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Boston Property Care: Banker & Tradesman's Best Of 2022
We are pleased to announce that Boston Property Care has earned Banker & Tradesman’s Gold award for Best of 2020 in Residential Property Care.
There are a lot of folks becoming new landlords, both as first time investors and as a group we at BPC call "accidental landlords", or people who bought their home but are now moving and don't want to give up the option of returning in the future, thus renting it out in the short term. With real estate investment in Boston predicted to climb steadily, it’s a great time to begin generating income via homeownership and learning how to best do that. Spend Now to Save Later “Don't go cheap” on property upkeep, warns Al Norton, our rental manager with more than 10 years of experience. Yes, it may seem easier on your bank account to make your tenants do their own snow removal, but “if there's any sort of issue with someone getting hurt on snow/ice on your property, they're coming after your deep pockets, not the tenants”. As far as lawn care goes, how it looks impacts your bottom line in the short and long term way more than it does your tenants. Besides, taking care of all of that kind of thing can allow you to charge more in rent, as there are tenants out there willing to pay more for the convenience. Pay Attention to Your Insurance Policy A big thing that most landlords miss? For those who were living in the unit previously, you will need to reach out to your insurance company for a policy change. Since the property is no longer an owner occupied unit, your insurance provider needs to be updated of the change in case of liability. Not doing so can be disastrous: if landlords submit a claim for damage done by tenants, the insurance company may not cover it because they had the wrong kind of coverage. Reduce Stress with Property Management Some may think that being a landlord just means cashing checks every month. However, unlike stock market dividends or accruing bond interest, real estate investment is not a passive income stream. Landlords deal with property upkeep as well, which includes repairing appliances or fixing other issues as they arise. For many landlords, using a property management company is worth avoiding the hassle. While this service again costs money, it also means that the landlord is spared from everyday frustrations or emergencies. “The landlord isn't the one getting the call at 11:30pm on a Friday night about a clogged drain, or, worse, getting woken up a 3am because of burst pipes,” Norton says. Save Big with Real Estate Agents and Tax Breaks The best advice we can give is to use an agent. A licensed real estate professional will do the job for you, “the job” being all of the following: Marketing your property Showings for prospective tenants Collecting applications Completing financial and background checks to ensure the tenant is a good fit Writing the contracts and ensuring all other paperwork is completed Confirming that the process is done in accordance with the law In the current market of high demand and low inventory, using an agent’s services may not even cost anything. Even if you do end up paying them some part of the rental fee, that's a tax deductible expense: your house or condo is now a business, and therefore eligible for certain deductions. For more tips on real estate investing or long-distance landlording, we’re always available at info@bostonpropertycare.com. 5
One of my favorite rental urban myths – you know, the apartment leasing equivalent of being told that the student handbook has a rule that you can leave if your teacher is more than 10 minutes late – is that there is some sort of law about when landlords can ask their tenants if they are planning on renewing their lease; there is no such law on the books in Massachusetts, nor is the matter addressed in any of the Standard Fixed Term Leases I have seen (self-renewing and tenant-at-will leases are obviously different). So that leaves many landlords wondering, when should I find out if my tenants want to stay? My general advice is that a rental listing should come to market roughly 60 – 90 days before it is available to be occupied; even in a strong rental market like Greater Boston is experiencing now, where apartments can rent in days, or even hours, you want to give enough time for the unit to be properly marketed and shown. I’ve known some landlords to wait until less than 30 days before occupancy but the potential problem is that there usually aren’t that many people looking that close to their move-in dates, and the smaller the pool of potential tenants, the less able you are to maximize the full value of your condo/house. The best way to reach out to your tenants is with a letter, telling them that it’s that time of year again and that you’d like to know within two weeks if they plan on staying, with the understanding that if they aren’t staying, showings of the unit will begin right away. Most landlords will tell their tenants what the rent will be for a new lease in that same letter, although I’ve known a few who wait until people say they want to stay until they inform them of the new rent. When it comes to increases, I find it’s best to be honest with tenants and tell them that while their rent is going up $XX per month, the truth is if the apartment were going on the open market the rent would be going up $XXX; essentially let them know the discount you are giving them for being good tenants. Once you factor in the two weeks’ time you will give your tenants to make a decision and get back to you (and perhaps the extra few days to get them to respond), you want to get the whole process started no later than 90 days before you’d need a new tenant. And to answer your question before you ask, yes, there is such a thing as too early; no one other than undergraduate students are going to rent an apartment six months ahead of time, so putting it out there now for June 1 means it will likely end up sitting for a while, potentially letting your listing get stale and lost in the shuffle when the influx of property comes on weeks later. No matter when you decide to send your current tenants a renewal letter you should check in with your friendly neighborhood real estate company – like, say, the Coolidge Corner, Jamaica Plain or Newton Centre offices of Unlimited Sotheby’s International Realty, where there are well trained, full time rental agents waiting for you – to find out what’s going on in the market; maybe you’re way under the average price, maybe you should be thrilled with the rent you’re getting, but talking to a professional will give you peace of mind going forward. Boston Property Care can also take the hassle out of dealing with tenants for you. We are happy to reach out and coordinate renewals with your tenant or find you someone new! Al Norton Rental Manager, Boston Property Care
