Landlord Inspections: The Do’s and Don’ts of Apartment Inspections

Maybe you’re suspicious one of your tenants is breaking the lease’s pet policy. Maybe you just haven’t checked in with them for a while.

If so, you may ask yourself: can a landlord do random inspections? Well, the answer isn’t an easy yes or no.

As a landlord, you can drive by, walk by, or bicycle by your property anytime. But you cannot walk into the property unannounced. We’re here to walk you through the do’s and don’ts of landlord inspections.

Legal Reasons to Inspect an Apartment

Apartment inspections need to be performed for a variety of reasons. Let’s take a look at those situations in which you can legally enter and inspect an apartment.

Maintenance and Repairs

Your tenant might ask you to service or repair something. Typically, landlords are only permitted to enter the premises during “reasonable hours.” That varies from state-to-state.

Any time between 9 a.m. and 5 p.m. is usually considered reasonable. Those hours are within normal business operating hours.

However, when a repair is specifically requested by the tenant, you can enter and perform the necessary service at any hour that is mutually agreed upon.

In a scenario where the tenant has not requested maintenance or repair, but you still need to perform it, give them 24-48 (dependent on state and local law) hours’ notice of your arrival. Additionally, make sure to come at a time that falls within the scope of “reasonable hours.”

Decorations, Alterations, or Improvements

Can landlords do random inspections to address the aesthetic? As a landlord, you have the right to make aesthetic changes as you see fit. This is different from maintenance or repairs. That’s because it’s not something that you need to do to maintain the unit’s habitability.

For example, you might want to repaint the front porch or install new light fixtures. In these cases, stick to the “reasonable hours” rule. Make sure to give your tenant proper notice.

Showings

You have the right to show the unit to prospective tenants. Again, be sure to notify your tenants in advance. This gives them the opportunity to ensure that they’re out of the apartment during showings or give the unit a good once-over, if necessary.

Keep in mind, with millions of Americans working from home due to COVID-19, it may be difficult to schedule a showing during the workday. If that’s the case, you’ll need to work with your tenants to schedule a time that works for them without disturbing their work. You could also “show” prospective tenants your available units via 3D apartment tours.

Lease Violations

Though you may have done your due diligence, there’s always the chance that you may have a tenant that is egregiously committing lease violations. Whether you suspect there’s an illegal subletter on the premises or that your tenant has willfully ignored your no-pet policy, you have a right to check it out.

As it goes for all instances in which you may want to enter the unit, give notice. If you find that your tenant is committing lease violations, you may need to serve a notice to quit.

Move-in/Move-Out

It’s essential for landlords to conduct move-out inspections to assess the damage, if any, that the last tenant is responsible for. Your findings will dictate how much of a tenant’s security deposit you’ll refund back to them.

Upon move-in, inspections enable landlords to confirm the condition of their unit. Then, they can make any necessary repairs before their new tenant officially moves in.

Extenuating Circumstances

While the previous reasons to perform an apartment inspection were very clear, there are also extenuating circumstances in which an inspection can be legally performed. These include:

Court Orders: If you’ve obtained a legal order granting you permission to inspect one of your units, then you can legally perform the inspection. Typically, the order may stipulate a specific date and time that you can perform the inspection.

Tenant Abandonment: Keep in mind that the requirements to be considered “abandonment of a property” are different state by state. If a unit has been abandoned, you’ll need to remove any remaining possessions. Be sure to document the abandonment.

Tenant Violation of Health/Safety Codes: Not only does this put the tenant and others at risk, but it can also lead to significant damage to your property in the form of a pest infestation.

In Case of an Emergency: For example, a fire, gas leak, water leak, burst pipes, or an extreme weather event that may threaten the safety of your tenant gives you license to make necessary repairs as quickly as possible.

Do’s of Landlord Inspections:

Give Proper Notice of Any and All Inspections (24-48 hours)

Also keep in mind that, even after giving notice, you can only enter a tenant’s unit during “reasonable hours.” Typically, though this varies by state, a time between 9 a.m. and 5 p.m. is considered to be within the scope of “reasonable hours.”

It’s even better to give even earlier notice than the recommended time frame. That’s the case especially in cases of routine inspections that you’ve scheduled in advance.

There are real legal consequences for failing to give notice. Those include arrest, fines, and legal action being taken against you.

Avoid this by giving written notice, leaving a note on the door or in the mailbox, or sending notice via email. Those methods are sufficient and serve as proof that you adhered to the law.

Schedule Property Inspections a Few Times Throughout the Lease Term

There’s no magic number for this. It’ll depend on the length of the lease (we recommend no more than quarterly for a year lease).

What’s the rationale behind scheduled, incremental inspections throughout the duration of a lease? Well, it ensures that maintenance and safety standards are up to date without being excessive.

Remember: Purpose, Professionalism, and Tenant Privacy

If you must enter a tenant’s home to perform an inspection, consider purpose, professionalism, and tenant privacy. State your purpose upon your arrival, give proper notice as a professional courtesy, and respect your tenant’s privacy by ensuring that you don’t overstep.

Document All Routine Inspections in the Lease Agreement

If you have a policy that allows for inspections over a set interval of time, then you need to document that in the lease agreement.

It’s imperative to discuss these provisions when you’re face-to-face with the tenant at signing. This way, everyone knows what to expect ahead of time. It’s much better than having tenants, who haven’t read through the lease, be caught off guard by your routine inspections.

Be Smart and Reasonable

Just because the law is on your side, doesn’t mean you should completely disregard the importance of a good tenant-landlord relationship. If you’re continuously notifying your tenant that you’ll be stopping by, it’s likely to frustrate your tenant over time. If you’d like to increase your rate of renewed leases, limit your inspections.

Don’ts of Landlord Inspections

Breach a Tenant’s Right to Quiet Enjoyment

The right to quiet enjoyment is legally protected. For tenants, this means that they can peacefully enjoy their homes, bar entry from landlords, and that the landlord is responsible for the maintenance and upkeep of the property. Entering the apartment without permission or not giving notice would breach this right.

Show Up Unexpectedly

Outside of an emergency or extenuating circumstance, you need to give tenants proper notice. If your state has a statute that describes a specific notice period that you must give to tenants before entering their homes, then you must always adhere to it.

Remember that a tenant may refuse entry to a landlord that has not given appropriate notification. Additionally, avoid requesting inspections outside of reasonable hours: typically, 9-5.

Ignore State and Local Law

Laws regarding apartment inspections vary in different states, so it’s imperative to be up-to-date with your knowledge of current inspection law. For example, Alabama requires a two-day notice. Connecticut requires reasonable notice. New York has no statue on a state level.

Give a Vague Notice

When you are letting your tenant know you’ll be coming by, stipulate a date and time. Don’t leave the “when” up in the air. Be sure to state your purpose for entering.

Are you coming by for a showing? Are you repairing something? Or is it a regular inspection? Fill your tenant in on the details for your upcoming visit.

Final Thoughts

As a landlord, you’re ultimately responsible for the upkeep and condition of your property, even when you’re renting it out. Though you’ve gone through the process of thoroughly screening all tenants, there’s always a chance that your tenants may not keep their apartment in top-notch condition. That’s where landlord inspections come in.

Whether your tenants don’t report a leak which ends up causing extensive damage or you simply want to perform a routine check-in, you have a legal right to inspect your property.

However, you must comply with the law when you do. Typically, this means giving proper notice and not entering a unit without permission from your current tenants, except in emergency circumstances.

Can landlords do random inspections? The answer is yes if you follow the above advice and adhere to local laws, your lease, and best practices.

6 Tips for Setting Rents, Winston Rowe and Associates

If your rent is set too high, the property can sit on the market and you will miss out on monthly rental income.  And if the rent is set lower than the competition, simply put, you will leave money on the table.

Whether you own or manage one rental property or hundreds of rentals across the country, you need to be able to set fair market rents confidently.

As we know, rents vary greatly from market to market, but can even differ from one street to the next within a single neighborhood.  Obviously, numerous variables impact the rent you can charge for your rental unit, including location, type of building (duplex, apartment building, etc.), size/square feet, age of unit, number of beds/baths, and amenities (i.e. parking, AC, pool, roof deck, and so on.)

Don’t be fooled that any one rent comp, property manager, or local real estate agent can tell you the perfect fair market rent for your property.  We recommend that you tap into a handful of resources to help you set rents confidently.

1. Find some rent comps to give you a starting point

Check local apartment listings using the local newspaper, online apartment guides, or websites like Craigslist and Rentometer to get a feel for the “going rents.”  Rentometer can give you historical rent trends for the area and a good starting-point rent.  You can further refine the rent from there by using some of the suggestions listed below.

2. Stay up to date on the economic and business activity in the local market

Is it thriving? Are stores closing down?  Economic activity is one of the key drivers of rental housing demand and it can affect the rental market in unique ways. For example the current economy in Boston, Mass., is hot! Rental housing is in high demand, leading many renters to forgo amenities and perks in favor of securing a lease. This means that landlords can afford to make fewer concessions when negotiating.

3. Check occupancy rates for your area

Are the occupancy rates trending upward? Good! The stronger the desirability of a rental, or neighborhood, typically the higher the occupancy rate – and higher market rent. It’s a question of supply and demand.  Factors that can affect occupancy rates include local millennial population, employment trends, housing supply, and new construction growth, rent prices, and the location and  condition of the rental property.

4. Chat with a local real-estate professional

Talk with an industry professional about their take on the market or a specific neighborhood. Local experts (property managers, brokers, agents, appraisers, and lenders) are especially good at identifying the drivers of housing supply and demand unique to your market – jobs, local ordinances, building permits, zoning for a new apartment building, etc.

5. Use “rent per square foot”

Whenever possible use square footage as a benchmark for searching rent comps. This allows you to encapsulate into a single number all the subjective variables of rent, and provides you with a basis for comparison across different units, locations, amenities, and so forth.

6. Check your local apartment or rental-housing association

These are great resources for research. They may provide information about local rent levels – past, present, and future. This is especially important for real-estate investors and developers.

Making sure your property is renting at (or close to) fair market rent is as much of an art as it is a science.  However, with the 6 tips for setting rents along with good current and historical rental data and a thorough understanding of the local market and market conditions, you can set rents with confidence!

A Comprehensive Guide for Apartment Manager

Apartment Building Lending No Up Front Fees Winston Rowe and Associates

With growing sizes of building complexes, apartment management is becoming one of the most challenging jobs. As an apartment manager, you are not only responsible for maintaining the building but the owner and tenants as well.

The main task of an apartment manager is to improve the client-tenant living experience. They need to reduce costs and increase profit whenever possible.

Many property managers often face many challenges when trying to manage rental property. It’s essential that the management of a property run smoothly just like any other business.

If you are an apartment manager or owner struggling to do your job, these quick tips will guide you through managing an apartment efficiently. So let’s begin then.

Important Points to Consider for Apartment Manager

1. Following the Housing Laws and Policies

2. Securing Your Property

3. Making the Apartment Desirable

4. Selecting the Right Tenant

5. Maintaining and Upkeeping the Society

6. Resolving Resident Complaints Immediately

Important Points to Consider for Apartment Manager

1. Following the Housing Laws and Policies

Some specific laws and regulations govern the professionals responsible for managing properties. Every state has its own set of rules and regulations which needs to be strictly followed.

In recent years, there have been reported cases of property managers where their actions have resulted in the unauthorized practice of law. That’s why apartment managers should work closely with legal counsel. It will ensure that they don’t unintentionally violate the law.

Get in touch with the lawyers who are familiar with the housing field. They will guide you through relevant policies. Let them know about your intentions and what you plan to do with the property.

Furthermore, take advice on tax liabilities and potential credits related to renting properties.

We would suggest that meet two to three lawyers in the beginning. Talk to them about your renting plans and then,  decide with whom you can work for a long time.

Hiring a good lawyer will ensure that you always stay on the right side of the law.

2. Securing Your Property

Owning a residential rental property is a wise investment. But at the same time, it can be quite risky especially if you are new to this field. Without the right building insurance, you can face severe financial loss if something goes wrong.

The primary concern for any apartment manager or owner is the protection of the property from catastrophic events. Your apartment complex insurance should protect you against losses, damages, liability claims, and other issues.

Property insurance can seem complicated at first. But you can always take the help of your lawyer and insurance agent to guide you through.

Also, you should know that the insurance coverage and its cost vary. It depends on factors like the building’s location, type of construction, and more.

Some of the risks that apartment building managers/owners have to deal with:

    Liability for tenant, employee, and visitor injuries

    Theft or vandalism

    Advertising liability

    Fire, storms, and other catastrophic damage

    Invading the right to privacy

    Loss of rental income

    Discrimination lawsuit filed by disgruntled tenants

    Any allegations of fraud or misconduct by tenants

You can tailor the insurance policies to one’s need to address the risks as mentioned above.

3. Making the Apartment Desirable

You can’t ignore the fact that for each day your property stays vacant, you lose potential rental income. If you want to attract quality tenants, make your apartment as desirable as possible.

How do you do that? A few simple fixes to help you make your property desirable to prospective tenants.

    The first thing any tenant would look at is the exterior paint. If it is not at par, the tenant may not even want to come inside. A few ways how you can fix it:

        Add some quality landscaping to increase the property’s curb appeal

        Remove chipped paint and get a new coat of exterior paint

        Repair broken banisters and replace torn window screens

        Keep the compound clean. Remove trash, weeds, and debris

        Make sure the lawn and shrubbery are well-manicured

    If you want to charge a hefty amount in monthly rent, then, of course, you would have to go the extra mile. Provide luxuries that many tenants would be gladly willing to pay for. For instance, you can consider adding an in-house dryer, energy-efficient appliances and more.

These small tricks will help bring in the quality of applicants.

4. Selecting the Right Tenant

The next step in the apartment management process is selecting the right tenant.

Renting out apartments can be stress-free only if you have the right tenants. For that, you would need to advertise the vacancy to let people know about your rental space.

I. Advertise the Empty Space

Even in places with high housing demands, advertise your space stating all the facts and your requirements. This will help draw the right kind of applicants to your rental house.

The ad should contain information such as your contact number, details about your apartment, and what up are looking for. Some of the places where you can advertise it are:

    Post it on newspaper

    Display it on Internet classified sites

    Connect with a real estate broker

II. Screen Tenants

Of course, you are not allowed to discriminate your tenants based on caste, creed, race, sex, etc.

However, you should screen tenants before renting your apartment to anyone. Make sure that they are financially sound to pay your rent and do not have any criminal background.

Otherwise, unsystematic screening and tenant selection often result in some significant headaches. You might end up with a tenant who pays the rent late or not at all and poorly maintained the place.

Your screening criteria should be the same for all. It should include:

    Run a background check on each applicant to ensure that they won’t conduct any illegal activities in your apartment

    Obtain a credit report to see if they can afford your rent and will be able to pay your rent on time

    Ask for references from previous landlords or other personal references if any

III. Get it in Writing

Once you have chosen your tenant, make sure that you have a lease agreement in place. It should contain all the terms and conditions agreed by both the parties.

Having it in writing will protect both you and your tenants in case of any conflict in the future. The rental agreement helps create good relation by specifying things. It includes clauses like how and when you handle tenant complaints and repair problems, notice period if the tenant decides to leave, and more.

The lease agreement should contain the following information:

    The names and signatures of the tenant(s) and landlord

    The starting and ending dates that the property will be rented

    Rent costs and due dates

    Policies on security deposits and lease termination

    The tenant’s responsibility to maintain the unit and pay for damage caused by any neglect

    Strategy and procedure for dealing with tenant’s complaints and repair request

    Mention the restrictions if any on tenant alterations on their apartment without your permission

    Information on any environmental hazards present at the property

    Other optional policies as required

You can always find lease templates online or even talk to your lawyer about what information to put in one.

Furthermore, a written agreement helps in running the property smoothly and enhance resale value. Make sure that the tenants are aware of all the clauses included before signing the lease.

IV. Ask For Security Deposits

Security deposits are used to cover the expenses in the event of any damages or other faults with the apartments when a tenant moves out. To avoid any dispute over the security deposit when the tenant moves out, it’s better to inspect and document the condition of the unit before they move in.

Specific regulations are governing the policies regarding security deposits. With the help of a lawyer, establish a system of setting, collecting, holding, and returning security deposits.

Also, check with your state’s Landlord Tenant Act to know how long before you can return the deposit and/or a settlement statement.

5. Maintaining and Upkeeping the Society

At times it may become difficult for the apartment manager to choose between areas which need more focus than others. But thanks to the technological advancement, the apartment management software that comes to our rescue.

Using society software, you can streamline all operations and handle it from a single place. Following these five quick tips will help in a better apartment management system:

I. Automate Society Billing & Accounting

Financial issues are always a serious matter. When the apartment size keeps getting bigger, maintaining accounts can get too time-consuming and challenging at times.

The process of accounting and bookkeeping, penalty calculation, and income and expense tracking should be streamlined for smooth functioning. The best way to do that is to employ a society management software that automates your billing and collection efforts.

Some of the essential modules of tenant management include document depository, penalty calculation, maintenance charge payment, payment gateway, request for quotation, and more. It integrates with the current system in place without disrupting the whole operation.

II. Communicate With Your Tenants Effectively

As an apartment manager, it’s essential that you maintain a healthy relationship with all your tenants. For that, you need to find an effective way of communication.

The smart move would be to incorporate an apartment management software that offers communication tools. These tools can post notices and reach out to everyone. Furthermore, it assists in other activities like securely sharing pictures from community events, broadcasting essential messages, and maintaining functions calendar.

You can also create and publish articles on waste management guidelines, festival celebration forums, and more. It will help you create one active community with the ease of the housing software.

III. Manage Apartment Facilities and Staff Smartly

Again, you will often find complaints about how the apartment facilities are not well maintained.

You can save yourself some time by automating all your task such as asset tracking, inventory management, maintenance staff, and more. With the help of society management software, you can save yourself the pain of manually overlooking every activity.

Moreover, the software will also empower your tenants to book an apartment facility online. You can keep records of visitors for security purpose. These are a few of the many benefits a useful apartment management software has to offer.

Provide a superior experience to residents by managing all apartment facilities smartly.

IV. Skillfully Manage Society Data

One of the many benefits of using society maintenance software is that you can easily centralize all your data in one place.

You need to maintain a directory of residents, the number of flats in the apartments and more, to systematically reach out to them. Using maintenance software will save you a lot of time and help effectively manage the condo.

6. Resolving Resident Complaints Immediately

Resident complaints will always be an issue for apartment managers. It is therefore essential to have a system in place that will help resolve their problems immediately.

Having a central tracking of resident complaints or suggestions can be a good idea for efficient management. That’s why the whole process of filing complaints and the manager resolving the issue needs to be automated.

To immediately attend to the tenant’s problem, you can do the following:

    Use software that will help you track the complaints at various stages. It should also send alerts in case of unresolved complaints

    Give tenants a number where they can reach the management department 24/7, to handle any emergencies

    Always have a few handymen on standby who can repair your apartments when need be

It will help you manage the apartment much better and increase resident satisfaction. Thus, it will enhance their faith in the management committee.

Wrapping it up

Apartment management may seem like a daunting task at first. Especially when there are tenants who try to create menace in society.

Sometime you would also need to take legal actions when necessary. Some tenants do not pay rent on time or conduct illegal activities on the premises. Sometimes, they even cause damage to the property or violate the lease agreement. In such cases, talk with your lawyer and proceed in the right way.

Or you can take the help of a mediator to work with you and your tenant to reach out a settlement on the issue. Either way, make sure that other residents in society do not face any inconvenience.

Calculating A Commercial Lease Rent Per Square Foot

Calculating A Commercial Lease Rent Per Square Foot

Typically, commercial space is rented by the square foot, and for this reason, the measurement of commercial space is very important.

A commercial building has an overall size, called the gross building area (GBA).

The GBA represents a building’s total floor area, as measured from the outer surface of exterior walls and windows, and includes elevator shafts, utility rooms and basement space.

The percentage of the building that cannot be rented is called the loss percentage.

Typically, the owner takes a portion of that loss and tacks it onto the usable space to make the net rentable area (NRA).

Usable square footage, (USF) is the actual space contained within a tenant’s or all of the tenant’s premises, tenants are able to occupy and use most of that space.

Rentable square footage (RSF) is the number of square feet on which the tenant’s rent is based.

Ultimately, the RSF is whatever number the landlord and the tenant agree on for purposes of their lease.

Definitions of Square Foot Calculations:

Gross Building Area = Total area of all floors, including basement

Usable Square Footage = Actual space occupied by a tenant; for an entire building. Gross Building Area less Common Area

Rentable Square Feet = Defined by lease, but often the USF + an allocated portion of the Common Area

Loss Ratio = Common Area  /  Gross Building Area

Formulas for Square Foot Calculations:

Price per Square Foot = Price  /  Gross Building Area or Net Rentable Area

Income per Square Foot = Gross Scheduled Income  /  Gross Building Area or Net Rentable Area

Expenses per Square Foot = Operating Expenses  /  Gross Building Area or Net Rentable Area

To calculate the Gross Scheduled Income:

Gross Scheduled Income (annual) = Total rent payable for that year under existing contracts for occupied space + Total potential rent at market rates for vacant space.

When negotiating the rent for your commercial lease, you want to translate the dollars per square foot into the actual dollar amounts to head off future measurement disputes.

Winston Rowe & Associates prepared this knowledge base article.

They are a commercial real estate advisory and due diligence firm that specializes in financing of commercial real estate transactions.

They can be contacted at 248-246-2243 or visit them online at http://www.winstonrowe.com