Every tenant wants to feel valued and heard … And every landlord wants to have easy and happy tenants!
The solution is easy: Treat your tenants with the attitude that the customer is always right (even if they aren’t). Giving a little gets the landlord a long way. Maintaining a good relationship with a tenant is what keeps them happy and at bay.
Communication is the key to success
The best way to do this? Always be in constant communication! When issues arise, it is extremely important that your tenants are being heard and that their issues are being resolved as soon as possible. Even if it takes longer than expected, your tenants want to know they haven’t been forgotten about. They want to know they’re being treated fairly.
At MerGo Property Management, we have systems in place to make sure our tenants’ maintenance requests and needs are heard and addressed within one hour. You’ll want to be sure to develop your own system to make sure your tenants are being heard.
Rent compensation: when should I use it?
If you can maintain consistent and friendly communication, you’re already ahead of the game. BUT, if serious issues arise and you lose control of a situation, offering rent compensation can be beneficial to avoid a larger lawsuit. This is a last resort effort, though, and should only be considered when a tenant has a legitimate claim. The eviction process in Massachusetts is extremely difficult, expensive and often uncertain for the landlord. We recommend doing what you can to keep your tenants happy. This means providing great customer service to avoid losing control of a situation or doing what must be done to regain control if it is lost.
The bottom line is that you should strive to maintain good communication and rapport with your tenants. This will not only make your life easier but, when issues arise, your tenants will be more likely to work through the problem instead of taking rash measures.
If you have further questions, please request more info — we’re always happy to talk about your property and how we can help you be a successful landlord!
As a Boston property owner, you’re probably well aware of the typical rental cycle in the city. Roughly 65% of tenants are on a September 1st cycle and the rest are on a handful of different dates — June 1st being one of the most common. When those dates start to approach, you’ll probably find yourself asking some questions, like…
When should my tenants renew their leases?
How much time should I give my tenants to sign?
Should I be raising the rent? By how much?
What is the property value?
With a combined 15 years in real estate and property management, we’ve answered these questions for many property owners in the Greater Boston Area.
In our experience with rentals, renewals, and management, the best time frame in the Boston market to send rent renewals is between 120 to 180 days in advance of lease expiration. At first, that number can sound crazy — 120 to 180 days? That’s just about the same amount of time it takes my tenants to move in and get settled!
But hear us out.
The Boston rent renewal “golden rule”
We facilitate over one hundred rentals a year, and what we’ve learned with our rental clients is that they are well aware of the competitive rental process in Boston. To combat that — and still land a stellar apartment — they are reaching out to real estate firms almost 4 to 5 months before move-in. And depending on the neighborhood, it could be upwards of 9 months in advance.
In short, if you wait too long to send out your renewal notices and one of your tenants chooses to move out, you’ve put yourself at risk of finding a good candidate for optimal market rent. So put yourself at ease and follow the “golden rent renewal rule” of 120-180 days.
If you’re already in that “danger zone,” get your renewals out as quickly as possible! If someone doesn’t choose to renew, call a broker to get it on the market right away.
At MerGo, we’re always happy to have a conversation and help you — especially with our resources as real estate professionals on the Walker Residential Team at Berkshire Hathaway.
Next steps: reply timelines, rent increase, non-renewals
After sending renewals, give the tenants 10-14 days to reply. Again, you might be thinking, “Is that enough time?” Yes, it is. Most people know if they will stay or go. If you give your tenants a renewal without a timeframe for replying, you risk ending up in a situation where it becomes extremely difficult to re-rent the unit.
As for how much you should increase the rent, we usually recommend around 3-5% of the current rent amount. Ideally, this number would be found by factoring in many different aspects from a comparative market analysis, which can be performed by an experienced real estate professional.
Some other questions to consider with rent increases could be…
Does the unit require repairs or upgrades? Unless those are completed, you most likely shouldn’t increase your rent
Similarly, what is the status of the overall building?
How much did taxes, water, gas (if applicable), and sewer increase? Are there any other services that increased in price?
These are just a few circumstances that you should be taking into consideration when you are deciding rental prices.
In the rare and unfortunate case that you have a tenant that chooses not to renew a lease with, it’s important to speak with an attorney who specializes in landlord-tenant law. Regardless of whether or not you raise the rent, send a rent renewal, or send a non-renewal notice, prepare to hear from the tenant and be able to explain any changes made.
Set yourself up for success
In sum, you want to be a fruitful and prosperous property owner and landlord. While that may seem easy on the surface, it’s also important to be aware of the unpredictability and risk you experience as a landlord. So, we urge you to err on the side of caution and take action on these issues as soon as possible. That way, you can set yourself up for success right now, as well as preparing yourself for all of your future property ownership endeavors.
MerGo Property Managment is speaking at a Mass Landlords event, Tuesday May-15th in Cambridge!
MerGo will be giving a 45-minute presentation on what a property management company does for a property owner. This is not a sales pitch. Instead, this presentation will be intended to help property owners understand how to run their property like a business. We will go over the services provided by a property management company, and how to find a property manager that is right for your needs. Food and drinks will be provided — this is also a great opportunity to meet other landlords in the Boston area!
How to run your property like a business
We will get into what it means to run your property like an income-producing asset and business. Self-managing your property can be a lot of work, but with the right tools and systems, you can do it. MerGo will go over the pros and cons of property management so you can determine if self-managing or professional property management is right for you. We will also discuss our systems and what we have found works for tenant and maintenance management. We have done extensive research into various software platforms, accounting systems, and maintenance allocation processes.
We are all about efficient systems and customer service. Come learn more about the property management game and how to get the most out of your property!!
Mass Landlords is an essential resource for landlords in Massachusetts. They are a nonprofit trade association designed to help educate property owners on the latest laws and trends in the world of real estate investment.
This is the competitive edge your investment property needs
Becoming a landlord may seem scary at first, but it’s undeniable how successful you can become if you take the right steps.
At MerGo, we work with tons of Boston clients (some who own several units in multi-story buildings, and others who are just starting to rent out their properties for extra cash flow). Regardless, they are all working to increase the ROI of their investment property. We often get asked, “What are some quick fixes I can do to increase the value of my property?”, especially as people are looking to put it back on the market for new tenants.
Here are our 5 tips for winning renters over and getting the best ROI for your investment property. This is what you need to gain a competitive edge, without breaking the bank!
1. Make your front entrance POP!
Prospective renters will be walking into plenty of homes and apartments before they commit to signing a lease. An easy way to set yourself apart from your competition is through simple curb appeal upgrades. Looking at your investment properties, what could you improve on?
Landscaping. In Boston, properties outsides can look…well, less-than-desirable after a brutal winter. Take advantage of the first few weeks of spring (and all that rain) by sprucing up the outside of your apartment building or house. With just a few bags of mulch and climate-appropriate shrubs and flowers, you can make a big difference in just a few hours. And, if you’re willing to tackle the project all on your own, you’ll only be paying a relatively inexpensive Home Depot bill — roughly $200.
Entrance Way. Is your entrance’s pathway or stairs trip-free and safe for people to be walking on every day? If there are breaks in the pavement, make sure to fill them in. Do your stairs or railings seems to be uneasy? Take the time to rebuild it. If you can use the same materials — great! These small changes can make a huge difference later on in the year. Beyond safety hazards, how does the pathway/stairway look? Is it clean and bright, without any signs of harsh weather or obvious neglect? If not, take the time each spring to pressure wash any concrete or brick areas to get that fresh, new feel for your rental property. And while you have a pressure washer handy, don’t be afraid to wash the siding either! (Although, make sure it won’t cause any damage before you begin.)
Front Door. Does your front door look newly painted? Does it have a working doorbell or buzzer system? Does it make people feel welcomed and excited to come inside? A fresh coat of paint or upgraded hardware can make a world of a difference when changing your front entrance. To help you with some ideas, check out the DIY Network’s gallery of inviting front door colors. They’ll go more in-depth on color theory and how color can change your perspective!
These are just a few of the questions you should be asking yourself as you plan to upgrade your investment property in order to give it that competitive edge.
2. Breath new life into your space with fresh paint
A fresh coat of paint on your walls makes all the difference when it comes to making your investment property appealing to potential tenants. But before you get to painting, make sure you prep the area well. Wipe down all the walls with a wet cloth to avoid any dust mixing in with your fresh paint.
And now that you know painting can increase the value of an investment property, be smart with what colors you choose. You are trying to make your property appealing to a wide variety of people. Here are our tips:
Choose a color palette. Check out Benjamin Moore’s Color Collections to help you come up with new color combinations. We love “A Fresh Look at Monochromatic” by Benjamin Moore.
With small spaces, keep it light. If you are working with a studio apartment or cramped kitchens and bathrooms, keep the paint selection relegated to lighter tones. This will make the room seem bigger and cleaner.
Don’t forget the trim! A freshly-painted room only looks like a million bucks if it has the clean, white trim to match. Don’t forget this small but incremental part of the painting process.
3. Deep Clean (gloves recommended)
We always hear stories of old tenants moving out of their apartment and leaving the space absolutely filthy. Here’s how you can take a few steps in the right direction…
Rent a carpet cleaner. You can either hire a professional team or personally rent a carpet cleaner from your local supermarket or Home Depot. To make life easier, you can check out the availability of a carpet cleaner online here. Pro Tip: Always remember to move as much furniture off the floor as possible, if there is any.
Dust all the windows and blinds. Renters, for the most part, don’t put in as much effort as homeowners when it comes to the daily maintenance and upkeep of their home. So you might notice that windows have never been cleaned or the blinds have accumulated 3+ years worth of dust. The easiest way to go about it? Take all the blinds off at once and dedicate an entire afternoon to cleaning them up. By the end of the day, it will look like you bought completely new blinds for the entire space (without spending an arm and a leg).
Make a checklist for yourself, and separate it by room. When a tenant moves out, it can be overwhelming to organize the entire space (especially on a deadline). So make a checklist for yourself based on each room in the house. Consider all the appliances or specifics per room. In the kitchen, you’ll want to make sure the oven has been fully wiped down and in the bathroom, you’ll want to make sure the drain has been thoroughly cleaned and water is draining effectively. House Beautiful has an awesome checklist that you can use to make sure you’re not missing anything important!
4. Declutter where you can
So let’s say you have a larger building with a number of units in it. What does your lobby look like? Is it clean and spotless? Is there old mail piling up in the corner of the mail room?
Take the time to declutter your common areas! When people are looking for their next home, they want to make sure everyone in the building respects common spaces. And this is just as true with the management team who is managing the building. Make sure you have a team that is going in at least twice a month, vacuuming or mopping the common spaces and cleaning up areas that can easily get cluttered — like the laundry area, mailroom, or basement storage.
5. Upgrade your hardware
This is such a simple but often overlooked step when trying to increase the value of your property. Take a look around your home — could the kitchen cabinets use updated knobs or handles? What do the bathroom lights look like? Bad hardware can instantly date your space. Small upgrades like replacing your hardware have proved to offer an 83% return on investment — unlike expensive kitchen remodels!
Start with the kitchen and bath first, as this is where you’ll see the best ROI. Cabinet knobs and lighting fixtures are a great place to begin. Always think about fixtures that will compliment the space, rather than compete with it.
Pro Tip: Don’t get overwhelmed by what’s in style now — think about what will work long term. For instance, while copper happens to be a trendy metal right now, it might not be five years from now. Opt for something that will last at least ten years. Steel is always a great option that’s forgiving as years go by. This is our favorite cabinet pull at the moment.
A common question that many landlords and property managers are asked is whether pets are allowed in the unit. This is a tough situation for many landlords and property managers. Throughout the Boston area, it is common that rental units do not allow pets.
Why aren’t pets allowed in rental units?
Landlord and property manager’s insurance and liability coverage increase with pets in the unit, there are allergy concerns, and the unit is more likely to be damaged by the pet. Many people think of just cats and dogs for a no-pet policy, but this also includes fish, reptiles, and birds.
So, what sort of damage could a fish or reptile cause? They seem harmless, after all, but they are included in no-pet policies for many reasons. If a medium to large fish tank were to break, the water from the tank would leak onto the floor. The water would then go into the unit below, causing damage to the floor and ceiling. These pets can also cause problems with allergies for other people living in the building.
Can I convince my landlord to allow my pet?
Many leases and lease addendums have no pet clauses but may allow certain pets with written permission. If the landlord gives permission for the pet, they may ask you to provide certain information, like documentation that the animal has all appropriate immunizations and has no bad history with people or other animals. The landlord may also ask for confirmation from roommates that they are okay with the pet residing in the unit. The landlord has the right to say no and abide by the lease agreement.
How are service animals different?
Service animals are not pets, but working animals. They are trained to perform a certain task to help people with a specific medical condition. This includes physical, sensory, psychiatric, intellectual, or other disabilities. They are allowed in any public and private facilities that patrons are allowed. (You can find out more about this here.)
Long story short: If you are thinking about getting a pet or if you are moving into a property with an existing pet, always speak with your property manager or landlord about it!
Hiring a property manager in the Greater Boston Area
There are many reasons a property owner may want to hire a property manager. A few reasons include; not living near the property, not having time to manage the property because of a full-time job, not having the resources to find and retain tenants, or simply having no interest in the hands-on management of a building.
Although it may be difficult to put your business in someone else’s hands, it may prove to be a cost-efficient expense that will help your investment maximize ROI. At the end of the day, it’s important to think of your rental property as a business — and a good property management company will manage your property like a business since it is their business! Here are some important things to think about when considering a property manager.
How much are you going to pay for property management?
Depending on your location, property management companies will charge between 4 and 12% of the gross monthly rent in management fees. It is also important to understand what is included in that fee. Ask your property manager to give you a scope of services document so you can clearly understand what is included in the management fee and what they will be responsible for.
How does a property manager handle rent collection?
Ask your prospective property manager about how they handle rent collection. One of the most important tasks of a property manager is to efficiently collect and record rental income. A good property management company should have ACH withdrawal systems set up to pull rent on the first of every month and a full-time accountant to make sure funds are properly recorded.
Maintenance requests and tenant communication A professional property management company will have a tenant portal and a clear process for taking and recording maintenance issues and requests. If a tenant is not able to communicate issues with the property manager, it can result in upset tenants along with deferred maintenance issues, and even city fines.
Do they have a list of established vendors for building maintenance? Property management companies are large sources of business for contractors and vendors in the real estate sector. This means the property manager you hire should have developed relationships with contractors and vendors — and more importantly, they should be able to pass the bulk discounts along to you! Be sure to ask about how the property manager can save you money.
These are very important items to ask and consider when hiring a property manager. It is equally important to have a conversation with a potential manager to see if it will be a good fit on both ends. If you would like to interview MerGo Property Management Click the link Here.
There are many types of insurance that people get to properly manage risks associated with living. Auto insurance, home owner’s insurance, health insurance, and life insurance are a few common types of insurance. But what if you’re renting a home or an apartment? Renters insurance is a perfect way to protect your personal belongings.
So, what are the main benefits of renters insurance?
1. Renters insurance protects your belongings
The main purpose of renters insurance is to safeguard your belongings in case of fire, theft, loss, or damage. In the event that something does happen to your personal belongings, renters insurance will reimburse you for that loss. Generally, the policy will have a maximum amount they can pay out on a particular item. Check with your insurance broker for a detailed policy coverage breakdown to ensure you are fully covered.
2. It’s not crazy expensive
Seriously, it’s one of the cheapest insurance policies out there. Renters insurance typically comes out to between $150 an $200 for the year but can be as low as $90 per year for the most basic coverage. (That’s $7.50 per month!)
3. You can transfer it if you move
If you move while your policy is still valid, you are able to transfer it over to your new address. Plus, your belongings will be covered for the move! Just be aware that your rates may change slightly when you move, due to being in a different location.
4. Most policies will cover computers!
This means if your screen dies or you need to replace that $1500 computer, you should be covered. Just check your policy or talk to your insurance agent to make sure this is included.
Renter’s insurance may seem like an additional cost, but it can (and likely will) save you money in the long run. If something were to happen to your belongings and you did not have any coverage, it would end up costing you more. And while we just explained how renters insurance will generally cover your belongings from theft, damage, and loss — depending on your policy, it can cover more even more. (Even things that happen outside of your house!)
Our advice? Ask your auto insurance carrier to give you a quote with a coverage breakdown. We recommend Titan Insurance. Titan is an independent insurance brokerage located on Boylston St in Boston, and they provide great service and competitive pricing. You can visit them at www.titaninsured.com
The City of Cambridge is certainly well-known. Home to Harvard University and Massachusetts Institute of Technology, this education and technology hub is also a fun and lively city that has a lot to offer to residents and tourists. Central Square, Kendall Square, and Harvard Square are just a few of Cambridge’s main neighborhoods located off the Red Line.
Inman Square is one of the most unique neighborhoods in Cambridge. Bordering Somerville, this neighborhood is just a few minutes from Union Square and ten minutes from Harvard Square.
With its low-key atmosphere, this neighborhood offers plenty of things to do and has the best of both worlds. There are plenty of restaurants to choose from — Olé, Wit’s End, and Puritan & Company are some of our favorites — while still being close the hustle and bustle of other Cambridge neighborhoods. Located on the MBTA bus route, Inman Square also has access to the Greater Boston Area. And for fitness folks, Inman Square has The Cambridge YMCA, Boston Sports Club, and Art & Soul Yoga nearby!
Inman Square is by far one of Cambridge’s most underappreciated areas, but if you’re looking for a new place in the Greater Boston Area, you might want to consider moving there. MerGo Manages 4 buildings in the square and we are expecting to have more rental units available. Give us a ring for more info!
“My apartment building doesn’t have amenities. What do I do!?”
This is a common question for many people who live in a building that don’t have amenities such as a gym, laundry services, or parking. The good news is there are plenty of services that will give you the same amenities of a full-service building but at a lower cost.
In our experience, the immense cost savings of living in a non-full-service building greatly outweigh the cost of a gym membership and laundry service. In fact, research shows that a building with amenities will be between 20-30% more than a comperable building without amenities.
Laundry options
In the Greater Boston Area, there are plenty of laundromats. But what if you don’t have time to sit at a laundromat and do your laundry? Well, laundry services such as “Life Without Laundry” and “Dependable Cleaners” will pick your laundry up, service it, then deliver it to you the next day. These wash/fold services are generally less than $30 for two weeks worth of laundry.
Gyms and health clubs
One of the benefits of living in and near a city is that there are plenty of options for health clubs. Healthworks, Boston Sports Club, Equinox and Planet Fitness are a few health clubs that offer monthly memberships and are located throughout the Greater Boston Area. There are also more boutique options such as Barry’s Bootcamp, Orangetheory, Barre, Flywheel and Title Boxing that offer specialized classes and memberships.
Not able to commit to one health club? ClassPass is a great option that gives you credits to try out different gyms across the city — even across the United States. Even though these memberships are expensive, the cost savings of not living in a full-service building will almost always outweigh the cost.
The bottom line
You will save between 20-30% by living in a building that does not classify itself as “full service.” These cost savings can be huge when living in one of the most expensive cities in the United States!
With years of multifamily property management experience under our belt, we’ve seen the lucrative returns it can bring for property owners. And while the vast majority of our multifamily property management clients are pulling in impressive numbers, a select few are pulling in incredible numbers.
Why? Because they’ve figured out how to utilize every inch of their building—both literally and figuratively. So, whether you’re a first-time multifamily property owner or you’ve been doing it for years, here are our best tips to help get the maximum return on your investment in the Greater Boston area (or anywhere else).
Multifamily property management can be tricky. Let us help!
Consult a multifamily property management specialist
The simplest way to know you’re getting the most return on your investment is to get your rental pricing dialed-in from the beginning. Most people who venture into multifamily properties without consulting an expert end up pricing their rent far too low. Especially in the Boston area, rents are always fluctuating and you need to make sure your pricing reflects that.
Local real estate professionals are well-versed in the current market rates for multifamily properties, and they can help you get the absolute maximum rates for your building. It’s a no-brainer.
Opt for separately metered utilities
By separately metering your building’s utilities, you can have your tenants pay their own utilities. This lowers your expenses and makes your revenue stream much more predictable. And if you think paid utilities can make a big difference in your appeal to prospective tenants, you might want to think again. In our experience, the difference is negligible—our clients who opt for separately metered utilities have no problems finding tenants, and they always make more money in the end.
Start your leases in June or September
Around 65% of all lease cycles in the Greater Boston area turn over on September 1st, and of that remaining 35%, most turn over on June 1st. Your building’s location usually determines which date is best, so you’ll want to consult with your local real estate professional to decide which one is best for you.
But the lesson here is simple: if your lease isn’t turning over on one of those dates, you’re missing out on a whole lot of demand. More demand means you can charge more and you’ll be guaranteed to fill your building on each lease cycle.
Coin-op laundry and multifamily property management go hand-in-hand
If you own a multifamily building, coin-op laundry can provide a nice incentive for prospective tenants and a boost to your returns. We often find that units with coin-op laundry get rented faster than those without.
Our pro tip? Find a company (like Maytag, CoinMax, or others) who will lease the equipment to you, install it, and handle all repairs. These companies often have no up-front costs, and instead, opt for a monthly fee or a split of the proceeds. AKA, you’ll never have to think about those machines.
Provide rental storage
If you have extra space in your building, consider converting it into storage space for your tenants. In crowded city areas like downtown Boston, tenants are often unable to fit all of their belongings in their apartments—so extra storage is a welcome addition. In our experience, property owners can charge up to $75+ more per month by offering storage space for their tenants.
Take advantage of parking spaces
Parking spaces might just be the most sought-after pieces of land in any city, and Boston is no exception. Here’s why we love parking spots:
• They require no maintenance. • You can charge shockingly-high monthly rates for them. • They’re always in demand. • If your tenants don’t want them, you can rent them to other people in the area, or a company like Zipcar. • They can be a huge incentive for prospective tenants.
Depending on your location, a single parking spot can fetch upwards of $300 per month. Honestly, if you wanted to skip the properties altogether and invest solely in parking spots, it wouldn’t be the worst idea.
Use the 3% rule
Standard practice in a busy area like Boston is to raise your rent by 3% every year to account for inflation, higher cost of living, and increased demand. If you’re not already doing this, you really should be. It might not improve your returns by all that much, but it will always prevent you from losing money.
