Being a Landloard and Getting a New Tenant

Well, last month was pretty crazy. Sorry about the lack of posts. A dear friend of mine just gave me a friendly poke in the ribs to get off my butt and start writing, so here we are! Rather than writing some big long apology post about what the heck has been going on with me, I think I will just pick up where I left off and fill you in as we go along. So that said... here we go:

My tenant is moving out at the end of the month and I am a wee bit panicked about it. She just gave her notice a couple of days ago and is apparently moving out of state at the end of the month. The rent for the apartment is $550 a month... and that is not at all included in the $900 I have as a goal for each month, so naturally, I feel a touch nervous about it.

However, it isn't all bad. There are some things I would like to do to that apartment and this may be my chance. Let's look at the Pros and Cons...

Pros:

Heat - One of the issues my tenant had was with the heat. The heat for the unit is controlled in my section of the house, which only makes sense - I pay for the gas. My ex-husband rented the apartment to my current tenant and at the time told her it would "be comfortable." However, my idea of comfort and other people's ideas can be two different things. Plus, the apartment has only a few heater vents and several old drafty windows. So, she was cold. My solution at the time was to buy her a supplemental electric heater and window film insulating kits. However, this would be a prime opportunity for me to install some nice baseboard electric heaters. Then my new tenant will have the majority of the heat they need supplied by me and can then add more as they need it.

Refrigerator - One of the other requests my current tenant had was for a new refrigerator. I was actually planning on purchasing one for her this year. The one that is in the apartment unit now works, but admittedly, it is a bit dated. I've repaired it once and it cost me over $90 to do it, since the parts are obsolete. It would make sense to buy a nice EnergyStar energy efficient refrigerator. Not only would I be able to claim it on my 2010 taxes but it would be a relief to have it done before the other one clunks out. The only problem had been arranging delivery and replacement with the tenant, since she is rarely home (and I wasn't too keen on taking her items out of the old fridge and putting them in the new one.) If she is out of the unit, I can do it anytime I want.

Possible Income Opportunity - My home has a three stall garage. I like having all the stalls to myself, but I realize that it is just convenience. It would be fairly easy for me to move everything out of the adjoining stall to my own and offer a garage stall with an electric opener for an extra $25. Or then again, I could offer them the single locked stall - it doesn't have an opener, but it would let them lock up some additional storage items. ...actually, the more I think about it, I like that option better. Hmmmm.... either way, it would be a possibility.

Paint - My ex-husband has several rental properties and one of the things we used to talk about was "Better rental = Better tenants." When we worked on properties we always tried to improve the look of the apartments between tenants. This unit is actually really sharp and in good condition, except for the stairwell. It desperately could use some fresh paint and some molding repaired. This would give me the chance to do it.

Cons:

Money - All of the above repairs cost money. Yes, they are items I can claim on my taxes, however, I won't be seeing that money back until next year. I have money set aside that I was going to use for some of these home repair projects, but now I am wondering if I shouldn't keep as much liquid as possible just in case it takes awhile to find a new tenant. The question then is, will the repairs draw new (better) tenants or does it make sense to woo them with promises of all the things I will do... once they sign the lease.

Lack of Income - While I do have a cushion of funds set aside for just this case and can go fairly easily for a few months without a tenant, but I don't want to go too long. The longer I go the more I deplete my reserves.

Finding a Tenant - One of the things that just stinks about being a landlord getting new tenants. Showing the apartment, getting applications, doing credit checks and all that is a fair amount of work, and extra time isn't something I have a lot of right now. It isn't something I can afford to put off though, either. It is going to have to be a big priority.

To Dos:

Here's some of the things I can get working on right away:

Put Together a Lease - As I mentioned, my ex-husband was really the landlord and he had a contract he used that he got through his membership in the local Rental Property Association. I have a copy of it, but not a clean one I could give to someone. I also have a copy of the lease I signed when I lived in my last apartment. It was owed by someone like me and they had had a lawyer draw it up. It had some great language in it, so I have saved it. One thing I need to get done ASAP is putting together a lease and having it looked over so it is ready to go.

Check Up on Credit Checks - My ex also used his connections with his Property Association to do this. I don't have a membership there, so I need to decide what company I am going to use and look into costs. He charged a $25 nonrefundable credit check fee, which paid for the checks, but gave the new tenant $25 off their first month's rent. I have to decide what I want to do about this.

Get Photos of the Apartment - Though I would almost rather photograph it empty, the current tenant has it decorated very cute, and I just don't want to wait until she moves out to get on this. I can always take some now and replace them later, if necessary. They will be used for...

Advertising the Apartment - Time to do a little research. I already have mentioned it to a few friends and put a little note on Facebook, just to get the ball rolling. There is a website for apartment rentals in town, I will want to see how much it costs to use them. I will also be looking at Craig's List. In the past my ex just put a sign in the yard, but I think I want to be more proactive than that. I will be out of town next week so I probably won't start it until the week of the 18th.

Review the Apartment - It's been a few months since I was last in the apartment. I'll need to get in soon and get a feel for what types of work, other than cleaning, I have to plan on doing. Having a plan is always a good thing.

So that's what I have on my plate for the next couple of weeks, how about you?


Photo by: Laurie.McGregor
via Flickr