Fort Worth Apartment Tips-Rent out, don`t Sell out!
Just as the rest of the country Fort Worth has the real estate slowdown, so now is not the best time to sell your apartment, condo, or townhome.
This is a grate article that talks about this topic. Read and have fun
"For rent" is a sign of the times for house and condo owners who need to move and can't sell. Don't become a landlord without doing your homework.
Can't sell? Quick advice for rookie landlords
November 11, 2009
BY KAY SEVERINSEN
These are strange economic times. Homeowners who once expected to sell at a profit are suddenly realizing they have two choices -- sell at a loss or rent out their property. In just the past year alone, industry experts say the number of those who choose the latter has at least doubled.
Two rental agencies, Chicago Apartment Finders and Homescout Realty, both are seeing a lot more rookie landlords who are hoping to weather the downturn by renting out their homes. Michael Krasman, managing broker and co-founder of Homescout, estimates there are at least twice as many as there were a year ago.
Rookie landlords have their own set of problems. A large majority fails to prepare their properties for showings, and many of them set rents too high.
Here is a primer on how to avoid common beginners' mistakes from Chicago Apartment Finders and Homescout:
Make it move-in ready
Justin Elliott, of Chicago Apartment Finders, said a huge number of properties are not freshened up and ready for a new tenant. Both he and Krasman estimated that up to three-quarters of the properties they are asked to list are not presentable when they first see them.
"You should walk around your apartment and ask yourself, if you were a renter, would you want to live here?" said Elliott. "It should be clean, well lit, smell good, the carpet should have been shampooed, the corridors should be clean and the foyer shouldn't have newspapers all over."
"To remove your chance of having any tenants," he said, "just have the place not in a condition to show. I'm not talking about substantial renovation, but just a cleaning crew and paint."
Potential tenants, they said, pick up on sensory cues; does it smell clean and fresh or does it smell like pet urine? Is it visually appealing - are the lights on, or is the place dark and dingy?
Both Krasman and Elliott said that their agents work with landlords to help them see their properties through the eyes of a tenant and get ready for renting.
"Kitchens and bathrooms are the two critical things that help sell a tenant on a place," he said. "If you have a really old kitchen, putting in newer appliances and granite will immediately improve the way a property shows."
Consider upgrading lighting fixtures, and replacing an older bathroom sink with a pedestal sink. Replace cupboard hardware with new knobs for a quick update.
Elliott also pointed out that everything should be in good repair. Burned out light fixtures and leaky faucets absolutely should be repaired before showing a unit.
He also noted that the temperature inside the property should be comfortable, especially in summer months. The prospective landlord should be sure the air conditioning is working and is turned on if the weather is hot, and that the heat is on during cold months.
"If people walk into a stuffy apartment," he said, "they don't want to rent."
Staging
Giving prospects a visual understanding of the space is crucial.
"For renters, one of the most difficult things is to imagine how their furniture will fit," Elliott said.
Both he and Krasman recommend that if the property is empty and the budget will allow, the landlord should rent furniture to make sure the unit is well staged. That could cost a couple hundred dollars a month, but if the apartment rents a month sooner, the money is well spent.
Alternatively, Elliott suggested, the landlord should take a lot of photos of the apartment when it is furnished and not only include them with their internet advertising, but display them in the home for walk-ins to see.
"They can't be average pictures," he added. "The rooms must be well lit. Make sure everything's clean, turn the lights on. If people see pictures they will ask to see the unit."
Pricing correctly
This is a sensitive issue for rookie landlords, but it is essential if the property is going to get rented.
"This is probably the number one most important thing and it is the biggest mistake by far," said Krasman. "The landlord thinks the property is worth more than it is. They are looking at their monthly costs, and if they lower the rent below their mortgage they see it as cash out of their pocket."
Both rental services say that one of the big advantages of using their services is that they are well versed in up-to-the-minute comparable listings within micro-neighborhoods.
"We can pull relevant comps updated to the very day, not just in that neighborhood but down to a four block area," Krasman said.
Lowering your price to meet actual market expectations can pay off in the long run, added Elliott. "Some people will say, 'I need $2,200 to cover my mortgage,' but it won't rent unless it's $1,800 or $1,900. It's painful to be upside down, but that's much better than being empty for three to four months. People should ride out the storm and get some of the benefits."
Krasman noted that there are also some tax advantages to being a landlord, and an accountant can explain how being upside down on income/outgo can be less painful at tax time.
Accessibility
The more traffic through your property, the faster it will lease. That seems like a no-brainer, but oftentimes, beginning landlords don't make their property available. They're at work, or they're busy.
That's where property leasing companies can come in handy. Home-scout keeps coded property keys so that they can always get into a property. Apartment Finders makes sure that their landlords offer guaranteed access.
"Renters don't put much time into finding an apartment," Elliott said. "They'll say, 'I have three hours.' If there is a unit they can't get into, they rent something else."
If you are doing this on your own, you'll have to check voicemail and email constantly, and be prepared to offer immediate accessibility seven days a week, and even as late as 9 p.m. And if you are concerned about bringing strangers into your home, and would like another person there, make sure to have backup assistants at the ready if possible.
Pets
Elliott added that if your property is pet-friendly it will double your traffic. Be sure to list that information in your advertisement.
Both leasing brokerages work primarily in Chicago, with the bulk of their business in the Loop and on the north side. Their business models are similar; each helps renters find an apartment at no charge, and handles background checks and showings. The tenant's first month's rent is paid to the brokerage instead of to the landlord.
The leasing brokers like to think of it as a win-win situation. Tenants pay nothing for the service; landlords pay a month's rent but may save a month's mortgage by finding a tenant faster.
As an example, Homescout worked recently with a newbie landlord who had a one bedroom, one-bath condo in the South Loop. Unlike the properties of many new landlords, hers was ready to show and she had a realistic expectation on the rental amount. She wanted to have regular updates, so she heard every couple of days about activity on her condo, and had it rented out in 10 days for $1,495 a month.
If you have a similar situation and you live in the Dallas Fort Worth Metroplex, contact your local apartment locator both if you need to rent out your apartment or condo and if you need to find renters.
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