E-Renter News

Imagine showing vacant apartments or rental houses without leaving the comfort of your home or office. Two University of California Berkeley graduates have invented a device that allows you to do just that.

Making appointments to show rental properties can be inconvenient for both the prospective tenant, and the landlord or property manager. The hassle comes with owning rental property. Every landlord knows the frustration of making an appointment and waiting for a would-be tenant who never shows up. And many tenants don’t want to wait—they’d rather look at a rental now, while they’re out searching.

The co-founders of Rently.com created technology that automates the process. Property owners who pay the company $99 per rental receive access to exclusive QR stickers for their For Rent signs or links in their print or online ads, along with electronic lockboxes for their properties.

Here’s how it works: When a prospective tenant scans the QR sticker or chooses the link, they are taken to a site to create a user account, verified by their credit card. Once the account is established, they can receive an entry code that unlocks the lockbox. The access code can be used only once. The tenant can then view the rental property on his or her own.

In addition, Rently.com offers marketing support for each listing, and monitors each property’s visits seven days a week.

What do you think of this idea? Is it too risky? Does the capture of credit card information make it less of a risk? Would you use this service?

While going green is common rallying cry in homes and businesses across the country, it’s sometimes difficult for well-meaning rental property owners to cut the energy use in their buildings. Everyone agrees that using less energy is a good thing; but among city, state and federal government entities, and clean energy proponents, there hasn’t yet been a plan put in place to start making buildings more energy efficient.

Landlords in some metropolitan areas are required to reduce and report energy use. If you’re not one of them yet, don’t worry – you probably will be. Curtailing carbon use is a requirement coming to nearly every area. Commercial landlords in New York City and Washington, DC must already report their energy use to city agencies, which are collecting the data to use to formulate new energy policies. In many areas, if you want to sell a building, you must disclose the property’s energy costs to interested buyers.

Putting less strain on the nation’s aging electricity grids is one of the goals of wide scale measurement of building energy use. Once the data is in, agencies can work on plans to help landlords replace old heating systems, switch exterior lighting to more efficient fluorescent bulbs and encourage them to help tenants reduce energy use. The only problem then will be finding the funds to fix old buildings and make them more efficient. Green energy proponents say that reducing energy use can positively impact return on investment, and that government funds should be made available for the good of the nation.

Prices for condos and homes in popular vacation spots are falling – and investor interest is rising. If you’re already a real estate investor, does it make sense to buy a vacation home for yourself and rent it out when you’re not using it?

According to the National Association of Realtors annual survey of Investment and Vacation Home Buyers, the median price of a vacation home fell 11% last year, compared to 5% for primary residences. This alone can cause investors to take notice. But while near-rock-bottom prices may make scooping up a beach house, ski resort condo or lakeside cabin sound irresistible, in reality renting out a vacation home is different than a primary residence.

Here are some considerations to think about:

• Turnover: There are usually no long-term leases when renting a vacation home. Bookings will likely be for a weekend, a week or two weeks. You’ll have to deal with dozens of potential short term tenants, or “guests,” through the year.
• Management: In most cases, a vacation property is going to be at least a couple of hours from home. You’ll probably need to hire a property manager to maintain it, shovel snow or cut the grass, be sure it’s cleaned between rentals, and to manage the key exchange each time the unit is rented. If the property is close enough, you could do this yourself, but it could really cut into your free time.
• Risk: Are you ready to rent to total strangers? How will you screen the people who want to rent your vacation home? Establishing procedures like asking for a copy of a driver’s license can help, as can hiring a professional property management company. But most vacation home owners don’t run background checks on vacationers.

The NAR survey also shows that 34% of people who buy vacation homes intend to use the property as a primary residence one day. Weigh the potential risks and possible hassles of purchasing and renting out a vacation home. You may decide it’s worth it—especially if it pays for itself, and you have a place to live when you finally retire from being a landlord!

Boulder, Colorado is a college town known for outdoors enthusiasts, new-age practitioners and healthy lifestyles. It also has a lively rental market, and a landlord licensing program that began way back in 1973.

Boulder landlords are required to pay a registration fee of $70 to rent a property. Officials say that earlier this year, there were approximately 520 cases of non-licensed properties that required investigation. An outreach program targeted suspected violators with a letter asking for compliance. While 70% of respondents cooperated, the remaining 30% who didn’t respond and are illegally renting property will likely see $250 fines.

A newly appointed “rental licensing compliance specialist” has been assigned to track them down. Many landlords obtained the licenses without question. Some thought they were exempt because their tenants were relatives; others simply refused to obtain a license in time to avoid the $250 fee.

In addition to the fine, the compliance specialist may also issue administrative fees and civil penalties, as well. A $150 penalty for a first violation, $300 for the second and $1,000 for the third will likely make determined property owners take the city regulation seriously.

Boulder’s landlord fees cover baseline inspections, when the license is first issued, and renewal inspections every four years. Officers check for mechanical and electrical requirements and safety issues.

Rent laws in New York City keep tight reins on landlords. More than 2 million apartments are subjected to the laws, which limit how much a landlord can charge for rent and how much rent can increase year over year. New York has a perpetually low vacancy rate, due to a high population and limited space for new construction.

Tenants’ rights advocates say the situation creates a disadvantage for renters, who are “disposable” to landlords who know they can rent their properties easily to a long line of prospective tenants. Rent controls, they say, level the playing field and keep landlords from renting to only the wealthiest people in the city.

Further, locking out renters who teach in the city’s schools, drive its buses and work in its tourist attractions and restaurants would distort the economy and make the city non-functioning, rent regulation supporters say.

But landlords say the laws are hurting tenants by boosting rents at the low end of the scale. In the meantime, church groups and other tenant advocates are building tent cities with cardboard boxes fashioned into shelters and tents pitched beside them. They are dramatizing what they say will be a future with no rent controls.

Some say the laws don’t need to be eliminated, just changed to make it harder for landlords to harass tenants into moving once the rent reaches $2,000 per month—because that’s the threshold for removing an apartment from rent regulation.

Over the past ten years, some 300,000 apartments have left the regulated system, making it more difficult for lower- and middle-income New Yorkers to find rental housing.

What are your thoughts on New York City's rent controls? Should landlords be allowed to charge what the market will bear? Or do tenants need some form of protection?

Across the country, owners of vacant—and sometimes occupied—rental homes are facing huge losses, thanks to thieves. From stripping aluminum siding and copper wiring from buildings, to taking entire hot water tanks, air conditioners and steel beams, thieves are winning the battle against weary property owners who feel helpless to stop them.

Even if insurance covers landlords’ losses, the time and effort in collecting evidence and filing claims takes an additional toll. The problem is creeping into towns and cities in every state, and law enforcement officials say it’s not only a sign of tough economic times, but tied to drug use as well.

Now the problem has escalated to the point it is described as a “threat to the nation” by the FBI. Because copper is part of the country’s critical infrastructure, the estimated $1 billion a year in copper theft is especially dangerous.

Now there is an advocacy group to fight against copper theft. The Coalition Against Copper Theft says it’s a national security issue that must be stopped. Scrap yards, a spokesperson said, need to be watched more closely. It’s too easy for thieves to sell the items they’re ripping off of homes, power lines and even trains.

Criminals seem to be a step ahead of everyone else. Police departments can’t prove items are stolen unless they catch the thieves in the process. Tracking wire and pipe is nearly impossible. And salvage yards often look the other way.

In some states, lawmakers have reclassified and increased penalties for the illegal purchase of certain scrap metals. In Missouri, purchases are Class D felonies with maximum prison sentences of up to four years. The new laws also require that a buyer keep copies of every seller’s photo identification for two years. Failure to do so is a misdemeanor.

In the meantime, landlords are securing materials, locking buildings and installing security systems.

If you’re a landlord who’s been holding the line on rents during the economic downturn, you may not be able to do so much longer. Prices are starting to climb for food, gas and other necessities.

But if you raise rents, will you lose tenants? Maybe not. Demand for rental housing is rising, as we reported here yesterday. Fewer buyers qualify for mortgages because lending criteria is tightening up. Foreclosed homes are forcing former owners to rent again. And economic recovery is allowing more people to move out from friends and family units into their own rentals.

So, even If you do lose a tenant due to a rent increase, you might not have trouble filling the vacancy at the higher rent.

Do your homework and research your area to see how vacancies and average rents are looking. Then notify tenants in writing that the rent will be increasing. Here are a few tips:

• Check your rental agreement to see if it allows you to raise rent between lease renewals. Obviously, you need to follow the requirements of the lease. You may need to give 30 days notice before the lease renews.
• Consider giving yourself some room for negotiation. If you need to raise rent by $50, ask for $75 and allow the tenant to negotiate down to $50. Do keep your minimum in mind and stick to it.
• Don’t make exceptions for good tenants, or you could be accused of favoritism.
• Consider offering tenants an upgrade in exchange for the higher rent, such as upgraded cable for a month, a new dining room light fixture, or new window blinds. The rent increase should more than cover the cost in a month or two.

Only you can determine whether it’s worth it to raise the rent, lose a tenant, and go through the trouble of replacing him or her. Sometimes it will work out, and sometimes it won’t. That’s the rental property business!

Flint, Michigan was hit hard by the recession. And now thieves are making it worse for hundreds of landlords, by stealing from vacant and occupied rentals. One landlord said he’s had 32 out of 37 properties damaged, with no criminal charges filed against the thieves. He’s almost ready to get out of the rental property business. “I tried to be an upstanding citizen and a good landlord and keep the properties up. How many times can you get beat down?” he asked.

The items robbers are targeting might surprise you. Thieves are stealing aluminum siding right off the sides of rental houses, right in the middle of the day. They are also stripping copper wiring from vacant rentals.

Landlords met with the sheriff’s department to let them know they’ve had it with the lack of action. Now the sheriff’s department is stepping up enforcement. Undercover stings will target those who are ripping, stealing and buying the ill-gotten materials. While it might be difficult to catch thieves in the act, it’s easier to check up with those who purchase aluminum siding and copper wiring: recyclers.

Police are warning that recyclers who purchase metals without knowing the source could be held liable for buying stolen goods. Criminal charges can include felony counts for those who knowingly purchase stolen property.

Have you ever had a rental home damaged by thieves? Were your local law enforcement responsive? \

When dealing with problem tenants—particularly rowdy students who attend the University of Iowa—landlords in Iowa City have the support of an unusual city ordinance. But does it go too far? Some say it does, with consequences for both the students and the rental property owners.

The ordinance was passed in 2003; it requires landlords to evict tenants who have three criminal violations. And if they don’t, city landlords can have their rental permits revoked. Classified as “nuisance properties” are those rental properties whose occupants have been issued criminal complaints three times. These criminal violations can range from drug possession and disorderly conduct, to terrorism.

After two such violations, the property owners are required to meet with the tenant(s) and city code compliance personnel. The idea is that the two parties involved agree to take corrective action in order to prevent a further code violation.

If the tenants fail to comply with the agreement and receive another ticket, the landlord's rental permit can be suspended for up to six months. This can apply to an entire dwelling unit—an entire apartment building or complex.

One tenant’s actions can be enough to trigger such a suspension. Of course, the landlord has a line of defense: they can avoid suspension by evicting the tenants. Some UI Student Legal Services personnel are concerned that students who are uneducated about their rights are being unfairly punished, and that the automatic evictions do not consider individual circumstances.

Students plead guilty, sometimes if they haven’t even broken a law, according to one Student Legal Services attorney. They believe the ticket is equal to a parking ticket—but it’s actually a criminal violation. Unaware of their rights, students often pay the ticket without defending themselves.

Despite the ordinance, the number of disorderly house citations tripled from 2007 to 2010. They are typically not dismissed, and judges have no discretion in minimizing the fine. If the evidence is there, the defendant will be convicted.

Should the eviction of tenants be the landlord’s decision? Or is the Iowa City ordinance a way to prevent the negative impact on safety and quality of life in neighborhoods with high proportions of student rental housing?

If you plan on leasing rental property into the near future, having insight into the changing demographics of the United States population might be helpful.

• Which will be in demand, one-bedroom apartments or multi-bedroom single family residences?
• What accommodations will the aging population require?
• Which areas of the country will grow—and which will decline—in population?

Married couples with children will account for a smaller percentage of American households. Bigger groups include married couple with no kids, followed by single-person households. So it looks like one- or two-bedroom units might be in demand for some time to come.

82% of U.S. citizens reside in cities and suburbs. Obviously, the rental market in cities will be livelier than out in the middle of farm country.

The population is definitely aging, as the Baby Boomer generation reaches retirement. The number of people over 65 will double in the next 30 years. Will single-story rental units be more popular with the older crowd?

What about factors like wheelchair- and walker-accessible doorways, bathrooms and kitchens? Would you consider adding or converting rental properties to accommodate more people with disabilities?

Where will the booming retiree population want to live? (Hint: probably not in the snow belt states.) Investing in warmer climates might be the best way to go.

Understanding demographics is not just for Madison Avenue marketers. It’s a viable factor that rental property investors should consider when planning future purchases.

This is not investment advice. Please consult your investment advisor for specific recommendations on your situation.