Do-It-Yourself Landlord's Blog - Improving & rehabs

Germans Behaving Badly

nospam@example.com (Craig) — Fri, 16 Feb 2007 19:57:00 -0600

Landlords misbehave in other countries too!

Hello Germany.

Ask The Relic is suffering through some obnoxious repair work being done to the kitchen of the place he/she (“Relic�? doesn’t exactly hint at gender) is currently dwelling with roommates in Germany.

No Tenant will respond favorably to having a kitchen renovation crew hammering and sawing about before 9am. That’s just unnecessary. Well, it might be necessary in Germany, and I’ve heard horror stories about dealing with craftspeople in Manhattan, but in the places where I collect rent it isn’t that far a stretch to schedule in-house work on a currently inhabited unit for mid-day.

Large-scale renovations are another story altogether, but Relic appears to be describing your basic “handy man�? type of work. Perhaps some aesthetic touches here and there. Nothing too involved.

At least I know what I’d be called in Germany now. Hausmeister is pretty sweet sounding if you ask me. “Landlord�? is cool and all, but it has some slightly negative connotations. Perhaps a nod toward a more cruel and medieval relationship between a Landlord and their Tenants. Like I have them tilling fields all day or something.

Now Hausmeister on the other hand, makes it sound like I am an actual professional of some sort! A MASTER if you will!

Yes, I realize that the normal translation of Hausemeister is the comparably less sexy “janitor�?, but whatever. I’m talking PERCEPTION here. Namely, my own.

Besides, being a master of the broad and necessary janitorial crafts industry can’t be all bad, even if it is a bit bad sounding.

[my sincere apologies to any potentially offended practicers of the janitorial arts out there, much respect due]

Canadians Behaving Badly

nospam@example.com (Craig) — Wed, 14 Feb 2007 19:54:04 -0600

Landlords misbehave in other countries too!

Hello Canada.

Wow. Superfink is extremely upset about the current behavior of her Canadian Landlord. He’s showing her crib about to new prospective renters, even though he pushed to have her and her roommate leave so he could renovate. And he’s apparently a fan of the no-tell unit showing! He just shows up with a crew of potential renters, oh, whenever!

Actually, I (in a round-about sort of way) understand the Landlord’s desire to get some renovating done, and the need to get the current Tenants out before it begins. Two reasons:

1. The renovation project I’m looking at will require some serious effort, and will likely demand the repeated cutting off of electricity and water. Some issues, such as a bathroom re-tile, will take a couple of days to complete. There’s only one place to bathe in the unit. So how’s a Landlord supposed to get that accomplished without a severe hindrance to the current Tenant? Sure, there are ways. But those ways usually get trumped by the second issue.

2. It’s difficult to upsell a unit that’s currently inhabited, even if you do extensive remodeling/renovating. Fact is, they rented X place for X dollars a month. You deciding to take the interior and appliances to X+100 will likely not translate to X+100 dollars in new rent within the mind of the Tenant. And why should it? Seriously. Contracts simply don’t work that way, and for good reason. Long story short: it’s difficult to convince a current Tenant that a newer looking sink and a dishwasher should fetch an additional $50 in rent per month.

But a new Tenant might not mind!

However, I suspect that Superfink’s Landlord was trying to lever them out before their actual Lease was up. Which is indicative of a rather low moral character, and sorta brings us all down in the process. Even in calm realm of Canada.

Long Term Tenants Are Usually Considered A Blessing

nospam@example.com (Craig) — Tue, 19 Dec 2006 16:47:13 -0600

Anesia Springborn over at The Landlord Blog has a great write-up on the loss of a long term Tenant (8 years!) who pretty much destroyed the place. It will need an ENTIRE remodel as soon as this Tenant vacates the premises. And of course, they were a month-to-month renter, so 30 days is all she had in order to inspect for, estimate, and conclude what will likely be a complete interior rehab project.

I cannot put enough stress on the need to do periodic inspections of your properties. No need to be overbearing, but a twice-yearly walk-through based on any circumstance available, or simply stated in the lease (unless it violates state law, which I can't imagine that being the case, but one never knows), can do wonders to avoid rehab disasters like these.

This is especially germane to one of my properties because I have a 10+ tenant on a month-to-month who has had some interesting issues during my ownership of the unit. Fortunately those issues afforded me the opportunity to check up on the unit itself. I simply did some cursory peaks at the rooms, while the plumber fixed the toilet or what-have-you, as the Tenant stood watch. No big deal. But it gave me a good basis for figuring out what exactly I’m going to need to save up for once the Tenant chooses to move on.

Most of the issues are the same as they were when I purchased the place, but have understandably deteriorated since then. Bathroom issues, kitchen horrors, ceiling problems, and all sorts of creative landscaping corrections all need to be addressed. Little by little, I am fixing what the Tenant allows, but only because I am able to get in there periodically and check the environment for future hazards that I can head off early (such as the leaky gas stove I replaced a few months back).

Planning ahead, I started a small fund, and have been adding to it ever since I purchased the place, expecting that rehab to hit me like a ton of bricks at any given moment. The lost rent during the rehab process, whenever it occurs? Well, I’m just hoping it won’t take too long. Whatever it is, it’ll just be sunk.

Anti-Gentrification Measures a Potential Boon for Landlords

nospam@example.com (Craig) — Thu, 7 Dec 2006 00:09:33 -0600

Buying in downtrodden areas, with the intent to renovate and resell has always been the trail marked by flippers. And in most cases, it’s probably best that it stays that way. Long term rental investors and multi-dwelling managers usually get hammered in these areas if they march in, build or repair, and then see the property taxes skyrocket at a speed that far outpaces that of rising rental rates.

They get cash squeezed.

The Crossland Team blog brings up this point in a recent post. The area in question is in Austin, and I’m very familiar with it. I almost purchased property in its center. So I believe I understand all the pieces in play. It's a large section of central Austin that is mere minutes (if not walking distance) to downtown. From an outsider’s point of view, there’s no reason why it took so long to be developed considering how far the city has been built up on all other sides of downtown. But from an insider’s pov, there has ALWAYS been a stigma against that side of the city. “The other side of the tracks,�? as it were.

Now, after a few brave investors headed the wave several years ago, investors took notice, started doing their homework, and they want to buy up lots of property fast, for quick high-end development. The frenzied dealing and bidding put upward pressure on property values, and those who have lived there for generations are now taking arms to battle the onslaught of “evil�? gentrification.
Continue reading "Anti-Gentrification Measures a Potential Boon for Landlords"

Don't Be That Landlord vol. III

nospam@example.com (Craig) — Mon, 27 Nov 2006 23:49:23 -0600

The main point of being a Landlord is to profit from sound, practical investment. This is understandable fact. It is understandable because it is the capitalist backbone of our entire system of freemarket ownership for things with speculative rates of appreciation. Namely: real estate. But there are other important, and arguably more socially responsible facets of being the proprietor of where other people sleep. Where they raise their children. Where they celebrate holidays. Where they experience life.

In that context, there are other responsibilities that need to be lived up to by Landlords. And some appear too cold-hearted to understand that. This is most unfortunate.

It’s yet another installment of “Don’t Be That Landlord�?.

Apparently, and this should really come as no surprise to anyone, tenants do not approve of unsolicited sexual advances. Who would have known! Seems to me that a pool of people who you depend on for money would be a PRIME set of folks to risk royally PISSING off by way of creepy requests for sexual favors!

Some people simply shouldn’t be in a position of authority. Spiffle’s Landlord is amongst that group of people.

And then there’s the oh-so-typical issue of mold in the unit. For the love of pete, this should not be a problem in modern times. Leaks are more than a mold problem for a Landlord. Leaks ruin foundations, destroy ceilings, wear away at expensive bathroom tiling, stain or warp valuable flooring, and cause endless damage to the sticks that build up a unit. But the mold is what will likely cause a Tenant to mount a legal offensive. It is also what will cause a potential Tenant to pass, or a current Tenant (who pays on time and causes no other problems) to vacate. Make routine checks, and reassure your Tenants that it is in their benefit to report leaks to you as soon as they notice them.

Because really, it’s in your benefit too.

Getting Wired?

nospam@example.com (Craig) — Sun, 12 Nov 2006 23:37:04 -0600

One of the tenants in a duplex was wondering about the future offering/bundling of cable/internet into his lease. The basic notion was that he’d pay a premium if these things were already installed and ready to go immediately upon move-in.

You see, he just moved in fairly recently, and had to have these services brought up to snuff by his lonesome. And as we all know, getting these services up and going can be a thorough pain in the time-consuming ass. It took almost a month for everything to be properly wired and operational. Plus he had to take time off from work to supervise the process.

Plus he has yet another monthly bill to stamp or pay online, and the hassle is apparently beyond reproach.

So I got to thinking about this. After all, I’m always on the lookout for additional revenue streams associated with my property. Why not handle all the difficulty associated with these services and simply charge a premium for it? Offer it as an additional service of the lease?

Well, after some picking around the interweb, I’m not quite as excited about the idea.

To begin, there’s the equipment involved. Routers, modems, signal amplifiers, hubs, and a myriad of wires or connectors. These will all have to be serviced/inspected/replaced by the Landlord. An additional appliance, in effect. More warranties and extensive hassle to keep up with.

So I figured, well, to simplify that nonsense, just go wifi and cut the appliance cost in at least half, along with centralizing the equipment to one location for easier service. Having less equipment with the same service makes for better economies of scale.

But then I remembered how dependable my own wireless network is. Or how undependable it is, rather. And that there are an almost infinite number of reasons why a wireless network may or may not be working. Which brought me to coffee shops who offer “free wireless access�? but don’t guarantee anything. Sow when the wire goes down, the wireless hub goes on the fritz, or the user’s laptop is simply janky, the coffee shop owner won’t get an immediate demand for repair.

Because it’s free.

And that’s the only way I believe I could get away with offering/bundling internet access on my properties: essentially, I’d be giving it away but hiding the cost in something else. That way, I wouldn’t be getting calls every two hours because the stupid wireless hub is acting up. Again.

Now if there was just some way to get around the potential legal ramifications…

Radon Gas: An Invisible Threat to Your Real-Estate Business

nospam@example.com (Eryn) — Wed, 8 Nov 2006 07:30:00 -0600

Radon is a colorless, odorless gas that occurs naturally in the earth from the decay of radioactive uranium in the soil. However, radon exposure in a domestic setting is actually a dangerous threat to your health and your real-estate business.

What are the risks?

Radon gas has been found to be an extremely toxic carcinogen. Studies on the effects of radon gas on the human community are considered conclusive since they use human test subjects instead of animals. A definitive link has been found between radon exposure and lung cancer in humans. Smokers are at a higher risk for developing lung cancer due to radon exposure than nonsmokers. According to the latest EPA studies, radon accounts for approximately 21,000 lung cancer deaths in the United States each year.

Where is radon found?

Radon gas is found naturally in the soil and in groundwater. Unfortunately, it can seep up through the earth and leak into your home or property. The construction of contemporary houses to be relatively airtight for air conditioning efficiency also allows for the accumulation of radon gas within the structure. To put it in perspective, outside air typically has traces of radon that measure .4 pCI/L. According to the EPA, the average level of radon gas our homes is 1.3 pCI/L. This doesn't mean that you're safe if you have a radon level of 1.3 in your home. It does mean that two non-smokers in a thousand who are exposed to this level could develop lung cancer as a result. For smokers, 20 out of 1,000 could develop lung cancer from radon exposure. As you can see, this is not a laughing matter.

Continue reading "Radon Gas: An Invisible Threat to Your Real-Estate Business"

Paint Chips Risk More Than Health

nospam@example.com (Eryn) — Wed, 4 Oct 2006 06:45:00 -0500

If you own a home built before 1978, chances are that it was built with materials and paint that contain lead. While this may seem of little consequence, it can have a serious impact on your real-estate business.

What are the risks of lead-based paint?

Lead poisoning is a common problem among children and can even affect fetuses in utero. Lead poisoning has been associated with numerous neurological issues including behavioral problems, memory loss, and learning disabilities. In most cases, the damage is permanent and irreversible.

Where is lead commonly found?

Lead is most commonly found in paint applied internally or externally to a house before 1978. Lead-based paint in good condition usually isn't considered a hazard. However, if any chipping or deterioration of the surface of the lead-based paint occurs, it's important to have repairs made immediately. Also, if you find lead-based paint in areas where children could put paint chips in their mouth or chew on the surface, such as windowsills, have the paint removed immediately.
Continue reading "Paint Chips Risk More Than Health"

The Update on Upgrades: Top Five Improvements to Maximize Return on Your Investment

nospam@example.com (Eryn) — Wed, 13 Sep 2006 06:45:00 -0500

New investors often aren't sure where to begin when updating a property. The wrong choices in colors or materials can completely turn off a potential tenant or buyer. Owners and investors must use their judgment regarding the needs of each individual property. Assuming that the property has no structural issues, you can't go wrong if you focus on these five areas of improvement.

Lighten and Brighten

Natural lighting induces feelings of well-being. To help maximize its effect, make sure all windows are clean. Raise or remove heavy window treatments that block light. Solar screens improve energy efficiency but reduce natural light. Consider removing solar screens while showing a property, and return them as a bonus feature after you sell or lease the property.

When you're showing a property to a potential tenant or buyer, make sure all blinds/curtains are open to let in the light. Replace tacky window treatments or damaged blinds/shades immediately, as they can cause a huge distraction. If a room has few windows, investigate options for adding can lights or track lighting to brighten things up a bit. Keeping wall colors neutral and light can also maximize lighting effects in a room.

Clean and Declutter

Nothing turns away a potential tenant or buyer more quickly than a property that is dirty and littered with trash and debris. Cleaning is not costly and will drastically improve the look, feel, and potentially the smell of your property.

If you don't intend to replace carpets, have them professionally steam-cleaned and spot treated. Also, have the bathrooms and kitchen cleaned and sanitized, and ensure that the windows are cleaned throughout the property.

Outdoors, focus your energy on getting rid of anything that remotely resembles trash. Remove any clutter that could detract from the look of the property.

Plumbing and Electrical

If you're working with an older property, it's a good idea to bring the plumbing and electrical systems up to code. This is especially important if you plan to act as landlord and don't want to spend every spare moment as a handyman. Electrical issues are also dangerous and present a threat to not only your investment but also to the health and safety of your tenants.

Landscaping

Landscaping can be as involved or as minimal as you want. Botanical enhancements can add greatly to curb appeal. In general, try to select plants that are low maintenance, hardy, and not seasonal. You may want to research plants that are native or that thrive in your area. In Nevada and other areas of the country, xeriscaping is very popular. Creating a rock garden is another way to minimize maintenance and water use. Whatever you decide, the best places to focus your efforts are near entrances to the dwelling and along porches and walkways.

Kitchen and Bath Upgrades

Many people will advise you to spend most of your money on improvements in the kitchen and bathrooms. I completely agree -- however, this category can raise your initial cost from the hundreds to potentially thousands. Flooring, counters, and fixtures are typically the first places to start in these rooms. You'll find that certain materials will increase your overhead but not necessarily your return on investment.

If your property contains old, cracked, or peeling vinyl flooring, you might find it worthwhile to replace the flooring. If you can afford higher quality flooring, current trends lean toward large tiles, stained/etched concrete, and wood or wood-laminate flooring. In homes that were built before 1960, you could be surprised to find original hardwood flooring beneath existing carpet. In this case, you've found a jewel in the rough because real hardwoods are currently very sought-after and expensive to install. Although it may be more expensive, consider refinishing the hardwoods to drastically increase the resale of your property. Carpet is still popular in bedrooms, but living areas and heavy traffic areas are typically being upgraded. Carpet in kitchens or around the wet areas in a bathroom is a huge no-no. If you own a property that features carpets in these areas, don't hesitate to upgrade immediately.

Countertops are also a nice improvement that can increase the appeal of a kitchen or bathroom. Tile is popular, but the grout around tile makes it less desirable for areas of food preparation. Grout also has a tendency to mildew and stain, but a good sealant can minimize these problems. In higher-end homes, countertop materials like granite, marble, and even custom concrete look appealing but are more costly.

Fixtures provide the widest range of possibilities for upgrades. Replacing lighting or plumbing fixtures in kitchens and bathrooms can vastly improve the look and feel of a property. Make sure the fixtures add interest but don't seem out of place. One improvement that can make a difference to the resale of a property is to replace a traditional tub with a garden or jetted tub. Many buyers and renters in today's market find this a necessary amenity.

As a general rule, draw up a plan for the subject property before you begin upgrades. Decide how to maximize the impact of your improvements with minimum initial cost unless you're targeting a market that values quality materials and upgrades. Again, check the location of your property to determine whether the neighborhood can support your asking price. Before you get gung-ho about renovations, remember that you can't justify the upgrades if you can't expect a return on them.

I recently discovered the Sell Right Home Staging website, the most informative tool I've seen to date about improvements you should make to prepare a house for sale or rent. I particularly recommend reading the site's useful statistics about home-improvement investments (PDF).

Don't Be That Landlord vol. I

nospam@example.com (Craig) — Sun, 27 Aug 2006 22:44:42 -0500

The main point of being a Landlord is to profit from sound, practical investment. This is understandable fact. It is understandable because it is the capitalist backbone of our entire system of freemarket ownership for things with speculative rates of appreciation. Namely: real estate. But there are other important, and arguably more socially responsible facets of being the proprietor of where other people sleep. Where they raise their children. Where they celebrate holidays. Where they experience life.

In that context, there are other responsibilities that need to be lived up to by Landlords. And some appear too cold-hearted to understand that. This is most unfortunate.

It’s yet another installment of “Don’t Be That Landlord�?.

There are tactics for getting rid of unwanted tenants, but whenever you’re involving armed men in camouflage fatigues who are often described as “thugs�? to help convince tenants to "willingly" vacate, you’re essentially playing the role of a criminal syndicate kingpin. Not a responsible Landlord.

Lead paint. Why is this still an issue today? The potentially prohibitive cost of removal and refinishing, of course. But one would expect that cost to be miniscule when put against the value of a child’s health. When it becomes known to the courts that some Landlords are aware that their properties contain lead paint, and still do nothing to remediate, the situation is bound to become litigious. And very few courts will side with ANY Landlord who knowingly jeopardizes the health of their Tenants. Especially children. Get it stripped off and redone already.

And then there’s the obvious appliance failure issue. Especially when it comes to Air Conditioning at the height of a record-breaking summer of heat. Sometimes it’s difficult to repair things in a timely manner. Perhaps all the maintenance companies are overbooked. Maybe it’s a holiday. You might even be on vacation, or simply live too far from your properties, and the coordinating of major repairs is duly hampered. But as a Landlord, there is a responsibility to make good on what was promised in a lease. And if Air Conditioning was promised in the lease, with the heat as bad as it’s been this summer, then a responsible Landlord would be constantly communicating with their Tenants about the status of restoration.

The Question Is Flooring

nospam@example.com (Craig) — Thu, 24 Aug 2006 23:22:02 -0500

Flooring is more than just a covering for the base of a unit. It has at least three potentials for Landlords.

It’s a potential selling point. Sometimes certain looks are “hot�?. Trends in flooring can make a unit far more attractive, and potentially worth more rent to particular renters. Some people demand hardwoods. Others LOVE to walk barefoot on thick-pile carpet. Still others simply want to live in whatever is the most current “in�? environment. Stained cement floors are in today, and in some areas, will pull a premium in rent.

The main question about trend-driven selling points is that yes, they may work today, but in ten years, will people scoff at a naked cement floor as being too much like living in a garage?

A potential time saver. Carpet, if cheap to purchase and install in your area, may be a perfectly reasonable and simple option for you. But those carpets will need to be cleaned periodically. And the price may be cheap today, but the cost five years out is something of a gamble.

Wood floors, if installed correctly and properly maintained, will last through your lifetime. But one bad finish mixing with one rambunctious dog or a marble column plant stand can be pricey to correct.

Stained cement, tile, and linoleum have significantly fewer maintenance issues. Linoleum/laminates may not last as long as stained cement or tile, but it’s much faster to install, and will certainly outlast just about any carpet.

A potential health concern. Off gases are becoming more and more of a serious environmental health issue. As a responsible landlord, this is a concern you should have when choosing new flooring. Not just for the potential future costs for replacement if one variety of flooring is deemed unsafe, but for the honest sake of the health of those you depend on for healthy, non-bouncing rent checks. If you are staining, using adhesives, or finishing the floors in any way, be it wood, concrete, tile, linoleum, or any similar material, be sure to check up on any known safety issues with the chemicals involved.

On top of that, many carpets are considered allergen traps, and sick tenants are not happy tenants.

Much must be weighed when choosing new flooring. Much indeed.

Between Tenants

nospam@example.com (Craig) — Thu, 25 May 2006 15:12:02 -0500

The previous Tenant has moved out, and you are wandering into The Property for a pre-rental-advert inspection. Time to take stock of what needs to be done, and what extra could be done to increase the rental value of your Property. New paint, flooring, and appliance inspection are pretty standard activities. But they don’t have to be oppressive cost-centers when basic repairs can be done with some simple elbow grease and a little know-how.

HandymanUSA is a great internet resource for finding out how to handle smaller jobs that don’t really require the use of a professional. Jobs like minor ceiling repair, drywall repair, interior painting basics, and appliance cleaning/maintenance/repair (scroll down to bottom for details). There’s even some tips on what to do about the flooring situation.

If your Property has usable outdoor space, you might even choose to add something to the yard which might increase its marketability. Perhaps a minor brick patio or some sidewalks. And if you’re less averse to risk, maybe even a simple yet tasteful deck to give you that extra “wow�? factor over competing properties.