Wednesday, 13 December 2017

Pros and Cons of Rental Properties in a College Area

College towns offer a unique demographic for property owners and investors. There are some solid reasons to buy an investment property in a college town, as well as some disadvantages to consider.  When thinking about a college area, you can envision a bustling community of young adults. Many students who recently moved from home are looking to rent apartments or houses.

What are the pros of owning and renting a property in a college area?

There are many advantages to owning an investment property near a university or college.  These include:

1. A steady demand.
            College towns have a predictable rhythm when it comes to housing. There’s a steady demand and a large potential tenant market for rentals near the college. There’s a regular influx of students each year, and landlords can depend on the regular demand. Apartments and houses within walking distance to the college or university have especially high demand.
2. A stable rental price.
            Due to the steady demand, landlords have an improved ability to count on a stable rent value. Alternatively, apartments or houses in other rental markets are subject to fluctuations in the economy and supply variations. Additionally, as off-campus housing is often times paid for by a parent, they are better able to afford a higher rent amount.

            As tenants often have the support of their parents as co-signers, or helping assist with rent payment, landlords find there is a greater ability to use technological solutions to save the landlords time. For example, landlord software such as Schedule My Rent enables tenants to pay their rent electronically. Parents or tenants are able to pay automatically, without the hassle of mailing a paper check. Schedule My Rent provides tenants/parents with email confirmation of payments made. With student renters, there’s an increased adoption of technology, which will save landlords time. Schedule My Rent easily splits rent payments between roommates as well. 

3. Lower vacancies.
            With consistent demand, landlords experience fewer vacancies in a college or university area. There’s always another college student looking to rent. This can increase profitability, and reduce time involved in the rental process.  The vacancies are also predictable. Landlords can expect turnover at the end of the school year, and can plan this into their business rhythm.

4. Time.
            The setting around a college or university has many appealing elements. Landlords find they spend less time marketing the properties as they sell themselves. University and college towns have many benefits, such as proximity to college sporting events, art performances, and restaurants or nightlife. Many find college or university areas have their own energy, which draws prospective tenants in.

Now that you’re familiar with some of the pros of investing in a college town, what are the cons? There are a few cons, some of which you might expect based on your own college experience….

1. Increased Wear and Tear.
            With younger renters, and those that are renting for the first time, you can anticipate some increased wear and tear on your property. Some college students aren’t known for their cleanliness and organization, especially when living with friends. There can be increased clutter, which may or may not cause additional wear on carpet, walls, etc. Beyond messiness, college students may cause damage to your property. Excessive alcohol consumption, lack of maturity, or reliance on a parent to pay any bills associated with damages may impact the mindset of college students renting your property. Ensure you collect a security deposit to cover any expenses associated with college renters. Understand your state laws regarding deposits, and plan with this in mind, ensuring you don’t overburden potential tenants.

2. Seasonal Vacancies.
            Though there is high demand for rental units near a college or university, landlords can anticipate vacancies at the end of each school year. That being said, many students will renew leases and find comfort and stability in staying put. Though there may be increased vacancies, most landlords note that it is easy to find new tenants for university properties. There’s always demand.

3.  Demanding Tenants.
            As most college students are new to renting properties independently, they may be more likely to contact their landlord with questions, or requests for help. With seasoned renters, they tend to solve minor challenges themselves, such as light bulb replacements, or batteries for thermostats. Where college students may be less familiar with simple fixes to easy problems.

The pros of investing in properties in a college town can be substantial and are something to consider.  Though there are cons, many landlords find the pros outnumber the cons. With landlord software such as Schedule My Rent, landlords are able to collect rent online and automate many rental tasks so landlords can focus time on increasing the value of their investments.

Tuesday, 5 December 2017

Getting Your Security Deposit Back

When moving into a new apartment, there are several move-in related activities to think about. For example, it’s expected that you provide your first month’s rent and a security deposit upon move in. Your lease terms will provide you with details on your security deposit, but by and large security deposits are refundable based on the condition of the apartment when you move-out. Typical lease terms will indicate that the security deposit will be used for damages that go beyond normal wear and tear. But as you can see, there is a lot of room for interpretation with this type of general language. How can you get your security deposit back? We have a few simple steps that will increase the likelihood that you’ll see green upon move out.

When you move in:
#1 Video! Take a video the condition of the apartment.
By taking a video of the apartment upon move-in, you’ll have a record of the current condition of the apartment. Ensure you capture all rooms, and any specific areas of the apartment where the condition isn’t optimal. For example, if there is a stain on the carpet, or a mark on the flooring. Other examples might include a ding in a door, or a mark on a wall. By capturing the move-in condition, you’ll be able to remind your landlord should they attempt to charge you for these less than optimal conditions upon move out.

#2 Walk-through
Prior to moving your personal items into the apartment, ask your landlord to walk through the apartment with you. Ask them to take photos of the property, and to provide you with details on what they expect the condition of the apartment to be upon move out.  Many landlords will provide new tenants with a move-in inventory or checklist, where you are able to note the condition of the property when moving in. If your landlord is completing the checklist, ensure you are there, and have influence on how the checklist is completed.

If you find there are items that are in a state of disrepair, ask your landlord to fix them as soon as possible. Provide your landlord with a written list of items that may need repair, as most landlords are likely to act quickly on these items when you first move in.

The above tips help ensure an accurate account of the apartment when you move-in. To best ensure you get as much as your deposit returned as possible, there are also move-out steps – beyond leaving the apartment clean.

Moving Out

#1 Be out on time.
When giving your notice to vacate your apartment, ensure you are familiar with your lease terms. Most agreements indicate that written notice is required by the last day of the month prior. As you will continue to remain in the apartment through the last month, your rent payment for that last month will still be due. Landlord software, such as Schedule My Rent, enables tenants to pay rent online each month – without the hassle of paper checks and postal processing times.

Why does vacating the apartment on-time help you get your deposit back? Well, your landlord will charge you for any time you remain in the apartment, beyond your move out date. Some leases also charge a premium or fee for late departures.
By moving out on time, your landlord is able to immediately begin any updates or repairs as well.

#2 Move-out walk-through.
Just as you were part of the move-in process, you’ll want to ensure you are present for the move-out walk-through. Once a tenant moves out, the landlord will assess the state of the apartment, look for any damages, and any charges associated with cleaning the apartment. By physically being there for the walk-through, the landlord can share any possible actions you can take to improve the current state of the apartment to potentially get more of your deposit back. For example, if you mounted a large TV onto a wall in your apartment, leaving sizeable holes in the wall, the landlord may allow you to repair the wall and apply touch up paint. This may save the incremental cost that might be associated with the landlord hiring a painter to do the work.

#3 Follow your landlord’s cleaning checklist.

Many landlords provide specific instructions related to cleaning the apartment at move-out time. Follow these instructions to ensure your deposit is returned. If the list of items is important to your landlord, it will impact your deposit.

Some landlords provide very specific move-out cleaning expectations, which help provide clarity on expectations. However, ensure the expectations are reasonable. One of our tenants expressed a situation where the landlord expected quite a list of move-out cleaning activities, beyond what might be expected from another landlord. It’s important to understand your landlord’s interpretation of normal wear and tear, as well as cleaning expectations. Speak with them if you find the expectations aren’t in alignment and determine how to adjust, and document the expectations.

#4 Provide your forwarding address.
While it would be great to receive your security deposit during the move-out walk-through, most state laws allow the landlord between 15-45 days to return the deposit. Check your state laws for specifics. As landlords typically do not return the deposit in person, provide your landlord with your new address, and change it with the USPS to ensure the deposit will make it to your new address.

What else influences the return of your deposit?
#1 Unpaid rent.

Check your lease terms to determine how your landlord might apply your security deposit to any unpaid rent. Many leases indicate that the security deposit can be used to cover any unpaid amounts due to the landlord, including unpaid rent, late fees or bills due. Prior to moving out, ensure you are up-to-date on any amounts due to your landlord. If your landlord is using landlord software to collect rent online, such as Schedule My Rent, having visibility to the status of your payments is easy. With Schedule My Rent, tenants can see automatically any rent due, late fees due, or other payments the landlord is expecting you to pay. Schedule My Rent will also keep you updated, by providing email reminders and receipts for any payments you’ve made.

#2 Cleaning.
If your landlord finds it’s necessary to hire cleaning professionals after you’ve vacated the apartment, you’ll likely be charged for this. By ensuring you’ve left the apartment in move-in ready condition, you’ll receive more of your security deposit back.

#3 Normal Wear and Tear.
While your landlord cannot charge you for normal wear and tear on the apartment, they can charge you for anything that goes above and beyond normal wear and tear. Clarify this with your landlord upon move out. An example might be if you’ve painted a wall a bright color, or if you’ve stained the carpeting.

A few key actions on your part can help you receive more of your security deposit when you move out. By talking with your landlord, and understanding expectations, much of the uncertainty can be avoided. In addition, by having a full picture of your rent payment status, through landlord software such as Schedule My Rent, you can ensure you are paid up, avoiding any late fees that might be deducted from your deposit.

Pros and Cons of Rental Properties in a College Area

College towns offer a unique demographic for property owners and investors. There are some solid reasons to buy an investment prop...