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Author: MerGo Group

When to Hire a Property Manager

Written by MerGo Group on . Posted in Property Management Insights, Uncategorized. No Comments on When to Hire a Property Manager

Hiring a property manager can be a beneficial decision for real estate investors or property owners who find themselves overwhelmed with the responsibilities of managing their properties. Here are some situations when you might consider hiring a property manager:

  1. Limited Time or Availability:
    • If you have a busy schedule or live far away from your rental property, a property manager can handle day-to-day tasks, saving you time and travel. The low cost of a property management company is tax deductible and will free up your time to do more of what you love – spend it with your friends, family, traveling, or just not being bothered by issues when they arise.
  2. Multiple Properties:
    • Managing multiple properties can become challenging. A property manager can efficiently handle the demands of multiple units, ensuring that each property receives proper attention. They have the tools setup to manage work orders, tenant lease ledgers, documents, and other necessary items and issues.
  3. Lack of Expertise:
    • If you’re not familiar with property management laws, tenant-landlord regulations, or property maintenance, hiring a professional can help you navigate these complexities and avoid legal issues. Massachusetts has very strict landlord-tenant laws and they vary by town/city which makes it more difficult to know each one but more important to hire someone who works in those dedicated areas.
  4. Tenant Issues:
    • If dealing with tenant-related matters, such as screening, leasing, and handling disputes, becomes burdensome, a property manager with experience in tenant management can be invaluable. It’s important to know what to say and how to communicate with tenants so that you are not crossing any boundaries or risking any legal issues. What you might think isn’t a big deal could actually be illegal.
  5. Property Maintenance Challenges:
    • If you’re not equipped to handle maintenance requests, repairs, and emergencies, a property manager can coordinate and oversee these tasks, ensuring the property is well-maintained. A good property management company will have trusted and vetted vendors as well as in-house technicians. In the current business environment, finding good vendors who will schedule, show up, and charge appropriately is becoming increasingly difficult. Many are not taking on more clients, and if they do, they will schedule a month out, which is not beneficial for you, the property, or your residents.
  6. Desire for Passive Income:
    • If your goal is to generate passive income and you don’t want the hands-on involvement of day-to-day management, a property manager can take care of the operational aspects for you.
  7. Legal Compliance Concerns:
    • Property managers are often well-versed in local, state, and federal laws related to property management. If you’re concerned about compliance, hiring a professional can mitigate legal risks.
  8. Financial Management:
    • Property managers can handle rent collection, financial reporting, and budgeting, ensuring that your investment remains financially sound.
  9. Scale and Growth:
    • As your real estate portfolio grows, managing properties becomes more complex. A property manager can help you scale your operations efficiently.
  10. Stress Reduction:
    • If the stress and pressure of managing a property are impacting your well-being, hiring a property manager can provide peace of mind and allow you to focus on other aspects of your life or business.

Before hiring a property manager, it’s essential to carefully consider your specific needs, budget constraints, and the qualifications of potential candidates or management companies. Additionally, thoroughly research and interview candidates to ensure they align with your goals and expectations for the property. A good property management company should provide clear communication, have systems setup for tenant and work order management, rent collection, and monthly owner statements. You should confirm what fees they charge – both advertised and hidden (such as charging a percent ontop of vendor bills, charging for scheduling, lease creation, etc). Find a company that is aligned with your financial goals who charge monthly management fees as a percent of rent and not charge fees ontop of vendor bills, for scheduling, leasing, or renewals to name a few.

Becoming a First Time Landlord

Written by MerGo Group on . Posted in Property Management Insights. No Comments on Becoming a First Time Landlord

Becoming a first-time landlord can be a rewarding but challenging venture. Here are some key steps and considerations to help you get started:

  1. Educate Yourself:
    • Familiarize yourself with landlord-tenant laws in your area. Each jurisdiction has its own rules, and it’s crucial to understand your rights and responsibilities.
    • Learn about fair housing laws to ensure you don’t discriminate against potential tenants.
  2. Financial Planning:
    • Assess the cost of ownership and see if the rent can cover those costs and leave room for anything unexpected as well as making a profit.
    • Costs include mortgage payments, property taxes, insurance, maintenance repairs, landscaping, snow removal, utilities that you would pay for (water/sewer usually), and vacancy if the unit isn’t rented during the transition.
    • Set aside funds for any other unexpected expenses (roof, appliances, windows, etc).
  3. Property Selection:
    • Choose a property in a desirable location. Consider factors such as proximity to public transportation, schools, and amenities.
    • Evaluate the property’s condition and any necessary repairs or renovations.
  4. Legal Formalities:
    • Draft a comprehensive lease agreement that outlines terms and conditions, rent amount, payment due dates, and other important details. Make sure to use a proper legal lease that will uphold in court.
    • Screen potential tenants carefully. This includes checking references, credit history, income, and conducting background and internet checks.
  5. Understand Your Responsibilities:
    • Be prepared to handle maintenance and repair issues promptly. A well-maintained property attracts and retains good tenants. It also reduces tenant issues, rent withholding, and other legal liabilities.
    • Stay informed about local building codes and safety regulations.
  6. Set the Right Rent:
    • Research rental prices in your area to determine a competitive rent for your property.
    • Consider factors like property size, amenities, and location when setting the rent.
  7. Insurance:
    • Obtain landlord insurance to protect your property from potential damages and liabilities. Regular homeowner’s insurance does not cover rental activities and if anything happens when a renter is living there then your insurance will not cover it if you do not have the correct comprehensive policy.
  8. Create a System for Rent Collection:
    • Establish a clear and consistent method for rent collection, whether it’s through checks, electronic transfers, or online platforms.
  9. Emergency Fund:
    • Build and maintain an emergency fund to cover unexpected expenses like repairs, maintenance, or periods of vacancy.
  10. Communication:
    • Maintain open and clear communication with your tenants. Respond to their concerns and requests in a timely manner. Be kind, professionally, understanding at all times without having to give into every demand.
  11. Networking:
    • Connect with other landlords, join local landlord associations, or attend real estate networking events to learn from experienced landlords and stay updated on industry trends.
  12. Tax Implications:
    • Understand the tax implications of being a landlord. Keep accurate records of income and expenses for tax reporting.

Remember, being a landlord requires ongoing commitment and responsibility. Staying informed, being proactive, and treating your tenants fairly can contribute to a successful and rewarding experience. If needed, consult with legal and financial professionals or a property manager for advice tailored to your specific situation.

How to Send a Lease Non-Renewal Notice

Written by MerGo Group on . Posted in Property Management Insights. No Comments on How to Send a Lease Non-Renewal Notice

Sending a non-renewal notice to a tenant is a formal process that must comply with local laws and the terms of the existing lease agreement. Here’s a general guide on how to send a non-renewal notice:

  1. Review Lease Agreement:
    • Thoroughly review the existing lease agreement to understand the terms and conditions related to lease termination and non-renewal. Make sure you are within your legal rights to issue a non-renewal notice.
  2. Check Local Laws:
    • Familiarize yourself with local and state laws regarding lease termination and non-renewal. Different jurisdictions may have specific requirements, such as the notice period and the information that must be included in the notice and/or provided to the municipality.
  3. Decide on Non-Renewal:
    • Most likely you are not obligated to give a reason to not renew the lease. If the lease has a termination date it’s best to say that a renewal will not be offered and the tenants must move out in accordance with their lease end date.
  4. Prepare the Non-Renewal Notice:
    • Draft a formal non-renewal notice. Include the following information:
      • Tenant’s name and address
      • Property address
      • Date of the notice
      • Statement indicating that the lease will not be renewed
      • Reason for non-renewal (if required by local laws)
      • Any specific actions required by the tenant, such as moving out by a certain date
      • Contact information for further clarification or questions
  5. Provide Adequate Notice:
    • Ensure that you provide the tenant with the required notice period as per the lease agreement and local laws. Common notice periods are typically 30 or 60 days before the end of the lease term. You could provide longer so the tenants have time to find a new living situation and you have time to find a replacement tenant.
  6. Deliver the Notice:
    • Choose an appropriate method to deliver the notice. Common methods include delivering it in person, sending it via certified mail with return receipt requested, or delivering it through an electronic method if agreed upon in the lease.
  7. Retain Documentation:
    • Keep a copy of the non-renewal notice and any proof of delivery. Documentation is crucial in case there are disputes or legal issues in the future.
  8. Follow Up:
    • Follow up with the tenant to ensure they received the notice and understand the terms. Be available to address any questions or concerns they may have. Afterall, this might come as a shock to the tenant especially if they feel entitled to or expect a renewal. Best to stay calm and just explain that it didn’t work out but you wish them the best of luck and are happy to help if possible.
  9. Comply with Local Laws and Lease Terms:
    • Ensure that you are following all applicable local laws and the terms outlined in the lease agreement. Non-renewal notices must adhere to legal requirements to be valid.
  10. Plan for Transition:
    • As part of the non-renewal process, consider preparing for the transition, such as inspecting the property, returning any security deposits after move out and no damages or unpaid rent, and arranging for the tenant’s move-out.

Always consult with legal professionals or property management experts to ensure that your non-renewal process is in compliance with local laws and regulations. Laws can vary, so it’s important to be aware of the specific requirements in your jurisdiction. Remember, this is different from a notice to quit or other eviction notices. We are not lawyers and this is not legal advice nor intended to be, but rather a general guide that can help. Always seek a lawyer for legal advice.

How to Properly Handle Tenant Lease Renewals

Written by MerGo Group on . Posted in Uncategorized. No Comments on How to Properly Handle Tenant Lease Renewals

Handling lease renewals is an important aspect of property management, whether you’re a landlord or a property manager. Here are some steps to help you navigate the lease renewal process:

  1. Early Communication:
    • Initiate communication well in advance of the lease expiration date. This gives both parties ample time to discuss and negotiate terms. You want your residents to know what to expect and notifying them early will help them with their planning.
  2. Deciding to Renew or Not
    • A landlord is not obligated to renew a lease to a tenant nor is a tenant entitled to receive a renewal. If you plan to send a non-renewal make sure to check the lease and any local regulations that may require additional forms and steps to be taken. Sending this early can also help the tenant plan for their move.
  3. Assess Current Market Conditions:
    • Research the current rental market to ensure your proposed rent increase or renewal terms align with the current rates in your area.
  4. Review Lease Agreement:
    • Thoroughly review the existing lease agreement to understand its terms, conditions, and any clauses related to renewal. Most leases have a clause when renewals can be sent, make sure yours is at least 180 days in advance to reduce vacancy loss and allow both parties enough time for future plans.
  5. Evaluate Tenant Performance:
    • Assess the tenant’s payment history, property care, and compliance with lease terms as well as the way they interact and communicate about issues. This evaluation can help you decide whether to renew the lease or make adjustments to the terms.
  6. Consider Property Expenses:
    • Each year property and ownernership expenses increase. Rent increases should cover expense increases such as maintenance repairs, real estate taxes and other local property-related taxes, insurance, utilities, tax returns, and more when factoring in the renewal rent.
  7. Determine Renewal Terms:
    • Decide on the renewal terms, including the duration of the new lease, any changes to rent, and any other modifications to the lease agreement.
  8. Communicate Proposed Changes:
    • Clearly communicate any proposed changes in terms, including rent increases or modifications to the lease agreement, to the tenant. Provide a written notice outlining the proposed terms. Do this by sending the renewal offer and the renewal lease at the same time.
  9. Negotiate if Necessary:
    • Be open to negotiation. If the tenant has concerns or requests changes to the proposed terms, be willing to discuss and if it doesn’t work out then be prepared for the tenant to move out.
  10. Execute Renewal Agreement:
    • Both parties should sign the renewal agreement to make it legally binding. Ensure that all necessary parties have a copy of the signed agreement. Have this done within two weeks of sending the initial lease renewal agreement
  11. Plan for the Future:
    • Use the renewal process to plan for the future. Consider whether there are improvements or changes that can be made to enhance the landlord-tenant relationship and property management processes.

Maintaining open and transparent communication with your tenants is key to a successful lease renewal process. Completing your lease renewal season early allows the landlord to rest easy when a tenant decides to renew and allows a tenant to rest easy knowing their home is secure for another year. On the other hand, if the tenant does not want to renew – it gives the landlord time to find new tenants, and also gives the tenant time to find a new place if a renewal option isn’t offered.

Reach out to MerGo today to see how we can help you with your renewal process and make it easier on you.

How Residents and Managers Can Communicate Professionally

Written by MerGo Group on . Posted in Property Management Insights. No Comments on How Residents and Managers Can Communicate Professionally

Effective and polite communication is crucial in a work environment to foster positive and healthy relationships and ensure efficient collaboration. Here are some tips on how to communicate politely within a work environment with your landlord, property manager, and tenants.

  1. Use Proper Greetings:
    • Start your communication with a polite greeting, such as “Hello,” “Hi,” or “Dear [Name].” Tailor your greeting based on the formality of the communication and the relationship.
  2. Be Mindful of Tone:
    • Pay attention to the tone of your communication. Avoid using aggressive or confrontational language. Choose words that convey your message clearly without being offensive. When sending an email, if the tone is rude, it can be read as rude which doesn’t make people willing to help out the issue any faster. The old saying you get more flies with honey” is true. If you want something done soon, being nice will make that happen versus using threatening or rude words and tone.
  3. Choose Appropriate Language:
    • Use professional and appropriate language in all communications. Avoid slang or overly casual language, especially in written communication. Avoid using rude aggressive language, threatening, or otherwise inappropriate.
  4. Be Clear and Concise:
    • Clearly express and detail your issues and what you need. Be concise and to the point to avoid misunderstandings. Use bullet points or numbered lists for complex information to enhance clarity.
  5. Use “Please” and “Thank You”:
    • Incorporate polite expressions like “please” and “thank you” in your requests and acknowledgments. This simple courtesy goes a long way in creating a positive and respectful atmosphere and getting people to listen.
  6. Respect Others’ Time:
    • Be mindful that everyone has a lot going on and that you aren’t the only person that they are working with. If you need time for a meeting or discussion, request it in advance and be punctual. Value their time as much as you value your own. Be understanding that it takes time to resolve issues and that while the issue is being worked on for you, that delays happen and are out of everyone’s control.
  7. Apologize When Necessary:
    • If you make a mistake, send a rude message, or otherwise aren’t nice, promptly acknowledge it and apologize. Taking responsibility for errors demonstrates accountability and professionalism.
  8. Show Empathy:
    • Acknowledge and show empathy towards the feelings and perspectives of others. This helps build positive relationships and fosters a supportive work environment.

By incorporating these communication practices into your interactions with both the tenants and managers, you contribute to a positive and respectful atmosphere, promoting and building strong professional relationships which is what exists between a tenant and manager.

How Residents and Managers Can Retain a Good Relationship

Written by MerGo Group on . Posted in Property Management Insights. No Comments on How Residents and Managers Can Retain a Good Relationship

Tenants and property managers work to maintain a professional and respectful relationship to ensure a positive living experience for everyone involved. Here are some tips on how tenants and managers should treat each other to work cohesively.

  1. Communication:
    • Keep open and clear communication channels. Tenants should report any maintenance or other issues promptly, and notify their managers of any changes in your contact information.
    • Communicate politely and professionally, whether it’s in person, over the phone, or in writing; as this is a professional work setting environment and relationship.
  2. Respect Property Rules:
    • Familiarize yourself with the property rules and regulations. Abide by them to maintain a harmonious living environment for all residents. Managers are hired by landlords to follow and enforce the lease and property rules and laws that tenants are required to follow.
  3. Pay Rent On Time:
    • Pay your rent on time as per the terms of your lease agreement. Timely payments contribute to a positive relationship with your property manager and landlord.
  4. Maintenance Requests:
    • Submit maintenance requests through the appropriate channels provided by your property manager. Clearly describe the issue and provide any necessary details to help them address the problem efficiently. The goal of the management team is to fix the problem quickly and correctly.
  5. Keep the Property Clean and Well-Maintained:
    • Take care of the property as if it were your own. Keep it clean, report any damage promptly, and follow any guidelines for maintaining the property. Landlords and managers value residents who value their property and the better maintained a unit the longer the relationship can last usually with lower rent increases making all parties happy.
  6. Follow Lease Terms:
    • Adhere to the terms outlined in your lease agreement. This includes respecting noise levels, parking regulations, and any other stipulations set forth by the property management and landlord. The management company is required to follow the lease terms and enforce them as much as the tenant is required the same. Landlords hire management companies to enforce the lease.
  7. Be Courteous:
    • Treat property management staff with courtesy and respect. They are there to help and ensure the smooth operation of the property in return the manager will always treat the residents with respect and courtesy. One of the biggest things to remember is that managers are there to fix problems, not create them, and while problems arise that are unanticipated the team works hard to resolve them quickly and correctly. Although most people don’t understand, the team does empathize and sympathize with issues that arise as they too have lived through similar issues and problems.
  8. Notify in Advance:
    • If you plan to move out or have any changes in your circumstances that might affect your tenancy, provide advance notice to your property manager. This allows them to plan accordingly.
  9. Understand Their Role:
    • Recognize that property managers have responsibilities and tasks that go beyond individual tenant concerns. Be patient and understanding if they are dealing with multiple issues simultaneously.
  10. Feedback:
    • If you have feedback, positive or negative, communicate it constructively. Providing feedback helps property managers understand tenant needs and improve their services.

Remember, a positive and cooperative relationship between tenants and property managers is beneficial for both parties. By treating your property manager with respect and fulfilling your responsibilities as a tenant, you contribute to a positive living environment and make the overall experience better for everyone involved.