- How Much Money Is Needed To Invest In Rental Property?
- Should A Real Estate Investor Get An Agent’s License?
- 5 Big Factors That Affect The Costs Of Renovating Your Home
- SIBOR Hike – What You Can Do With Your Current Loan
- 6 Basic Don’ts Of Real Estate Negotiation Tactics
- Will New Condo Relaunches Trigger The Great Property Sale We Have All Been Waiting For?
- 10 Proximity Amenities That Add Value To Real Estate
- How To Get Personal Loans More Easily With Good Credit
Steps To Take When Tenants Decide Not To Renew And Leave
When tenants decide to move out of your property, it can be a disappointment when they are good tenants. No matter if you support the non-renewal or not, you have to move fast so that you minimize the opportunity costs from vacancies.
The first thing you have to do when it is a conclusion that you current tenants will not be renewing their lease, is to start prospecting for new tenants. Keep in mind of the agreed date which the property will be handed over back to you. You can then start sending out an email blast to previous clients or your waiting list. Or if you are lazy, just get your trusty real estate agent to start working.
You can start scheduling viewings even before the current tenants leave. You will of course give reasonable prior notice and only schedule viewings within hours that will not cause significant inconvenience.
During the handover, remember to bring along the furniture and fittings checklist which was used when you first rented it out to the outgoing tenant. Go through each item to ensure that they are still physically there and are in reasonable working condition. Things can wear and tear. So it is not reasonable to expect your fixtures or electronics in top condition.
When major damages are discovered, write it down and get the tenant to acknowledge it in writing. Get them to sign if necessary. On occasions when the outgoing tenant is actually not around, get their representative to acknowledge it by taking photographs. The photographs should contain the damage, the representative, and preferably a copy of the day’s newspapers in the background. This is to make sure that the tenant can see his representative observing the damage and the date stamp when it was observed. This action will eliminate any arguments of whether any damages were done after the inspection. Some landlords might think that this is over-the-top behavior. But I assure you, you will be glad you have these photographs as evidence should the tenant challenge your findings of major damages.
There are times when tenants have already left and did not appoint a representative for inspection. In these cases, usually the tenant does not really care about their security deposit anymore. They are ready for you to recover losses from damages via the security deposit. Be fair and return the balance of the deposit after deducting for damages to the tenant. If you are totally meticulous, retain the receipts of the repairs you have made and make a copy for the tenant. After which you will send the deposit balance with the receipts to the tenant. He will appreciate this even if he no longer cares about the deposit. Who knows. Tenants who have moved out may become your clients again some day. And they might have referrals to send you in future.
Now that the inspection is done and dusted, you have to obtain the new contact information of the outgoing tenant. This is so that you can forward their mails to the new address. You are going to need these information as well when you return the initial security deposit. An important point to note is to get the tenant to acknowledge that he has received the money. The best form of acknowledgement is a signature. But with technology these days, you can probably make do with an email reply, phone message, or fax.
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Remember that by right, the outgoing tenant has to return you the property in the same condition you rented it out in the first place. It depends on you how much you are going to enforce that. But if you incur huge costs to rectify your house, charge it to the tenant reasonably.
Another important action to take is to record down the utility meter reading. Because when a new tenant moves in, he will probably move in at a date within the billing date of the next utility bill. So the tenant may argue how much of the bill he has to foot. With a reading meter that has been acknowledged by the new tenant, you will be able to avoid this dispute and segregate the portion each party has to pay accordingly.