A landlord is bound to encounter problems with tenants, but at times, you might not know how to handle these problems. Many landlords wonder how to deal with a tenant who is a hoarder. This issue can be problematic not only for the tenant but also for other units around the hoarder. If you are concerned one of your tenants is a hoarder, here are a few things you can do to better the situation.

Understand Hoarding

Some people do not understand just what hoarding is. Landlords should know it is much more than just collecting odds and ends. Hoarding is considered a mental illness related to obsessive-compulsive disorder. By understanding this fact, you can see that the situation is not one where you can just issue notices and complaint letters.

Don’t Discriminate

Dealing with a tenant who is a hoarder can place the landlord in a sticky situation. While you don’t want to discriminate, you still want the property to be a nice place for other tenants to live. When you are dealing with a hoarder, be sure to avoid an argument with the tenant and try to focus on the problems that result from hoarding rather than your personal opinion about how the tenant lives.

Check Lease Breaches

If you believe your tenant hoarder is in violation of their lease, you have every right to begin eviction. Grounds for eviction include breaking building or fire codes, damaging the physical property or endangering others. Some hoarders store property that can present a danger to other tenants in the building. Also, a hoarder could have items stacked up to the ceiling, interfering with ventilation or sprinkler systems. These are all grounds for eviction, as they can create a dangerous environment in your building.

Document Conditions

If you do believe your tenant is breaching their lease with their hoarding practices, you will want to first begin documenting the conditions. You can present these concerns to the tenant and give them time to clean up their act. If this does not occur, as a landlord, you will want to consult a real estate attorney to see where you should go from there in terms of starting the eviction process.

Consider the Hoarder’s Neighbors

As a landlord, you have a responsibility to the other tenants in the building. If the hoarder’s practices and behaviors are blocking common areas or emitting odors or attracting pests to the building, you owe it to your tenants to find a solution to the problem. A landlord would hate to lose good tenants over ignoring a hoarder’s effect on others.

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Landlords often explore the lease-to-own option with tenants. This option carries many benefits. It can be especially appealing in down markets when properties are just not worth what they once were in a strong economy. If you are looking to sell your property, you can often explore the lease-to-own option with tenants instead of just renting. But one of the biggest challenges with this option is how you go about setting a sale price on your property for lease-to-own agreements.

Get Back to Basics

Landlords should factor in three main values: the current value of your property, the estimated value of your property when the agreement ends and the future market value of your property.

Select the Best Price for Your Property

If you want to gauge a property’s sale value based on its current value, you can easily look at the values of properties in your area. However, estimating the value at the time the lease-to-own agreement ends can be the landlord’s best option. In all likelihood, this number will be higher than where the property’s value sits today. The future market value is best determined by how much rent increases each year. This can open up more cash flow for the landlord at the end of the lease-to-own agreement. The hope is that rent increases will outpace inflation and allow the property value to increase.

Set a Wise Monthly Payment

Landlords in a lease-to-own agreement will want to set a monthly payment that is higher than what they currently receive for rent in the property. Monthly rents will not be enough cash flow for the landlord to put toward the tenant buying the property. The landlord needs to make sure the tenant has enough cash flow to not just pay the rent, but also to pay the monthly amount toward owning the property.

Look at the Mortgage Payment

Another easy way to set the sale price of your lease-to-own property is by using the mortgage payment as a gauge. Landlords can often set the monthly payment to be close to what the buyer would be paying if they were taking on the mortgage. Under these terms, the landlord allows the future owner to purchase the property without using bank financing.

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It can’t be said enough how important curb appeal is to getting your property occupied by a great tenant. Unfortunately, it’s not just your property that prospective renters evaluate when they come for a showing; the way your neighbors treat their property can make a big difference to your future tenants.

All-Around Curb Appeal

Having the best looking lawn on the block can be both a blessing and a curse. It’s true that it’s good for you because it shows how much you care about maintaining your property and encourages your tenants to do the same. At the same time, though, it can also highlight how little work your neighbors put into their properties, and can even turn off prospective renters. While it’s difficult to predict how a neighborhood will change after you purchase the property, you can do your best to encourage your neighbors, especially if they’re fellow landlords, to maintain the curb appeal of their homes. Not only does it welcome prospective renters, it keeps property values high, guaranteeing the investment you’re making will pay off.

Neighborhood curb appeal isn’t the only thing that turns renters off, however. A neighboring property might be as nice as possible, but if the tenants are loud or rude, it can definitely pose a problem.

Being a Good Neighbor

While cleanliness and safety are often the two most important things prospective renters look for in a property, having a quiet place to call home often comes in a close third. Even students want peace once in a while, and bad neighbors can really spoil that. Neighbors who consistently throw large, loud parties until late at night are often more annoying than fun, and can aggravate your tenants enough to cause them to move. Excessive visitors can be a concern for your renters as well. Again, it’s difficult to change your neighbors, but discussing the issues with them or their landlords might help. You can even encourage them to take a different approach to tenant screening.

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Nothing can be more costly to your job as a landlord than a tenant who has turned your property into a drug house. Drug houses spring up across apartment buildings and condos. They can be right under the nose of the landlord. Look out for these signs that your tenant has turned your property into a drug house.

Bright Lights

If you notice your tenant has high-intensity lamps, this may be an indicator that they are growing drugs in their rented space. A tenant utilizing such bright lights for grow-ops may try to cover up their windows with dark curtains at all hours or board up doors and windows so that outsiders don’t see what may be going on inside.

Strange Smells

If you suspect your tenant is operating a drug house, you might start to notice strange smells coming from their space. Drug houses can smell of ammonia, acetone, solvents and acid. If you catch a whiff of any of these smells, it might be an indication that the tenant is running some sort of drug operation.

Weird Visitor Hours

As a landlord, you tend to notice who comes and goes from the property. If you suspect a tenant might be running a drug house, they could have many unsavory visitors arriving at all hours of the day. These visitors don’t tend to stay long, since they are just getting in and out with what they want. Landlords should pay attention to the times your tenant has visitors. If people are coming over at 1AM for 5 or 10 minutes, this could be a sign of a drug house.

More Crime

If there is an increased amount of crime taking place at your property, this could also be a clue that your tenant is operating a drug house. You might hear people yelling, loud music or even gunshots in and around the property. If vandalism and burglaries are increasing at your property, this can be a telltale sign that a drug house is operating in your building.

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The security deposit is something that many landlords actually fail to collect when a new tenant moves in. Often, first and last month’s rent is requested and received, but landlords incorrectly believe that the last month’s rent also acts as a security deposit.

In a way, the last month’s rent does provide added security, as you already have those funds available to you should the tenant vacate the residence without notice at any time, even if it’s at the end of the lease. Some tenants just aren’t honest, and believe that they can get away without paying if they are going to move anyway. If you already have the last month’s rent on hand, you will not be without that required payment.

However, you cannot typically use a tenant’s last month’s rent payment to make repairs, or deal with any other costs that pop up as a result of a tenant’s behavior. Last month’s rent is as stated – it’s for last month’s rent. The security deposit covers other issues. Effectively, a security deposit can be used to cover any unpaid rent, or any other costs that should be the tenant’s responsibility.

Landlords that choose not to ask for both first and last month’s rent and a security deposit when a lease is signed should at least ask for a substantial security deposit equal to one month’s worth of rent for the following reasons:

• It might tell you something about the financial stability of a tenant – a tenant that can’t afford one month’s rent, plus a security deposit that is equal to another month’s rent may not be the most financially stable. After all, it likely means that they are living paycheck to paycheck, and they may be unable to afford to pay their rent if something unforeseen happens in their life. Now, it doesn’t mean that you need to deny a tenant as a result of this if you are comfortable with a smaller security deposit; but the tenant’s access to these funds is something to keep in mind.
• The security deposit will cover your mortgage payment – if the tenant does default on their rent, you are more financially secure by having a sufficient enough payment to cover it. This guarantees that you’ve got money from the tenant to cover at least one month’s payment if they are unable to pay you.
• A larger security deposit should cover damage – the larger the security deposit, the more likely it becomes that it will cover the cost of any property damage left behind by the tenant. If there is damage, and they are up to date on their rent when they vacate the residence, you can simply return any funds that you did not need to use for repairs.

While asking for a larger security deposit does offer you increased protection, there are limits on how much you can request. These limits do vary by state, but the maximum allowed is typically no more than 2 month’s rent if the property is unfurnished, and 3 month’s rent if the property is furnished. You also have the right to request first and last month’s rent; but you’ve got to consider that not all quality renters can afford to pay all of the above when they sign the lease.

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In an ideal world, your tenant pays all of their utilities and they do so on time. However, landlords know that this is not always the case. Some tenants neglect to pay their utility bills on time. In the process, you find yourself dealing with damage to the property. It is important for property owners and managers to make this decision by considering all of the factors for or against keeping the utility bill in the tenant’s name.

When the Tenant Fails to Pay the Bill, You Pay

One pro for having the utilities in your name or the property owner’s name comes with major problems, like when the power goes out. If your tenant stops paying their power bill and the power goes off, you could face damage to your property such as frozen water pipes in the winter. When this occurs, the damage will often cost much more than the amount laid out in the security and damages deposit for the tenant.

Find a Compromise

There is a way you can have your tenant keep the utilities in their name, but you still have a say in the matter. Many utility companies have a provision where a landlord can be the master account holder. This can prevent situations like the one above if the tenant fails to pay the power bill.

Be Aware of Utility Confusion When a Tenant Moves

A benefit to being the master account holder on the utilities bill, in addition to preventing frozen pipes before they occur, comes when the tenant moves out. If your tenant moves out and pays off their utilities, the bill can sometimes still be in their name. Landlords should be aware of this when a tenant moves. If the utilities are in the tenant’s name, you could face problems when they move out. Always be sure to sort out transferring the utilities before the tenant moves out.

Billing the Tenant

If your utility company doesn’t allow you to remain as the master account holder with the bill in the tenant’s name, you might want to keep the utilities in your name and bill your tenant instead. This practice is probably one of the safest for the landlord. You can make sure that the power in the building remains on and you won’t face damage to your property by way of frozen water pipes.

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When you have a tenant that you’ve signed a lease with, sometimes their life situation changes before the lease is up. In some cases, they may want to add a new roommate to their household. But is it appropriate for them to just go ahead with that, or should they ask you first?

What you need to keep in mind is that a lease is a written contract that binds you and your tenant to its terms. If you ever need to take your tenant to court and not everyone living in your property is on the lease, you may not be well protected. Now, that does not mean that you cannot allow someone additional to live in the property, but it should help guide some of your decisions.

First, only consider the option of allowing a tenant to add a roommate if they have asked you about it first. If they decide to move someone in without bringing it to your attention and you suddenly discover that there is a new permanent resident, don’t just ignore the issue. Second, don’t take the decision lightly if they do ask. After all, there could be legal ramifications, so you do need to stop and think about what you’re doing and determine how important it is to please the tenant making the request. After all, you went through the process of reviewing rental applications to choose your existing tenants. Adding a roommate means you miss out on that opportunity for the new resident.

If you decide not to allow the new roommate, your tenant will have to break the lease in order to move out. However, if you want to keep a good tenant, you do need to be willing to make concessions. After all, a single who moves into your property could meet the person of their dreams and want to live with them. They may choose to break the lease even if they have to pay a penalty. And then you don’t know who you will have to deal with the next time.

So essentially, what you have to assess is whether or not the existing tenant is one worth being flexible with. If so, then consider allowing a new roommate, provided you add them to the lease for everyone’s protection!

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Landlords can find themselves in sticky legal situations with tenants when it comes to their long-term guests. Long-term guests can be a bit of a gray area for property owners and managers. You may have written in the lease that a tenant can have guests, only to find they bent the rules a bit and have invited their friend to stay for months on end. If your building is on a shared utilities plan, this extra person can weigh heavily on your finances. At the same time, you need to know how to deal with long-term guests legally rather than taking rash actions.

Understand the Laws

Most state landlord-tenant laws dictate that those who establish residence in a place, even if they don’t own it, are still protected. However, this rule does differ when it comes to long-term guests. Long-term guests are not protected. In a court of law, the judge would determine if a person is a transient guest by how long they have lived there, if they get their mail at the property and just how much control they have over the space. If you want to get rid of a tenant’s long-term guest, you would merely follow the same actions you would for eviction.

Watch Out for the Warning Signs of a Long-Term Guest

If you are worried your tenant might have someone living in their unit for a long period of time, you can usually see the warning signs. Landlords should take notice if the long-term guest starts receiving mail on site. If the long-term guest doesn’t appear to have any other residence, they have most likely taken up residence with your tenant.

Follow the Steps Toward Eviction

If your tenant isn’t allowed to have guests beyond a week or two and you suspect they are housing a long-term guest, you can begin the eviction process. The landlord should issue a notice to quit to the tenant and their long-term guest, informing them that they need to get their guest moving or their lease will be terminated. If the notice goes without action by the tenant, you can then issue a summons and complaints. The tenant can then face court appearances where they must answer to the complaint.

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There are instances where a landlord can lose an eviction case due to their previous actions. In these circumstances, it doesn’t matter if the tenants have failed to pay their rent, or if they have caused damage to the property. Your request to have them evicted may not lead to a desirable result immediately when you make the following mistakes as a landlord:

• You allow rent to be paid late – if, on numerous occasions, you have told a tenant that it is okay if their rent is late without penalizing them or giving them a verbal or written warning, you are saying it’s okay for them to pay late on an ongoing basis. This can be a slippery slope, as the tenant may start to pay later and later, or fail to pay rent at all. If receiving their rent is not your priority, then paying the rent will not be theirs. Of course, you can provide some leeway if a good tenant comes to you with a problem; just don’t allow it to become an ongoing habit. Otherwise, when you move to evict, the tenant can argue that paying late is just a part of their arrangement with you.
• You overlook obvious issues – if your tenant has been causing damage, having loud parties that disturb the neighbors, or has a dog in the residence that has a history of aggression and you choose to overlook it, this could be a problem for you later. Again, in this circumstance, if you file to evict them, it may appear as though you’ve been condoning the behavior and the courts may not honor your request right away.
• You haven’t provided warnings in writing – by law, tenants have an opportunity to modify their behavior before eviction. That means beginning to pay their rent without delay, rectifying any damage issues, and basically doing whatever it takes to abide by your lease terms again. If there is a problem, make sure it is noted in writing and provided to the tenant. That way they have no opportunity to argue that you didn’t notify them that their behavior was a problem. Make sure that you keep copies of anything you provide to the tenant as well.

The better organized you are as a landlord, the more likely it becomes that things will go your way if you need to evict your tenant before the end of their lease. So keep the above in mind to govern your actions!

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When you’re a landlord, managing your own property or properties is a way to keep your costs low, and it allows you to turn a larger profit from your rental. However, over time you may start considering the option of hiring a property manager to take over for you – whether it’s due to time constraints, a desire to focus on other projects, or simply a feeling that you’ve taken on too many investment properties to do it all on your own. Regardless of the reasoning, you should think through your decision carefully, and part of doing that is understanding what a property manager offers you.

What Do Property Managers Bring to the Table?

• Fast response time to prospective tenants – if you’ve got another job and maintain your rental in your spare time, you may not be able to get back to people as quickly as you need to. There are tons of rentals on the market, pretty much at all times. If you don’t contact someone quickly while they’re waiting for information, someone else might just snatch them up.
• A higher level of objectivity when dealing with difficult tenants – if there is an issue, it’s easier to take it personally when it’s your property. After all, you’re the one that has to come up with the cash if your tenant fails to pay their rent on time, for example. But working with a property manager means that the issue can be dealt with in a way that avoids rash actions that may get you sued!
• Experience with maintenance – landlords have the tendency to try and do all property maintenance themselves, and that isn’t always a good thing. You may also find yourself in a blind panic when a tenant mentions that there’s been a flood, and lose the ability to make rational decisions with regards to outsourcing the repairs. A property manager may be better suited to make a calm, logical decision in moments that require quick, decisive action.
• Useful advice – you might think you know it all, but as real estate professionals, property managers (at least some of them!) may have the leg up when it comes to tenant screening, pricing a rental, and more!

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