ask if they own units already to focus the conversation around an important factor!

Try to determine their timeline... perhaps you can convince them to sign-on earlier and avoid vacancy, or start a week later to give you a window for upgrades and repairs.

Improving In-Person Connections with Prospects

So we’ve talked about virtual showings, but how do we improve our conversation with groups that still want the chance to view in-person? Not all that differently! Here are some helpful hints to lead a successful in-person showing with your new prospects:

Don’t Sell, Have a Conversation: Nobody wants to feel like they are being sold to, and a good product that fits the needs of the buyer, will usually sell itself! Keep things conversational and don’t focus on “the sale” with your prospects. Get to know them and find out what’s important to them.
Highlight Key Factors: Identifying what’s important to each prospect is critical to improving your connections as well. The chances of closing a lead increase dramatically when they feel that you’re giving them exactly what they want. Say you know that your prospect is into classic cars, wouldn’t it make sense to highlight the private driveway and 2 bay garage that comes with your rental?
Personalize Your Follow-Up: The last piece of advice here is regarding follow-up because there are plenty of agents and landlords out there that don’t care to get personal. If you’re going to touch base after showing a property, whether in-person or virtually, make sure that your follow-up includes a personal touch. Use first names when addressing people and thank them for coming out! You may even consider a handwritten thank you or small gift card if you’re looking to create a lasting connection.

A Final Word

During this pandemic, we have all faced uncertainties and had to reduce our face-to-face interactions, but at Robert C. White & Company, we have also found new ways to connect with our leads and prospects and maintain some of the personal touches we’re all missing out on. Whether you’re offering virtual or in-person showings, there are ways to improve your process and strengthen the connections you’re establishing. In the end, a stronger personal connection reduces the time and effort needed for marketing and leasing and leads to happier, more reliable tenancy.

The Must-See Fall Home Maintenance Checklist

Tue, 27 Oct 2020 16:33:43 GMT

The Dangers of Winter

Do you own your home or rental property? If you’re interested in avoiding repairs that could cost you lots of time and money down the line...then keep reading!

At Robert C. White & Company, we’ve managed hundreds of homes throughout the winter. We know from that experience, that a fall maintenance check is critical, and saves our owners money when the seasons change! Those that choose to hold off on preventative maintenance will spend more on repairs and have more problems when the frost does eventually hit. That’s because winter brings the cold, ice, rain, snow, sleet, and wind. All of these elements can severely damage a property if you’re not careful, which is why we put this checklist together. A well-prepared homeowner that inspects during the fall can save themselves the hassle and increased cost of dealing with repairs during winter.

Use this checklist over the next few weeks to prepare your property for FREEZIN’ SEASON! ��

Outdoor Checklist

Inspect the Roof - Check your entire roof for leaks, holes, broken shingles. Repair and patch the areas of concern and seal correctly. We don’t want frozen water to get inside!
Inspect and Clean Gutters - Grab your ladder and clear out your gutter system and downspouts. Remove leaves and debris so water can travel freely.
Windows and Doors - Inspect the outer seals for all doors and windows on the home. Caulk/replace weather stripping where necessary. Install storm windows or external doors and remove unnecessary screens.
Driveway/Walkway/Patio - Inspect for cracks and breaks in concrete/pavement and patch as necessary.
Siding - Check siding around the exterior of the home, replace or repair any missing pieces to keep out water and ice.
Outdoor Faucets - Turn off the outdoor water source. Drain water from hoses and sprinkler systems to prevent freezing and cracks. If necessary, insulate outdoor faucets.
Trim Trees and Large Plants - Frozen temperatures mixed with ice and snow build-up can cause loose branches to fall easily. Trim and discard any low hanging limbs.
Secure Snow/Ice Removal Tools or Outside Servicing - Make sure you have the right tools and equipment to handle ice and snow at your property during the winter months. Or, secure an outside service to get it done for you!

Indoor Checklist

Test and Service Furnace - If you haven’t turned the heat on yet, you may be crazy...but test your furnace and complete regular maintenance to the system.
Windows and Doors - Inspect the inner seals for all doors and windows on the home. Caulk/replace weather stripping where necessary.
Fireplace and Chimney Cleaning - Have chimney flue cleaned and cleared if necessary. Test your fireplace is working correctly and smoke venting properly.
Wrap Exposed Pipes to Prevent Freezing - If you have pipes running through your basement or garage that is unheated, it may be smart to wrap the exposed pipes to prevent them from freezing!
Add Insulation to Garage/Basement/Attic - Consider adding insulation to the garage, basement, or attic space to retain heat in the property and save you or your tenant’s monthly heating cost.
Replace Smoke and Carbon Monoxide Detector Batteries - Check to make sure they are working correctly, replace batteries where necessary.

Doing-It-Yourself
Doing your best to take care of these home maintenance items before winter will save money in the long run and will allow you to get as much life out of each aspect of the home. This is especially true if you can do-it-yourself, as there are many helpful tutorials and videos on the internet to get you by with minor maintenance projects! If you ever feel like

Robert C. White & Co. Peace of Mind: Inspections, Reporting, & Analysis

Following a checklist like this helps keep your property running efficiently and prevents issues from snowballing! At Robert C. White and Company we conduct inspections at least twice a year so we can keep a watchful eye on the properties we manage. We also provide detailed reporting and analysis so our owners can see how their investment is performing month after month, year after year.

If you’re in the market for property management services give our Rental Property Advisor a call today at (860) 200-3331 to request a FREE RENTAL ANALYSIS or CUSTOM QUOTE!

Hoarding and Tenants: What You Need to Know as a Landlord

Wed, 14 Oct 2020 15:12:21 GMT

Hoarding &Tenants: What You Need to Know as a Landlord

Reality TV has given much attention to the issue of hoarding nowadays. There is much debate over whether such shows accurately portray this condition. Nevertheless, awareness of the condition and subsequently reported incidents seem to be on the rise. As of May 1, 2013 Hoarding has been officially recognized as a mental disorder by the American Psychiatric Association. Did you know that? If you answered no and you're a landlord...keep reading! Even if you're not a landlord...keep reading! I promise you won't be disappointed.

WHAT IS HOARDING DISORDER?

Hoarding disorder is a distinct mental disability defined in the Diagnostic and Statistical Manual of Mental Disorders (DSM-V) as follows:

The disorder is characterized by the persistent difficulty discarding or parting with possessions, regardless of the value others may attribute to these possessions.
The behavior usually has harmful effects—emotional, physical, social, financial, and even legal—for the person suffering from the disorder and family members.
For individuals who hoard, the quantity of their collected items sets them apart from people with normal collecting behaviors. They accumulate a large number of possessions that often fill up or clutter active living areas of the home or workplace to the extent that their intended use is no longer possible.

FAIR HOUSING AND HOARDING

If you didn't already know, The Federal Fair Housing Act was adopted in 1968 and amended in 1988. In short, with regard to renting property, Fair Housing prohibits discrimination based on race, skin color, national origin, religion, sex, familial status, or disability. There are also extra protection measures for those with disabilities. If one suffers from a physical or mental disability, for example: hearing loss, mobility or visual impairment, chronic mental illness, AIDs, intellectual disability, or chronic alcoholism, landlords MUST allow for "reasonable modifications and/or accommodations" if requested. What is a reasonable modification or accommodation you ask? A perfect example would be allowing a service or guide dog in a building that normally does not allow pets for someone who is blind. By the way, a service animal is not considered a pet. Read more about service animals according the the Americans with Disabilities Act HERE .

WHAT IS THE IMPACT OF HOARDING ON TENANT SCREENING?

Ok, so obviously there is no database you can use to check and see if a prospective tenant is a hoarder or has an official mental disability; but, what if you are checking references and a previous landlord tells you that Trisha the Tenant is a hoarder?

You can not and should not act on that verbal report alone! You must have true evidence that "Trisha the Tenant" has "posed a direct threat to the health or safety of others or whose tenancy would result in substantial physical damage to property of others." According to federal discrimination laws, those posing such threats to the health and safety of others are not covered or legally protected.

The Clutter & Housing Pros, a company out of Southern California have been working with individuals struggling with hoarding issues since 1999 and they help them take control and restore their homes. Below is an image of the Clutter-Hoarding Scale according to the National Study Group on Chronic Disorganization (NSGCD). It illustrates the various levels of clutter, its impact on health and safety and types of necessary interventions.

HOW DO I KNOW WHAT A "REASONABLE ACCOMMODATION" IS FOR HOARDING DISORDER?

HOME (Housing Opportunities Made Equal) out of Virginia put together a great Fair Housing and Hoarding Fact Sheet , which talks about "remedy plans" which may include help from support services. They also welcome landlords to call them at 513-721-4663 for advice on how to deal with this issue. As always, documentation is your best friend. As a landlord, you want to do what is right and respectful for everyone involved, while ensuring compliance with Fair Housing law.

A HELPFUL RESOURCE

Hoardingcleanup.com/Connecticut is a fabulous and very helpful site where resources can be found for help with hoarding from professional cleaning/organization companies, to psychologists/psychiatrists to message boards, support groups, and webinars.\

Have A Hoarding Tenant Causing Issues at Your Property?

Give Us a Call, We’re Experienced with Landlord Rescue!

Call Our Rental Advisor Directly: (860) 200-3331

5 Steps To Creating A Rental Ad That Makes the Phone Ring!

Tue, 06 Oct 2020 15:56:59 GMT

Let's Get the Right Tenants to Call You

Your rental ad matters. If you do it right, you will not only get the phone to ring nonstop, but will also ensure that the calls are from people with real interest - because who really wants to answer the "do you allow pets" questions again. Follow these five steps to create a winning ad and get ready to schedule showings.

S tep 1: The title counts - do it right

Depending on your market, your rental listing services (e.g., Craigslist, Zillow, Trulia) will be very competitive, and very crowded. You want to stand out above the rest. Let's face it, if they don't click, they won't call. A few rules to follow:

Rule 1 - Use proper caps in title (i.e., capitalize the first letter of each word). Zillow conducted research on Craigslist postings and found that views per ad were over 30% higher when following this simple rule. Rental listings using ALL CAPS in the title performed the worst. Not only is it hard for a prospective tenant to read, but it means you are SCREAMING at the reader.

Rule 2 - Keep it short and sweet. Again, in Zillow's research they found that the most viewed rental ads were the ones with the fewest characters. Don't take this too far though. It pays to be descriptive, which brings us to the next rule.

Rule 3 - Hook them with concrete benefits. We learned that brevity is good. We learned ALL CAPS are bad. Most important of all is to remember the marketing axiom "sell sizzle, not steak". To really stand out in a crowded market you need to sell the benefits of your rental. This doesn't mean dump the descriptive stuff - combine a descriptive title with benefit. "2 bedroom 1 bath in New Haven - Short walk to downtown" does both.

Rule 4 - Stay away from the fluff. "Awesome", "Nice", "Beautiful", etc. All of these are examples of words that are generic and overused. Try to stick to descriptive words in the title, or be warned - you may be the 15th "Nice" 2 bedroom in someone's search results. Not a good way to stand out.

STEP 2: GIVE THEM ALL THE INFORMATION YOU KNOW THEY WILL ASK FOR

In the days of newspaper classified listing you had to be frugal with not only your words, but your letters (e.g., EIK = eat in kitchen). That is not the case for online listings, and you should use that to your advantage. More is more, and more is better if it gives people the information to know if they should call for a showing. If you are getting phone calls that ask "Do you accept pets" or "How much is the security deposit", shame on you. Make sure you include all of this necessary information in the body of your listing.

Things you should include:

Amount of rent, security deposits, application fees, and any pet deposits.

Location of the rental (including maps if available).

Number of bedrooms and bathrooms.

Appliances - OK, people know a stove and fridge are included, but what about the other things. In unit washer and dryer? Dishwasher? These are not standard, and people are interested.

Pet policy - Cats, Dogs, Fish? What is allowed and what isn't.

Parking - on street, off street, garage? Make it clear.

Amenities - pools, fitness center, other? Highlight the features (and position as a benefit).

Contact information (including best time to reach you if appropriate).

One final note, make sure you are descriptive where it matters. If you have granite counter tops, say it. If you have stainless steel appliances, say it. It matters to prospective tenants and will help you stand out versus the rest.

STEP 3 - PICTURES SELL

If you are not posting pictures to your listing, start now. It is the number one thing to improve your traffic. In Craiglist many people will filter out ads that don't have pictures. Prospective tenants don't want to waste their time.

Not only should you be posting pictures, you should be posting "good" pictures. "Good" pictures are well lit, uncluttered, and include all the major parts of the house. The short list of pictures you should include: 1) the exterior of the rental, 2) the kitchen, 3) the bathroom, 4) the bedroom, and 5) the main living area. Again, more is more and more is better. At Robert C. White & Company we work to post a picture of every room and put them in the order you would walk through the house.

One other thing - we follow a truth in advertising policy. We feel that prospective tenants should see a picture of the "ugly" exterior, for example, and decide if they want to have a showing. Why waste their time or yours by hiding it early. You won't be able to hide it when they arrive to view the home. Also, if your bathroom or kitchen is so outdated you don't want to include a picture because people won't call, spend the money to improve it or adjust the rent accordingly. Y ou don't need to be a professional photographer to take "good" pictures for your rental listing. You just need to take your time, practice, and pay attention to details. Soon you will be giving the professionals a run for their money.

STEP 4 - MAKE IT EASY TO READ

Formatting and grammar matter. Please don't spend your time creating the perfect rental ad and stop just short of the finish line. White space is your friend. Make sure to break up paragraphs of text and use bullets for critical listed information.

Grammar matters for several reasons. First, and most importantly, some people make judgments based on blatant grammar problems and will pass on your listing. Second, with the rash of scams on Craigslist, poor grammar and awkward syntax are often a warning sign for people that the ad may be a scam. Please don't fall in that camp.

STEP 5 - VIDEO, THE FINAL FRONTIER

While not common yet, expect to see more and more video embedded in rental ads. Not only has editing and posting video become much simpler, the cost of equipment is now negligible (hello Mr. iPhone).

Video also increases the chances of a purchase. According to a study by the Wharton School of Business, prospects are 72% more likely to purchase a product or service when video is used.

The benefits of video for rentals are obvious. Prospective tenants can really get a sense for the rental and your phone calls will be from truly interested people. Also, when you are renting an occupied unit you will be able to significantly limit the disruptions to the current tenant. Several leading property managers are moving in this direction, and you may want to give it a try.

So that's it - 5 steps to make your rental listing stand out and make the phone ring. Let us know what has worked for you (and what hasn't) when creating your rental listings!

Unsure about marketing and leasing your unit? Give us a call! Our experts are ready to help get your property rented quickly for the best possible rate.

CONTACT US TODAY:

Email: info@robertcwhite.com
Main Office Line: 203-613-6290

or
Fill in The Form Below To Have Us Reach Out To You!

Vacancy: The Biggest Cost to Owner's of Rental Property

Tue, 29 Sep 2020 14:23:02 GMT

VACANCY IS TO STRESS: AS GLITTER IS TO MESS

Do you currently have a vacancy? Did you account for vacancy periods when you began your journey as a landlord? Whether you did or did not, times of vacancy in the world of owning a rental property hit hard- and mostly in the checkbook. The winter months especially, can pose unwanted stress on landlords like no others, having to worry about keeping a vacant space heated enough so pipes don't freeze, etc. Being in the business of property management, we know for a fact that VACANCY/TURNOVER is hands down the BIGGEST COST for owners.

OUCH, RIGHT IN THE CHECKBOOK

Every week or month that goes by un-rented = hundreds or thousands of dollars in lost revenue.While revenue is being LOST, bills are still being FOUND: mortgage payments, hazard insurance, property taxes, utilities, landscaping, snow removal, maintenance ….oh my! We’re not in Kansas anymore Toto.

The Season is Not the Only Reason

The time of the year is just one of several factors that impact vacancy periods. Here are some of the other violent offenders:

1.) Pricing- Too high? (compared to similar units and/or for the tenants you’re targeting).

2.) Condition/Age of the property- P roperty needs visible work? Is it pleasing to the eye?

3.) Location & proximity to amenities - Have you highlighted easy access to highways or public transportation? Is it near a historic district, university,or large employer? All pluses for renters.

4.) Visibility- Is the listing visible enough? Is it on multiple websites online (which increases chances dramatically)?

Expert Tip: The day a tenant vacates is when a handyman should assess repairs & begin the "make-ready" process. Days passing while he's "getting around to it" costs you $. Consider taking a video too (the camera never lies).

ZERO VACANCY RENT : A LANDLORDS DREAM

There is no magic number for the average days a rental is on the market for. A zero vacancy rent is a landlord's dream; however, there is a price to pay if not done correctly. If a place is renting in well below “the average time” (around 20-40 days depending on time of year) at least one of the following is probably true:

the rental rate is too low

the rental criteria is too low

You want traffic; but, an overabundance can be a red flag that you could be asking for too little in rent. As far as criteria is concerned, you should look for someone who makes at least 3x the rental rate in gross monthly income, has a positive rental history, and solid credit score. If your only criteria is having the 1st months rent & security deposit- don’t be surprised by problems down the road. On the other hand, if your rental criteria is too stringent (i.e., looking for perfect credit), you risk above average vacancy rates & getting whacked in the wallet longer.

Expert Tip: Include in your lease (as we do at Robert C. White) a clause that allows you to begin marketing and showing the unit before your current tenant vacates. If you can show the property while tenants are still in place, you may be able to eliminate any vacancy!

FILLING YOUR VACANCY IS OUR BUSINESS

As expert Property Managers, Robert C. White & Company understands your bottom line. The leasing team works tirelessly to fill vacancies ASAP after completing a rigorous screening process that has proven effective! With working, taking care of children, and other responsibilities, you probably don't have the necessary time it takes to get your home rented as quickly as it can be.

WE HAVE THE TIME! It's what we do. Give us a call today to see if we can help 860-613-6290.

Rent Specials & Offers to Attract Tenants Fast

Wed, 23 Sep 2020 16:10:44 GMT

What can we do to attract the right tenants quickly?

What’s the goal when listing a rental property? Quite simply, it’s to find the best-qualified tenants in the shortest amount of time. We want someone that can be trusted to pay rent each month and treat a property with care, but we can’t wait all day! Below we’ll discuss some of the special offers we use to get units rented quickly, without sacrificing our owner’s revenue.

Eliminate Application Fees

One of the simplest offers to drive in leads is to waive any fees associated with applying for a property. At RCW, we accept applications through an online system for a fee of $35. To some people, especially those that have already paid for applications at other units, this can seem expensive. So, if we think we’ve got a good candidate that’s on the fence about applying, it’s worth it to waive the app fee to get them to commit!

Give Security Deposit Special

If you’re not anticipating your new applicants to damage your property because you’ve screened them thoroughly and called their rental references, then a special offer on the security deposit really doesn’t hit your pocket as an owner. For a qualified group, we’ll often offer ½ off on the security deposit to save them some of the upfront cost in moving. This is a highly effective tool when you have a decent pool of candidates.

Offer Rent Specials

There are a few different rent specials that have worked for us at Robert C. White & Company. Probably the most effective of the rent specials is a free 1st month’s rent or ½ off 1st month’s rent with lease starting by a predetermined date. [Example: “Charming 2 Bedroom Apartment Downtown - ½ off your first month’s rent with a lease starting on or before 10/1] Scarcity is a big reason people make decisions to purchase, and if they think your unit is going to rent quickly, they’ll be more likely to request a showing and apply for the unit!

Another effective offer can be a decrease in the rental rate with an extended-term lease. Say you typically rent your property for $1,500/month on a 1-Year term. You also know that it costs you around $750 and 10-15 hours to remarket and get it rented each year. Why not then, offer a 2-Year term at $1,450, and lock tenants into a longer lease? If you break down the numbers in the above scenario, the owner saves themselves time and effort remarketing after the first year, and makes an extra $150 over the course of two! From our experience, longer-term tenants also tend to treat a property better and are more likely to extend their lease again.

Consider Waiving Fees

Another special offer that may entice the right groups is a promise to waive other fees normally associated with renting like pet, parking, or storage fees.

The thing about pets is, if you’re screening them properly and get a good reference from a previous landlord, it may make sense to waive fees or deposits to get quality candidates to sign a lease with you. Good pet owners also tend to be good tenants, so if eliminating a monthly pet fee is all it takes, why not try it? For the right group, waiving fees for extra storage space or additional access to parking can also be effective, especially when those fees aren’t greatly impacting your bottom line.

Try a Free Giveaway

One last special offer you can try in your property marketing is the “Free Giveaway...” everyone likes FREE! Gift cards, event tickets, move-in boxes, or even use of a truck on move-in day are all good examples of giveaways at lease signing. Sometimes a $50 gift card to the city’s most popular restaurant is all it takes for a couple to choose your unit over another!

The Final Word

Sometimes the market is firing and your rental property won’t require special offers or tricks to get it filled. At other times, like the dead of winter or the start of a pandemic, your rental property may be listed forever without a bite. When your property isn’t getting any hits, try mixing in some of the offers we’ve presented and let us know how it works for you. Rent specials, security deposit savers, and product giveaways are just a few ways you can attract quality leads fast when the market’s moving like molasses! Happy Hunting!

Have questions? Contact us directly at info@robertcwhite.com or (860) 613-6290. You can also submit the contact form below and we'll reach out to you in a timely manner!

Owner's Guide to Renter's Insurance

Fri, 11 Sep 2020 15:15:22 GMT

Renter's Insurance - A Must Have

Renter’s insurance is not often a priority for incoming tenants. We run into plenty of applicants who aren’t even aware that this type of coverage exists! With the recent effects of the pandemic and natural disasters always looming, it’s more important than ever to have tenants with their own renter’s insurance policy. The good thing is, renter’s insurance is beneficial to both parties in a lease agreement and comes at a fairly low cost to tenants. We think renter’s insurance is so important, that we require every tenant at Robert C. White & Company to carry a policy, keep reading to find out why!

What Does Renter’s Insurance Cover & How Does It Protect Tenants?

There are a few different coverage options available for renter’s insurance policies:

Personal Property Loss/Damages = The most typical renter’s insurance policy will cover the personal property of your tenants. If items are stolen or damaged inside of the property, insurance will cover the cost of replacement. Beyond theft, the policy would also insure items from fire, smoke, storms, leaks, and other conditions. Personal property that is commonly covered in these policies includes electronic devices, clothes, furniture, and minor appliances.

Liability = Renter’s insurance policies can also include liability for accidental damage a tenant does to your property during their lease period. In the event that a tenant does damage that amounts to greater than the security deposit, their renter’s insurance policy may cover those costs. Accidental fires and floods are more common than expected, which is why this piece is so important!

Loss-Of-Use = Tenants that are misplaced from your unit due to a natural disaster, fire, or flood would have loss-of-use coverage through their renter’s policy. This means that if they must vacate the unit for a period, the insurer would cover the cost of a hotel or other living arrangements.

If and when an emergency hits, your tenant will likely thank you for requiring them to carry a renter’s policy. We’ve all heard this... Hope for the best, but prepare for the worst!

How Does Renter’s Insurance Protect Landlords?

Even if a tenant’s personal property isn’t on the top of your list of importance, it could become a problem if the tenant decides to take legal action against you. Whether or not you’re held liable is one thing, but handling lawsuits is a hassle that ends up costing you time and money. Having renter’s carry an insurance policy ensures you’re not at risk if and when their things are damaged. A good renter’s insurance policy also puts your tenants in a better financial position in event of a loss. Because they won’t need to cover costs out of pocket, tenants will be more likely to continue paying rent or restart

payment in the event they are displaced for a time.

Should You Require Tenants Carry A Renter’s Insurance Policy?

Most simply, yes. You should require any new tenants to carry their own renter’s insurance policy. It gives both parties to the lease added peace of mind.

It is now standard practice for property managers and landlords to require this type of policy. When doing so, make sure you include terms in your lease that outline the requirement for renter’s insurance. Be transparent and detailed about the tenant requirements to purchase a policy for themselves. Just like a security deposit, you shouldn’t sign a lease with new tenants until they have provided you with proof of the insurance coverage.

This way, even if a tenant was to show you proof of coverage just to get the lease signed, and then cancels their policy after, you have a record of the interaction and document of it. You can then point to the lease violation if they take you to court, or have to go through an eviction.

Who Sells Renter’s Insurance?

Generally, renter’s insurance policies are very affordable and can be found through most major insurers. Geico, State Farm, Progressive, and other big firms offer competitive rates for comprehensive coverage. You shouldn’t require tenants to use a specific insurer or policy, but do ask that they carry liability coverage for property damage or injuries caused to other tenants. And remember, request a copy of any documents that prove an active renter’s insurance policy before signing the lease!

Final Thoughts

Renter’s insurance protects you and your tenants from loss, damage, and liability. Typically, these policies range anywhere from $5-$50/month, which also won’t hit your tenant’s pockets too hard! In times of emergency, accident, or natural disaster, a tenant’s renter’s insurance policy will cover costs and protect you and them from liability as well. Requiring it is best practice, so if new tenants have any concerns, simply run down the list of benefits and explain why it is so important!

Questions or comments about renter’s insurance? Do you require your tenants to carry an active policy? Tell us more in the comments below!

Landlords Guide: How to Conduct Virtual Showings

Tue, 01 Sep 2020 13:36:21 GMT

Landlords Guide: How to Conduct Virtual Showings

WHY GO VIRTUAL?

Now, more than ever, virtual tours are becoming increasingly popular- and even required in some areas due to Covid-19 regulations. But even when the pandemic ends and life returns to normal, there will continue to be many benefits in conducting virtual tours.

LIVE VS. PRERECORDED TOURS

There are two types of virtual tours to consider- live virtual tours and prerecorded tours- both having the same ultimate goal and content. A live virtual tour is a walk-through of a property that can be done via a video messaging service between two or more people. During a live virtual tour, the person providing the tour will essentially be doing a walk-through or “open house” with the interested parties. Live virtual tours are a great alternative to in-person showings, and allow you to personalize the showings for each person and answer specific questions as you move through the property. You will be able to highlight specific aspects of the home that the prospects are most interested in, and address any concerns on the spot. Live virtual tours are also an asset when it comes to working with out-of-state renters who may not be available to see the property in-person prior to submitting an application.

In addition to live tours, prerecorded video tours- or walk-throughs- are another great tool to use when marketing your rental property. Generally speaking, having a prerecorded video tour as a part of your advertising is always a good idea. The benefit to prerecorded tours is that you can do it one time when the property is vacant, and use the same video over and over again as long as there are no major changes to the home/unit. Having a video tour that prospects can view upfront prior to scheduling an in-person showing, can help you “weed” out individuals that may not end up being interested in the property. For example, maybe the layout of the home is a bit unusual, or the master bedroom is on a different level than the other bedrooms. A young couple may determine that the layout would not work for their family, and decide not to schedule a tour. Although the ultimate goal is to attract a quality tenant, it also helps you save time by avoiding unnecessary showings.

When conducting a prerecorded video walk-through, you will want to begin the video by stating the address of the property. It is best not to mention the date, or any time-specific comments such as “the walls are all freshly painted.” Because this is a prerecorded video and you may use it more than once, you don’t want to make any statements like this that will set the expectation that the walls/floor/appliances will be brand new each time. Best practice is to hold your cell phone sideways, so that you are getting a fuller, wider shot as you walk through the property. It is also suggested to open all blinds on a nice day, and to turn on all the lights so that your video does not appear dark and grainy. Typically, you will start at the front entryway, working your way through each room of the house and finishing outside. You will want to highlight any attractive features of the home in order to paint it in as positive a light as possible, while also giving prospects a realistic view of the property. A live tour will work in very much the same way, just giving you more of an opportunity to personalize the experience for each prospect.

THE FINAL WORD

When done correctly, virtual tours are an excellent supplement to your marketing efforts, and can assist you in greatly expanding your reach to prospects- all while saving you time and streamlining the leasing process. If you still have questions regarding virtual showings or are considering other leasing options, feel free to reach out to us at any time!

Info@RobertCWhite.com or (860) 613-6290

How Much Does Property Management Really Cost?

Thu, 27 Aug 2020 14:44:37 GMT

How Much Does Property Management Cost?

At Robert C. White & Company we meet with hundreds of owners each year concerning our property management services. While the owners often know a lot about us from browsing our website, one of the most common questions we get is, “ how much does a property manager really cost? ”

At Robert C. White & Company we value transparency in pricing. So here, we do our best to outline the costs and fees associated with hiring a professional property manager. You probably know already that property managers take a monthly percentage of the rent, but what other costs could you anticipate? Leasing and reporting fees are similar across the board, but which add-ons and optional services may you also want to feel secure? All this and more, answered!

Property Assessment and Market Analysis

Most property management companies, like Robert C. White & Company, offer a free property assessment and market analysis on your rental property. A licensed real estate agent can give you a suggested market rent for your property and evaluate maintenance/updates needed to be rent ready and get you the highest rental rate!

Initial Set-Up Fees

Like most service businesses, if you decide to move forward, you can expect an initial set-up fee. For property management companies this tends to be in the range of $100-200. This fee supports the initial work done to add you as a client, move your property into the system, conduct a takeover inspection, and set-up current tenants if appropriate.

Leasing Costs

100% of one month’s rent is the typical leasing fee. Leasing fees are only incurred once per tenancy, even if a group renews. If a tenant does choose to renew, you can expect your property manager to charge a separate renewal fee. Actively working to get leases renewed is an important way to reduce vacancy rates, keep turnover expenses low, and increase overall profitability. At Robert C. White and Company, we charge a flat lease renewal fee of $499.

Monthly Management Fee %

A professional property manager will typically take between 8 and 12% of the rental rate per the lease. For example, if rent was set at $2000 with a 10% fee, the management cost would be $200/month. At Robert C. White & Company, like with most property managers, there are also different tiers to choose from that will include added services and owner protections. Our fees here range from 10 and 14 percent of the monthly rent.

And what might you get for choosing a more expensive property manager or level of service? I can tell you that with our top tier package, appropriately named total assurance , owners get some awesome perks! They would receive increased pet damage protection, increased eviction protections, and guarantees against rent loss.

Additional Service Options

Note, the services listed in this section are not offered by all property management companies. However, the best of the bunch will have options like this that improve owner experience and can bring peace of mind!

Property Inspection Fee = $100-200/Inspection

Evictions Administration = $100-200

Bill Pay Service = $10-20/month

Insurance Claim Oversight = 8-12% of the claim

Owner Fast Pay = $25/month

Yearly Financial Report = $100-200/Report

Understanding the expected costs of professional property management is crucial. As a buyer, you’re now armed with information and expectations and are ready to evaluate the different services and offerings from property managers near you!

Don’t forget to download Robert C. White’s & Company's Detailed Pricing Packet --> HERE

Have More Questions About Property Management Pricing?

860-613-6290 OR info@robertcwhite.com

Rental Property Upgrades to Maximize Return on Investment

Mon, 17 Aug 2020 17:48:23 GMT

Rental Property Upgrades to Maximize Return on Investment

Property owners are always looking for ways to update and improve their units to get top dollar on rent and attract better tenants. There is no need for a total gut and remodel, but small improvements over time are your best bet! Put on your tenant glasses, step into their world, and evaluate as if it’s your first time seeing your property. Then you can decide what changes make sense at your property and would provide the best return on investment.

Fresh Lighting

Sometimes the simplest things are the ones that make a difference. An upgrade to lighting can be that small addition to a rental space that makes it feel inviting. Installing new light fixtures and making sure all lights are working in the property before showings make a difference.

Add Fencing

Many renters, especially those looking at single-family homes, have pets or small children as a part of their family. In those instances, fencing around the entire property or the back yard can be a massive bonus for renters. Consider

Paint it New

Walls are the first and most noticeable item potential tenants will get a glimpse at. A fresh coat of paint can go a long way to improving the look and feel of a unit and allow you to get top dollar on rent. We recommend light neutral colors to make the unit feel as open and clean as possible. If you have multiple units or multiple properties, settle on a universal paint color so you can buy in bulk and save time selecting each time around too!

Weeding and Mulching

Before folks enter a unit to look at the living space, they will drive up and see the exterior of your rental property. First impressions are crucial, so Improving curb appeal with weeding and mulching can make all the difference when marketing a rental and hoping to get top dollar. Hiring a professional or cleaning up flower beds yourself is a relatively inexpensive way to increase tenant satisfaction and will improve your chances of marketing and leasing quickly at the rate you want!

Install Smart Thermostats

Whether tenants are paying for utilities or they are included in the rent, smart thermostats are your best bet these days. Giving tenants the ability to control their heating/cooling on a timed system will provide them with a better renting experience and save money for you and the tenant in the long run. Smart thermostats have become much more affordable and are an instant improvement to any rental opportunity.

Install New Locks

Another relatively affordable upgrade is to install new locks at your rental property. Tenants want to feel safe in the space they are in, so let’s give it to them. Consider installing new locks on all entryways (shared and private) to provide new renters with security. Installing smart locks may also be an option and one that will allow you to ask for a bit more in rent!

Update Appliances

You don’t have to outfit the kitchen in high-grade stainless steel to improve the look. Tenants always want to take a look inside the fridge and the oven to make sure they aren’t old and caked in dirt and grime. Choosing to replace aged appliances immediately lifts the unit and lets prospective tenants know you are serious about providing the best experience for your renters. Kitchen and bathroom updates tend to give the best ROI, so starting here wouldn’t be a bad idea.

Add Laundry Hook-Ups or Laundry Units

Modern amenities, like in-unit laundry, are becoming more of an expectation than a wish. Especially for young professionals that are frequently busy, having laundry hook-ups or machines provided inside of the unit is a big bonus. Typically, you can charge $50-100 more each month in rent if your unit has laundry options in an apartment or at least on-site at the building. Adding laundry isn’t the quickest or cheapest upgrade on the list, but it can certainly offer a good return on your investment.

Pressure Washing

Many times, tenants pull up to a property and immediately notice that siding or sidewalks are dirty and covered in green slime. Renting a power washer for a few hours to clean the sides of your building and clear off walkways is an instant boost to curb appeal. We said before, first impressions are critical, and if you want to get top dollar for rents, don’t expect to do it with white siding that has turned a shade of green!

Create a Designated Pet Area

Pets are popular, let’s face it. According to the Humane Society, over 70% of renters have a cat or dog with them these days, so to deny them would be foolish. But what can we do to increase ROI and tenant experience regarding pets? By creating a designated pet area. Especially useful in multi-unit buildings, a separate pet area keeps some of the outdoor space clear and clean while giving animals a chance to operate freely in their area without disrupting other tenants.

Consider these ten items, and plan to work on one or two of them each year to make things manageable. You’ll be able to lock in new tenants at a higher price point if you’re always improving the condition of the property and bettering the renter experience along the way. Good luck!

___________

Want to Receive a Free In-Home Make Ready Evaluation?

CALL US TODAY at (860)-613-6290

We’ll run a quick rental analysis on your property first. Then, once we’ve determined the appropriate rent valuation, our advisor can tell you exactly what areas need improvement to get your property ready to rent for more!

8 Questions You Must Ask Before Choosing a Property Manager!

info@robertcwhite.com (Luke Eddinger) — Tue, 04 Aug 2020 13:50:33 GMT

8 Questions You Must Ask A Property Manager Before Signing a Contract!

Shopping for a property manager and wondering what questions you should have? Here we tell you exactly what you should be asking a property manager and what responses to look out for. Robert C. White & Company it’s all about transparency, and we want you to find peace of mind no matter what property manager you land with!

What’s Included in Your Services?

The first thing you’ll want to find out is what kind of services are included as part of the property management package you’re thinking about. Some managers may offer rent collection and maintenance oversight but exclude things like financial reporting or help with evictions processing. You’ll want to know exactly what is and is not a part of the service contract you’re considering. As an example, Robert C. White & Company offers these eight services at every level of our property management plan: rent collections, property marketing, tenant screening, maintenance oversight, property inspections, financial reporting, evictions help, and legal guidance!

What % Fee Do You Charge?

Some property management teams offer a flat rate no matter the property type or level of service provided, while others use a tiered system depending on the PM package you’re purchasing. Ask the company you’re considering exactly what their monthly charges are and which of the services we discussed above may be included. Going with the cheapest property manager often isn’t the best option because you’ll have limited services and likely fewer contact points along the way. The property management team that understands the value they add may charge more, but may also put more money in your pocket by staying on top of maintenance items and being more efficient with marketing + tenant selection!

What Additional Fees are There?

You may know what percentage you’ll pay monthly for property management services, but what other charges can you expect? Make sure you have a breakdown of all possible expenses associated with your property management service. Releasing of the property, among other things, often has a separate charge associated. If you want additional items like rent loss protection or evictions services, those likely have added cost as well. Nobody likes surprises, and a good property manager should be transparent about all of their fees!

What Protections/Guarantees are Included for Owners?

If you’re paying for a professional property management service, you’ll want to ask them what kind of owner protections are in play before the contract is signed. Many companies won’t charge you while your property is vacant, but what about liability for placing a bad tenant or pet damage? Find out if the property manager you’re hiring offers any landlord protections to their clients. Another example from Robert C. White & Company is our “ Quality Tenant Guarantee ,” which means we stand behind the tenants we select. If we place a tenant in the property and we ever have to terminate that rental agreement with the tenant due to poor performance or breach of contract, we will replace them with a new tenant and the leasing fee for the new tenant is FREE . This kind of guarantee insulates the owner from loss of revenue and brings added peace of mind, which all good property managers should do for you!

What is your Average Time to Rent a Property?

Your property manager will likely be taking over the marketing and leasing for your property, and you want to be confident in their ability to get this done quickly. Heck, if you can avoid vacancy all together, that’s even better! Before you sign a contract with a property manager, inquire about their listing process, and ask how long it usually takes them to place a tenant. A smart management team should be able to market at the right rate and find a high-quality candidate quickly and efficiently!

What are your Strategies for Marketing and Pricing a Property?

With a property management company readying to take over your property, you’ll want to ask them about their strategy for setting the rental rate and marketing your property. Make sure you’re getting a comprehensive market analysis from a real estate professional that will compare and analyze your property with similar local listings! Then you should ask about where your property will be listed and syndicated? Most renters today shop online, so the use of Multiple Listing Service, Zillow, Trulia, and other hosting sites is critical.

Want to see how Robert C. White Does It? Click Here To Learn About Pricing A Rental Property.

How Many Properties Do you Manage/What’s Your Experience with Properties Like Mine?

At RCW, most of our portfolio is made up of single-family homes and condominiums, but we also have experience with multi-family properties in select locations. Before signing, ask your new property manager for information about their portfolio and what kind of experience they have with properties similar to yours. Just because they have a history of success renting out 1-bedroom apartments near the city, that doesn’t mean it will translate to single-family rentals in suburban areas. Get someone that knows your property type and the local market!

Am I Signing a Long-Term, Binding Contract?

Last but not least, make sure you understand the fine print in the contract you’re signing. Robert C. White & Company offers a unique “Burn the Contract” Guarantee , meaning we don’t hold any of our clients to a long term agreement. If you’re unhappy with your property manager, it’s our firm belief that you should be able to cancel the service at any time at no cost! So, ask the property manager if you’ll be able to leave at any time and if there are any cancellation fees associated.

Starting with these 8 questions will give you the best chance at finding a property manager that suits all of your needs and is ready to take on the challenges associated with your rental property!

Want more information about RCW’s services and fees? Follow the link below to request a free, no-obligation market analysis, and set up a call with Sam, our Rental Advisor!

SECURE YOUR COMPREHENSIVE MARKET ANALYSIS HERE!

What Will My Property Rent For?

info@robertcwhite.com (Luke Eddinger) — Tue, 28 Jul 2020 19:59:42 GMT

What Will My Property Rent For?

Things To Consider

Comparable Listings - The first thing you’ll want to look at is comparable listings in your rental area, and you don’t need access to the multiple listing service to find similar rentals! As a landlord, you can use Zillow, Trulia, and other open listing sites to your advantage. Start a search for units with the same number of beds/baths, approximate square footage, utilities, and upgrades to compare to your property first. Make sure you take a look at pictures and walkthrough videos of these other properties so you compare and contrast only rentals that are highly similar to yours! There is no such thing as an exact match, but you’ll feel better moving your list price up or down once you’ve got an idea of what else is out there.

Seasonality - Many forget to consider the season that they are renting in when they prepare to list again...don’t be that landlord! Prime months for rental listings are April-September, and marketing outside of these months could see your rates drop as much as 10%. Before you price your property, you need to be aware of this and understand the number of renters looking for new rentals is limited during the fall and winter months. Be ready to adjust your list price to find tenants as quickly as possible even during off-peak seasons.

Risk Profile - You have to consider your risk profile when listing your rental property as well. If you can sustain some time in vacancy and still be profitable or at least break even, then maybe you’ll want to start with a higher listing price and adjust over time. On the flip side, if you need to fill a unit for some quick and immediate cash flow, you may adjust down and take less in rent to avoid prolonged vacancy. Is it worth your time to hold out for tenants that are willing to pay a bit more?

Improvements - Making improvements to your rental property could also be useful, especially if you’re in a high-desirability area. Simple improvements like adding in-unit laundry may only cost $1000 but allow you to market for an extra $100/month for the foreseeable future. When you’re flipping through images of comparable listings, try to get an idea of what other owners in your area are doing to improve their properties. You won’t attract high-level tenants that are ready to pay a useful rate if your unit is deteriorated and outdated. Keep an eye on the trends!

Free Comprehensive Market Assessment

At Robert C. White & Company we provide a comprehensive market assessment Free of Charge . We’ll take into account the location, property type, current condition/rental rates…and more when analyzing your property! With units that Robert C. White & Co. listed for rent in 2019/20, we averaged just under 20 days from list to deposit and helped avoid vacancy in most instances. Here’s what we can do to get you moving in the right direction next time you list for rent!

We’ll put together a list of comparable properties to start. Our agents use Connecticut’s Multiple Listing Service to compare your property with current listings in the state. With this, we get a clearer picture of the local rental markets we operate in and can give you the most accurate and up to date information available! On the MLS we can also see the close date and closing price. This means we can tell you exactly how long similar properties were listed for and how prices were adjusted over time to find tenants.

If you’re interested in learning more about our property management services or getting your free comprehensive market assessment, we’re ready and willing to assist!

WANT TO CLAIM YOUR FREE COMPREHENSIVE MARKET ASSESSMENT NOW?

Simply enter your details below and we’ll reach out within 48 hours!

Secure Your Comprehensive Market Assessment

How To Guide: Setting Up A New Rental Property

info@robertcwhite.com (Luke Eddinger) — Thu, 23 Jul 2020 15:15:20 GMT

How To Guide: Setting Up A New Rental Property

Getting ready to begin leasing your rental property? Here are a few tips on how to prepare, prior to placing a tenant:

Prior to listing your property, it is best to schedule and complete any make-ready work that needs to be done. It is advised to complete any major/minor renovations, appliance replacement, flooring work, and painting before you start showings. This way, prospective tenants know exactly what they are getting, and you aren’t left rushing to finish up unfinished projects at the last minute. If there are any small or minor fixes and touch-ups that need to be done while you are showing, just be sure to set expectations with prospective tenants so that they are aware of any changes/improvements that will be made before they move in.

If you are planning to list your property for rent on your own, you will want to complete a fresh rental analysis before doing so. If you have access to the MLS, this is the best and most accurate way to determine an appropriate rental price. Not only can you see what similar homes were listed for, but you can see the rate that they actually “closed” for. If you do not have access to MLS information, you can get an idea by browsing around on sites like Zillow and Realtor.com. If you have a single-family home, make sure you are looking for rental properties that are of similar square footage, and have the same number of bedrooms and bathrooms. You’ll also want to take into consideration the kind of finishes and updates that exist in other rental properties. Is your home more or less updated than the others? You’ll want to adjust higher or lower within the range that you are seeing to account for those variables. If you are renting a condo or unit within an HOA or specific community, the very best comparables will be other properties within that same community. Keep in mind that the rental amounts you see online for active properties are what is being asked for, not necessarily what the owner will end up getting, so be prepared to make adjustments to the price if necessary.

If you are planning to use a Realtor or Property Management company to lease the property, then they will be able to complete a full rental/market analysis for you, and determine what the best listing price is for your rental (Pssst...Robert C. White & Company offers this for free!). They will also be able to monitor the amount of interest they are receiving on the property, and advise you of any adjustments that may need to be made.

Assuming you decide to market the property yourself, you’ll want to create an effective rental description and compile all of the information that you will need for your listing. Learn RCW’s tips for creating a stand-out rental listing here . It is also strongly advised that you have professional photos taken by a Real Estate photographer. High-quality images are super important, especially when most renters are going to be finding your property online. Presentation and first-impressions are key to renting your property fast.

Next, you’ll need to decide on a showing schedule. The easiest way to do this is to determine set days and times throughout the week during which you will schedule all showings. This will keep you organized, and prevent you from running back and forth to the property a hundred times per day.

Lastly, prior to finding a tenant, make sure to have a screening process/criteria determined and a lease drafted and ready to present. Once you find a tenant that is excited about your property and meets all of your requirements, you’ll want to be able to move forward right away and get them into a lease. Happy renting!

Simple Tenant Screening Guide: For Landlords

info@robertcwhite.com (Luke Eddinger) — Thu, 23 Jul 2020 14:17:53 GMT

Simple Tenant Screening

There are some bad tenants out there, full stop. They don’t pay rent on time, cause unnecessary damage to your property, or disturb other renters around them. As a landlord, selecting the wrong group usually means more time managing your property and less return on investment. We outlined some simple screening tips here so you can avoid problem tenants and land a qualified group that will treat your property with respect!

Our Six-Step Process:

Verify Income - Request that groups submit pay stubs, offer letters, and tax forms to verify income levels that match what was reported on their application. If you’re dealing with a self-employed applicant, it’s good to require two years of tax returns and bank statements to be extra vigilant. Generally, Robert C. White & Company looks for an applicant with gross income at least 3x the monthly rent.

Analyze Credit Reports - Outside of verified income, credit is the best indicator of whether or not applicants are financially responsible. You’ll want to require a detailed report so you can analyze their credit scores, open trade lines, and debt to income ratio. We suggest setting a credit score minimum between 600 and 650 depending on the type of property and it’s location. Of course, if you have a higher-end rental, you can always increase your credit minimum!

Verify Identity, Work, and Current Residence - You should also ask prospective tenants to submit a copy of their government-issued photo ID. You can use this to verify their identity and current place of residence.

Check Rent References - Another thing you must do to screen for quality tenants is to call their previous landlord. If a group of applicants is already renting, you will gain insight into how they treat the unit they’ve been in before by talking with a reference. If you can contact more than one landlord, even better!

Sample questions to ask a landlord reference:

Did the tenants pay rent on time, if not, how often were they late?
How many pets did they have, and did the animal cause damage or disturbances to others?
Would you rent to this group again?

Complete Background/Eviction Search - A thorough background and eviction search is a necessary tool for any tenant screening as well. If there is a troubling history of legal issues or past evictions, those are applicants you’re likely to avoid. Ongoing evictions won’t always show up in your check either. Be sure to search the CT judicial website (https://jud.ct.gov/housing.htm) for any current disputes that have not been resolved or reported.

Screen The Pets - Don’t forget to ask an applicant about the pets they would bring to your unit as well. Animals can cause damage in a unit or disturbance to the surrounding tenants, especially if they have an owner that isn’t attentive and aware. If possible, ask for veterinary documents that show the animals are properly registered and vaccinated as well.

There you have it, a simple six-step process you can use to screen applicants to your rental property. If you’re thorough here, picking the perfect tenants will be a stroll in the park, and you’ll have fewer headaches to deal with!

Looking for More Tips on Screening Tenants?

Access to Robert C. White & Company’s Exclusive “ NO-NONSENSE TENANT SCREENING GUIDE ” is now available in its entirety.

Setting The Right Rental Qualifications

Fri, 10 Jul 2020 19:56:53 GMT

Setting The Right Rental Qualifications

What’s the end goal when outlining your rental criteria? To ensure you get a high-quality tenant that pays on time, will be respectful and responsible in the unit, and follows the rules of your lease agreement. Not too difficult, but we want to make sure your rent qualifications are in line with Fair Housing guidelines too. Let’s get to it!

We’ll start by discussing the benefits of having predetermined rental qualifications. The first thing it will do is streamline your process. If any interested parties are not up to your minimum screening criteria, you can decline them in advance. This saves you time showing the property, running credit and background checks, and calling references. Setting qualifications ahead of time also reduces the chances of a fair housing lawsuit. A universal standard removes the subjectivity and forces you to look only at the important factors!

Before we get into more detail, here is a simplified list of the typical criteria we would look for:

• Income - Gross at least 3x the monthly rental rate

• Credit - Scores 650+, few/no late payments or accounts in collections

• Background/Evictions - Clean criminal and evictions history

• Rental History - Good landlord references

• Pets - To be accepted at the owner’s discretion

When you write your rental listing and set the qualifications you’re looking for sound financials first and foremost. If you expect your tenant to be able to pay rent on time, what do you want to see from them? I imagine you’d also like them to respect the property and not cause excessive damage or disturbance to tenants around them, so let's delve a bit deeper!

Income Qualifications - Total gross income (for individuals or a group) should be greater than or equal to 3x the rental rate. In condos or single-family homes where rental rates are typically higher, you may look for income closer to 4x. The best income is from established employment and should be verified by recent pay stubs and/or tax returns. And for self-employed applicants, require multiple years of tax returns.

Credit Qualifications - Scores above 600 are usually acceptable (though we prefer 650+). When analyzing credit reports, you should not accept someone with multiple delinquent accounts or accounts recently sent to collections. Again, with slightly more expensive rentals, you may want to increase the credit criteria as well.

Pro-Tip = if an applicant’s credit score is close, but not up to your criteria, analyze further by looking at what type of debt there is. School and medical bills are less concerning than outstanding car bills, unpaid utilities, or credit cards!

Background/Evictions Record - You’ll want to see a clean background and evictions record for any adult. Criminal records should not contain convictions for crimes involving violence, drugs, firearms, assault/battery, or sexual offenses. Evictions in the last 3-5 years are also a major red flag and grounds for denial.

Rental History - Applicants should have a good rental history that indicates they complied with all the terms of their previous lease. You should require that applicants provide contact information for their most recent landlord(s) so that you can make contact. Previous landlords are a great resource for finding out how tenants cared for their unit and whether or not they paid on time!

Pro-tip = Always end your conversation with a landlord reference by asking this before you hang up: If these tenants applied to another of your units, would you rent to them in the future?

Pets - This can be a tricky one! Pets should be accepted at the owner’s discretion but will vary by unit/property type. Breed restrictions are helpful, and it is smart to set size/weight limits on pets too. Before setting your pet criteria, you’ll also want to check with your renter’s insurance policy so you can be clear about what animals can or cannot be accepted. Be careful with applicants who have service and emotional support animals though! These animals cannot be a reason for denial in the state of CT.

Now that you know how to set effective rental qualifications, you’re prepared to make sound decisions on who to accept or deny. To stay in line with fair housing law, base your next tenant selection only on the objective facts discussed here.

If you’re seeking additional advice or answers to property management and leasing questions, please contact us at 860-613-6290 for a no-obligation Discovery Call. Our team of agents is ready to assist at any time because they love what they do!

Owner's Guide - Writing Rental Listings that Impress

Thu, 02 Jul 2020 18:13:47 GMT

Owner's Guide - Writing Rental Listings that Impress

Congratulations, you’re ready to start marketing your rental property! In addition to quality pictures, one of the simplest but most effective ways to market your property is with a thorough property description. Your description will be seen by agents and prospective renters alike, and will serve as the main source of qualifying information for those who are interested in your property.

So what is the goal? A solid rental listing description should “sell” your property to a well-qualified tenant as quickly as possible, while weeding out prospects that may not be a good fit. Rental listings typically get a lot of attention, and the last thing you want to do is spend hours fishing through applications from under-qualified applicants, or answering call after call from people who are just trying to find out information from you. A good rental listing description will provide prospective renters with all of the information they need upfront, saving you a lot of time on the back end.

Step 1: First, provide the basics. List the number of bedrooms, bathrooms and total square footage of the living area. Describe any finishes or details that you believe are worth mentioning. Next, highlight other features like a finished basement, garage space, storage area, on-site or included washer/dryer, fenced in yard, etc. Is the property close to any highways, popular local areas or universities? Is the rental located in a complex or community with amenities? Provide any and all information that you feel would make your rental attractive to a prospective tenant.

Step 2: After you finish describing the unit, move on to the important facts that prospective tenants will want to know. What utilities are included or not included? What type of heating/hot water system is in place? Is there assigned/unassigned/off-street parking? Who is responsible for lawn maintenance and snow removal? Are pets allowed, would they be considered, and is there an additional pet rent/deposit being charged?

Step 3: The last thing you’ll want to do is make clear your rental criteria and application fee. Include the minimum credit score that you would consider as well as your income requirements. Are you asking for one month’s deposit? Two months? Make sure to check with local regulations to determine how much of a deposit you are legally allowed to collect. In the state of Connecticut, a landlord is only allowed to charge the equivalent of two months rent in total deposits- this includes any pet deposits and does not apply for individuals over the age of 62, where only one month’s deposit is permitted.

By the time you have completed these three steps, you should have an informative and thorough description for your rental property that can be used over and over again. This, combined with quality photos and timely follow-up of rental leads, will assist you in finding the perfect tenant.

Why Every Landlord Should Consider Pets

Thu, 02 Jul 2020 18:08:09 GMT

Why Every Landlord Should Consider Pets

According to The US Humane Society, more than 70% of renters have a pet. That is more than ⅔ of the potential tenant pool! With that said, a smart owner would never turn all of these groups away without at least considering. While there are certain risks associated with pets, proper planning, and screening will help you avoid a bad selection. Below we break down the risks and rewards when allowing pets, and give tips for preparing your unit and your lease agreement for a tenant with pets!

The Benefits

Larger Applicant Pool - this benefit is easy enough to explain. Even if we assume that only 50% of renters have pets, by blocking them altogether, you significantly limit your applicant pool. You’ll want to pick from all possible candidates, rather than just a few!

Better Tenants - throughout 1000’s of tenant selections at Robert C. White & Company, we’ve found that tenants with pets tend to be more responsible and trustworthy. There are certainly bad pet owners out there, but our simple pet screening process (explained below) will help you avoid those groups to pick a reliable tenant. Allowing pets is an additional provision that may make tenants happier in the long run as well!

Increased Revenue - if you’re going to allow pets in your unit, you can increase revenue by simply charging a pet fee. Most renters are agreeable to pet fees because they understand their animal will leave more wear and tear on a unit. At RCW we typically charge $25/month for each pet allowed in a rental.

Increased Renewal Rates - because many other landlords don’t allow pets in their units, there is an increased difficulty in finding rental properties for tenants with an animal. Because of this, your property is more likely to retain tenants that are uncertain about moving because of the animals they will bring with them.

The Risks

Damage to unit - the most obvious risk with allowing pets in your rental property is damage done to the unit. Dogs and cats tend to scratch floors and walls and leave behind unwanted odors, meaning landlords have increased maintenance and repair costs.

Disturbing neighbors/other tenants - tenants may also have animals that are loud or rambunctious and disturb other tenants in the building or the neighbors!

Injuries to other persons/pets - untrained animals may also cause injury or harm to other persons or pets nearby. As a landlord, you don’t want to be held liable for any harm done, so be sure your tenant has the proper renter’s insurance.

Insurance & Restricted Breeds

Shop good renters insurance - Make sure that you’re comfortable and knowledgeable about your insurance policy. Check with your provider to ensure pets are allowed and get a list of any restricted breeds/types of animals.

Restricted breeds - many insurance policies have restrictions, but as an owner, you can also choose to put restrictions in place yourself. At Robert C. White & Co we typically deny the following dog breeds:

Pit Bull Terriers, Staffordshire Terriers, Rottweilers, German Shepherds, Presa Canarios, Chows Chows, Doberman Pinschers, Akitas, Wolf-hybrids, Mastiffs, Cane Corsos, Great Danes, Alaskan Malamutes, Siberian Huskies, and any mixed breed with any of the listed breeds in their lineage.

How To Screen Pets

Pre-Screening - before accepting a tenant with pets, you’ll want to prescreen the animals just as you would with their owner. We recommend running through at least the following list of questions with an applicant before consideration. Vet documents and pictures of the animal are also helpful.

Ask Them:

How many pets do you have and what kind of animal are they?

Height, weight, age?

Breed of dog?

Are you pets licensed and properly vaccinated?

Is your animal(s) friendly with other people/pets?

Making Your Unit Pet Friendly?

Install durable, cost-efficient flooring - yes, renters want to live in nice units and flooring can be a big factor, but don’t go overboard! If you’re likely to rent the unit to someone with pets, go with vinyl, linoleum, or faux wood flooring for a decent look that won’t break the bank or get damaged too quickly!

Fencing - a fenced yard, especially with single-family rentals is a massive bonus for pet owners. Consider installing one or allowing tenants to erect a semi-permanent fence themselves.

Create a “pet area” - especially in multi-unit buildings with more than one pet, a pet area in the yard may be critical. A dedicated area for owners to interact with the animals and allow pets to relieve themselves will make maintaining the lawn and landscaping much easier!

In the Lease - Pet Addendum

The last piece of the puzzle when it comes to allowing pets is to create a rock-solid pet addendum to include with the lease agreement. Make sure that you outline the following items in your pet addendum.

Tenant responsibilities - outline any tenant responsibilities regarding pets in your addendum. Your tenant will likely need to pick up after their animal, agree their pet will not cause disturbance to other renters, show up to date license and vaccine records...and more!

Pet deposits and fees - this is also a place to clearly outline any pet-specific security deposits or monthly fees that are associated with the animals. If you fail to put this in writing, you won’t be able to require the tenants to pay it. If you are going to charge a pet fee(s), make sure the cost of rent stays in line with other comparable units.

Wrapping Up

One last thing to mention before we wrap up, be careful with service animals! In the state of Connecticut, it is illegal to deny a tenant with a properly licensed service animal in your properties unless they are not meeting other rental requirements or qualifications.

Now that you understand the risks and benefits associated with pets in your unit, you can make a sound decision on how to proceed. At Robert C. White & Company, we recommend that all of our owners at least consider pets in their properties. If you have any other questions about our pet policies or screening process please give us a call at 860-613-6290 !

Picking the Perfect Investment Property

Mon, 22 Jun 2020 20:36:13 GMT

Picking the Perfect Investment Property

Robert C. White & Co’s experienced agents and property managers know exactly what a good investment looks like. We also know where to place our focus when analyzing an investment. Whether you’re new to owning or just started your search for income property, focus your spotlight on these key factors. The most successful investors create simple processes and implement them over and over for repeat business.

The Big Five

Rental Income - How much rental income is the property generating now, or will it generate in the future? This is THE key factor. If you’re thinking about purchasing a particular property, be sure rent rates are competitive with comparable units in the area and will at the very least cover mortgage, taxes, and expenses.

Location - Is the property in a desirable location and what is the vacancy rate like in the area you would purchase? Buying property in a more desirable location will affect the time it takes to find new tenants and the type/quality of applicants you’re attracting. For example, buying near a college campus may mean that your tenant pool is filled by inexperienced renters more likely to cause damage. In contrast, buying within a city center experiencing rapid business growth, you might expect young professionals with established income, credit, and rent history.

Amenities - Related to a property’s location are the local amenities on offer. Renters love to be near parks, shops, cinemas, and other features. If you’re considering an investment property, take into account the amenities in the surrounding neighborhoods. You’ll have an edge up on comparable rentals if you’re listing in a more charming and alluring part of the town or state!

Property Taxes - You’ve got to consider the taxes when deciding on an investment property as well. High taxes aren’t always bad, especially in desirable locations where you may be able to find long term tenants, but check the rates before making your move to purchase. You can find all the tax information for individual towns/cities fairly easily. You should also try and gauge whether or not an area is declining or improving. If local businesses are leaving a town/city, individual property taxes will likely go up soon. If tax rates rise too quickly, they can be the difference between a solid investment and filing bankruptcy!

Useful Unit Layout - Most renters are looking for functionality and affordability. Rentals that have a quirky or unique layout may seem interesting but usually aren’t a tenant's first choice. Consider a situation where two roommates are looking to rent together and come to see your two-bedroom rental. They’re unlikely to choose it if one bedroom is built for a grown adult while the other is the size of a small closet with six and a half foot ceilings! Purchase property that is desirable to the type of tenants you expect to fill it with.

Good investors will always consider these elements when purchasing a new rental property. Most cities have wonderful neighborhoods and properties that would make smart investments, but you’ve got to be willing to put the groundwork in first and do the local research necessary. Robert C. White & Company has helped investors across the state to manage effectively and find more property to add to their portfolios. Happy Hunting!

If you’re looking for more information or would like to speak with an RCW agent/property manager, click here!

Rent or Sell: Homeowner’s Cheat Sheet

Mon, 15 Jun 2020 16:00:43 GMT

Rent or Sell: Homeowner's Cheat Sheet

It happens to everyone, eventually. Work calls for a relocation or your family anticipates another child and all of a sudden you have to move. When the unexpected occurs, you’ve got to be able to make a quick, smart decision on whether to rent or sell your current home. That’s why Robert C. White & Company created this cheat sheet. To help homeowners focus on a few key factors in the decision making process.

Your Property Value

The first thing to consider is fairly obvious, what’s your investment worth now and where do you see property values going? It is likely that your home is worth more now than what you bought it for. However, some towns and cities have not seen a real increase in property values over the last 5-10 years. In areas that have not experienced recent growth, it may make sense to hold on to your investment and rent it out while values increase. This is especially true if new businesses or revitalization efforts are generating momentum in your area!

Consider Renting If:

Current home values are low
Your property projects positive cash flow
Minimal make-ready is required
Low local tax rate
Anticipated increase in property values
Have time to manage tenants and maintenance items

Consider Selling If:

Home values are up
It’s a high volume sales period
Your property projects negative cash flow
High local tax rate
Declining location desirability
Don't have time to manage maintenance and tenant requests

Will It Cash Flow?

The next big thing is the potential cash flow of the property. Start by finding the expected market rent for your property (Link to rent analysis offered free by RCW!) with the help of a local real estate professional. Once you know the rental income your property would bring, it’s time to run the numbers. Below is the formula to calculate a property’s yearly cash flow and an example for you to chew on. Cash flow for the property here is $4,775/year, and positive cash flow is great!

Cash Flow = Gross Rental Income - Payments (mortgage/taxes/fees) - Avg. Yearly Maintenance Expenses

$4,775 = $28,200 (12 months x $2,350/month rent) - $21,600 (12 months x $1,800/month) - $1,825

Managing the Tenants

So you understand your property’s valuation and the cash flow to expect if rented, great! There is one more big factor in this…are you ready and willing to handle tenants? Being a landlord requires a high level of care and responsibility for tenants. This is someone’s home, so prompt and reliable service will be important to them. Dealing with tenant requests and maintenance can be time consuming and require lots of back and forth, but if you’re willing to develop sound processes and manage relationships efficiently, you're on your way to being successful!

A Final Word

Deciding whether to rent or sell is a choice you can make only after considering the options and analyzing the property as an investment vehicle. Use this cheat sheet to help make a smart and informed decision that you’ll be happy with!

Want to see how RCW manages properties in your neighborhood? Contact us!

Before You List, Check This List!

Fri, 01 May 2020 16:31:52 GMT

Follow These Steps

Here are a few actionable steps landlords should take to ensure they are getting optimal revenue out of their units. The suggestions you’ll find here are often overlooked, but will make landlording easier and more profitable when you’re ready to rent again!

1. Have a lawyer review the lease agreement you’re using.

A lawyer can make sure there are no holes in your lease agreement that will cost you revenue. If your lease is missing just one term or clause, the tenant may be able to underpay or leave damages unrepaired upon move out. A lawyer should also make sure that your lease is in accordance with fair housing laws. Owners that are found in violation put their revenue at risk, so employing legal counsel is a precautionary step to ensure you don’t miss out on rent or other monies owed.

2. Take care of hazards or safety issues at your property.

Make sure there is nothing at your rental property that could cause harm or injury to a tenant. Landlords have an obligation to provide a safe and habitable living space and will want to if they also have a desire to maximize revenue! If during a lease term, your property is deemed unsafe or unlivable, your tenant may be able to go without paying rent or sue you for not providing a safe living environment as promised.

3. Establish strong rental criteria for tenants

Make sure you set qualifications that you’re comfortable accepting. High quality tenants pay their rent on time, alert landlords to maintenance issues quickly, and don’t do excessive damage. All the qualities you’ll find in a good tenant mean more income at your properties. Clearly identifying your rental criteria will save time in screening applicants as well. And less time in screening and showing means shorter vacancy with increased revenue!

Professional Screening Tip: You may be asking what constitutes strong rental criteria? At Robert C. White & Company, we recommend owners only accept applicants with gross income at least 3x the rental rate and credit scores 650 or better! Tenants that are spending less than 30% of their income on rent are more financially responsible and have a larger safety net in emergencies.

4. Landscape, Paint, and Clean!

The better your rental looks, the better your chance to lock in a top rate! Landscaping, painting, and cleaning are usually the quickest and cheapest steps an owner can take to bring in higher rents. Landscaping is the first thing people see when they drive by your property or arrive for a showing. In order to maximize your revenue, maintain the landscaping to create a strong and lasting impression. Same thing goes for painting and cleaning inside of your property. In Robert C. White & Company’s thousands of units of experience, a freshly painted and cleaned unit rents faster and for a higher rate.

Tax Magic: 1031 Exchanges Explained

Fri, 01 May 2020 16:25:29 GMT

1031 Exchanges

One of the most under-appreciated benefits of “buy and hold” real estate are those related to taxes.

Most real estate investors understand and “get” the main tax benefit of “buy and hold” real estate . . . the ability to write off depreciation, a non-cash expense. In certain situations investors are able to “lose money” on paper and get a tax loss they can apply to other gains, while actually having a positive cash gain from that investment property. In other words, they can make money on an investment and get a tax write off at the same time. Now that’s cool!

A less understood tax benefit is the ability to defer capital gains from a sale of investment property through a properly executed 1031 exchange. I am here to tell you that 1031 exchanges are great and have the potential to save you a lot of money that you would otherwise pay in taxes. But you need to have a high-level understanding of them so you can identify when an exchange would, or would not, make sense.

Author’s note . . . I am not a tax or legal professional. This is meant to be educational. You are not allowed to do a 1031 exchange on your own, so get professional help if you plan on executing one of these.

Now, let’s get into some details.

1031 Exchange: An Overview

Typically, when you sell an investment you have to pay taxes (as it relates to “buy and hold” real estate, both capital gains and depreciation recapture). However, the IRS has an exception (outlined in Section 1031 of the tax code, hence 1031 Exchange) that allows you to change your real estate position into a “like-kind” investment without paying taxes.

The high level idea is if you exchange one real estate investment for another within certain timelines, following certain rules, and by using independent people you are allowed to defer the capital gains until you do sell down the road.

To make it tangible, let’s imagine I own a single-family home rental in Middletown, CT that will sell for $250,000 in today’s market. It has appreciated well, but I am looking for better income, which I find with a 2 family home in Hamden, CT for $300,000. If structured correctly, I would be able to sell the single-family home and buy the 2 family home within 180 days and I would pay no capital gains. The cost basis (i.e., what I bought the investment for and how much I have depreciated) of the single-family home will be passed on to the 2 family home for tax purposes.

In theory, I can do this over and over again until I pass away . . . at which time there is another wonderful tax advantage of real estate . . . stepped up basis - but that is too much detail for this article. Just know that it is another reason “buy and hold” real estate is such a great investment!

Alright, that is the high level. 1031 Exchanges are a complicated topic, with lots of nuances. That’s why it is so important to get expert advisors involved. To make things simpler, I am going to outline “delayed exchanges”, where you sell a property and then buy another one days or months later. It is the most common, and frankly, it is less complicated. Let’s get into some more details.

What is "like-kind" property:

The IRS requires that the exchange must happen with “like-kind” assets. Fortunately, the IRS is actually pretty open in its definition of “like-kind” assets for investment or business real estate. You can sell a two-family rental home and buy commercial property. You can sell land and buy a vacation rental. You can sell 2 single-family home rentals and buy an industrial building. However, you cannot sell investment property and buy personal real estate (though there are some exceptions related to conversion to personal use) and you can’t sell other investments, say art, and buy real estate (or vice versa).

Another important thing to understand is that the IRS looks at the value of the real estate being exchanged, not the number of properties being exchanged. So, you could sell 4 two-families and exchange it by buying 1 commercial property or even sell 1 or 2 industrial buildings and exchange it by buying 40 single-family rentals. What matters is the value of the sale (and the mortgage amount, but more on that later).

As long as you are selling investment or business real estate and buying investment or business real estate, the assets are considered “like-kind”

Qualified Intermediary:

Under Section 1031, the IRS considers proceeds received from the sale of investment property to be taxable. For this reason you cannot take possession of the funds and need to use a Qualified Intermediary to receive the funds of the sale and make the payments to purchase the new investment property. The Qualified Intermediary can be a person or company, but you want to work with someone that is an expert in this arena. You also want to get them involved ideally before you list your property for sale, but definitely as soon as you can after you have a sale contract in hand.

Identification Period:

You have 45 days from the sale to identify up to 3 potential exchange properties. These are calendar days, not business days and if you miss the 45 day window you are out of luck and have busted your 1031 Exchange. The date is critically important. You have a few other options regarding identification to accommodate the fact that you may be trying to take a large property and turn it into several smaller properties and to give greater flexibility.

You can identify properties that total 200% of the sale price (i.e., if I sell a commercial building for $5 million, I can identify up to $10 million worth of other properties).
You can identify as many properties as you like as long as you end up buying at least 95% of the value of the identified properties.

Purchase period:

Now, there is another major date driven event that cannot be missed. You must buy the exchange property within 180 days of the sale. This works on calendar days as well and if you miss it by 1 day, you busted your 1031 Exchange. Some people make the mistake of thinking they have 180 days after they have identified the exchange. You do not. If you identified the properties on day 45, you have only 135 days left to get the exchange properties purchased.

Rule of thumb to make sure you pay no taxes:

Two important rules of thumb to make sure you pay no taxes as part of the 1031 Exchange:

Make sure the property(ies) you buy cost more than the property(ies) that you sold.
Make sure the mortgage on the property(ies) you buy is bigger than the mortgage on the property(ies) you sold.

What happens if the property you buy is worth less than the one you sold or if your mortgage on the new property is less than the one you sold? Well, the IRS considers that “boot” and you will get taxed on it. In essence you defer part of the capital gains, but not all of them.

It is not the end of the world, and there may be circumstances where you want or need to take some of the cash off the table, which would lead to partial taxes. However, if you want to have no taxes, remember, the new property(ies) should cost more and have bigger mortgages.

Final Thoughts:

So, you now know enough about 1031 exchanges to be dangerous . . . but as mentioned, do not do this alone. You have to use a 3rd party Qualified Intermediary, and you should always get your tax professional involved.

One last thing, the benefits of a 1031 exchange are great, but the exchange is not without cost or complication. Make sure you have calculated the taxes if you sold without an exchange and how much you would defer using an exchange. Depending on the numbers some people decide it is easier to pay the taxes now and buy the new property the old fashion way, but on their own timeline and without the extra hoops and expense.

Should Utilities Be Included in the Rent?

Wed, 29 Apr 2020 15:51:06 GMT

Should Utilities Be Included in Your Rent?

Probably not. However, there are some nuances that will affect your decision as a landlord. Utility expenditure varies greatly between tenants and spikes during different parts of the year, so if you want to get the most out of your income properties, tenants should be responsible for as many utilities as they can be!

The biggest sticking point here is whether or not you have separate electrical meters, oil tanks, and water heaters in your property. If you do, you’re in great shape! Each individual unit can use utilities at their preferred rate and take responsibility for paying the balance each month. In the state of Connecticut, if a property does not have separately metered utilities, then a landlord may not charge the utility expense back to the tenant. For example, if two units in a building share one electrical reading, the owner must include electricity with the rent.

PRO-TIP = There are instances, with some government funded programs like Section 8, where it can be more lucrative to include utilities with the rent because of how the organization calculates the value of payouts!

Whether you are forced to include utilities or simply choose to, you should also consider the impact it will have on your marketing. Couples in your area may be searching for a 2 bedroom unit under $1,000/month while yours is listed at $1,250 with utilities included. Many renters in this situation won’t consider that possibility though, so they never search above $1,200/month. In this instance they miss out on your unit altogether!

The biggest drawback to including utilities is that tenants are unlikely to think about cost or conservation knowing they are paid by the landlord. A new tenant may choose to keep the house at 80 degrees, especially at no cost to them. In fact, our property managers have told countless stories about walking into a unit in the dead of winter, only to find the heat cranked up with windows wide open!

There are a few more things to consider with regard to utilities being included. One, is that rate hikes from electric/oil/gas providers in your area could hit your pocket if utilities come with the rent. Second, a unit with a large number of occupants means higher expected use at greater cost to the landlord. And finally, there is the added responsibility of tracking and payment place on the landlord.

To sum everything up, including utilities means you can charge more in rent each month, but also adds extra workload and responsibility for the landlord. At the very least, owners should consider the unique qualities of their property, the market it’s in, and typical usage rates before coming to a decision on utilities.

Landlord vs Tenant Responsibilities, Who is Responsible?

Wed, 29 Apr 2020 15:39:59 GMT

There are a ton of responsibilities to tackle when it comes to renting a property. Utility costs, maintenance, lawn care, cleaning and more! These responsibilities are always split between a landlord and tenant. Let’s get one thing out of the way first though, landlords and tenants should be upfront about their expectations prior to signing a lease or paying a deposit! Clearly outline the roles and responsibilities of the landlord and tenant when marketing a unit and to be sure those roles and responsibilities are well defined in the lease document as well. Expectation setting means no surprises, and that makes everyone’s lives easier!

Typical Landlord Responsibilities

So... who is responsible for what exactly? We’ll start here with responsibilities that fall on the landlord. Firstly, property owners are required to provide a habitable living space for any tenants in their property. This includes maintaining a structurally sound building and keeping major systems fully operational (heat, water, electrical). If habitability is affected, owners have a responsibility to act quickly to remedy the conditions.

Landlords also have a responsibility to maintain a safe environment for their tenants. The property and common areas should be kept free of health and safety hazards at all times. Costly and timely legal issues can be avoided by keeping your buildings safe and secure.

Owners are also responsible for coordinating and completing repair and maintenance requests. The more serious the repair requirement, the more urgent the landlord should be in remedying the situation. Just like a car however, the owner is not responsible for repairing and maintaining every item. Changing light bulbs and regular cleaning are not part of owner responsibilities when it comes to maintenance of a rental unit.

Landlord’s also have a responsibility to follow all federal and state fair housing guidelines. They must understand fair housing codes and avoid discrimination of any kind. Owners can find relevant information on the topic at https://www.ctfairhousing.org/

The property owner is also expected to track and monitor the condition of the units. They can do so by performing regular unit walk throughs to track normal wear and tear. Owners should also maintain a maintenance checklist for future reference in case of a tenant dispute, as well as copies of the lease and other rental documents.

Typical Tenant Responsibilities

Maintain the condition of the rental property. Keep the unit clean and sanitary, remove trash, prevent mold and dirt buildup
Tenants should minimize damage to walls, floors, appliances, etc…Landlord’s are prepared to deal with normal wear and tear items, but not excessive damage.
Report any issues or maintenance requests to the landlord/property manager in a timely fashion
Tenants must use the premises for only lawful purposes
Tenants are liable for their pets. Renters should take responsibility for pets in their unit. (Cleaning, potty training, noise level)
Payment of monthly utilities for their unit

The Negotiables:

In most cases, the tenant is responsible for utility expenses. There are some instances however, where the owner must take on the utility cost. One example would be a building where two apartments have a shared electric meter. This wouldn’t allow the owner to differentiate monthly usage rates between tenants, so it would be unfair to put the burden on them to split the cost. Specific to the State of Connecticut, a landlord can only charge a tenant for utilities that are individually metered! So, if you were renting a single family home in CT, the tenants could be charged back for water use, whereas this is not possible in most multi-family buildings.
Maintaining the lawn and trimming plants/trees is another negotiable item. This responsibility is usually with the owner in multi-family units, but with the tenant renting single family homes.
Snow removal is another responsibility typically with the owner in multi-family units and the tenant in single family properties.

There is always room for negotiation, but generally speaking, this is the way responsibilities are broken up! One last word of advice for landlords and tenants alike... set your expectations early and remove the surprises. Your rental experience will be better for it no matter what side you’re on!

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