Another Notice for Rent Controlled Properties in Los Angeles

December 22nd, 2009

Author: Scott Goodman • www.scenicwestpm.com

Another proclamation has come down from the high priesthood called the Los Angeles Housing Department (LAHD).  The notice concerns those buildings built before 1978, commonly referred to as “rent controlled” buildings. Not surprisingly, the notice is about posting a notice – your tax dollars at work.  More specifically, the notice states that landlords whose buildings are subject to the Los Angeles Rent Stabilization Ordinance (LAHD RSO) must post a notice providing information about said Rent Stabilization Ordinance.  The notice must be posted in a visible location of the property – in the lobby, near a mailbox used by all residents, or in or near a public entrance to the property. LAHD will inspect properties and notify owners who fail to post the notice. Landlords have seven days to comply. One thing is for certain, if you don’t comply, you could be fined $250.00 per day.  Check it out at:

http://lahd.lacity.org/lahdinternet/Portals/0/Rent/RSO%20NOTICE%20(2).pdf

The Importance of Finding Good Tenants In Spite of the Bad Market

December 3rd, 2009

Author: Scott Goodman • Scenic West Property Management

First in a series about tenant screening 

Don’t lower your standards and ignore your better judgment for the sake of a quick rental. I’ve been there and learned my lesson.  If the tenant looks bad on paper, just wait until they are living under your roof. A good property manager should have a written set of criteria which every prospective tenant must meet in order to live in one of your units.

The rental market is soft, there’s a lot of competition out there. Landlords are seeing one vacancy after another and feel the pressure to fill vacancies quickly. Many landlords have become less diligent in screening prospective tenants. After all, an occupied apartment is better than an empty one, right? Wrong.

Unfortunately, this non-vetting can lead to larger issues with problem tenants. Let’s fast-forward six months from now. Your tenant, who wasn’t properly screened, has stopped paying rent and now you have an eviction in your hands. It’s a double whammy – another vacancy AND an eviction. You would have been better off properly screening your prospective tenants and renting to a good tenant.

Only an apartment occupied by a GOOD tenant is better than a vacant unit. To avoid problem tenants, it is important to carefully assess your candidates. This might mean that you will have to suffer along the way and have an unoccupied period, but it could save you costly expenses later on. Remember, the time you spend up front carefully screening your applicants will save you a lot of time, money, and headache when compared to renting to a deadbeat tenant that defaults on rent, trashes your rental property, or worse yet, scares away your other tenants.

As a footnote, always use fair and consistent parameters for screening your prospective tenants. More about this topic coming soon.

Periodic maintenance… periodic inspection of the premises

November 17th, 2009

Author: Scott Goodman • www.scenicwestpm.com

Hoarders and packrats – every building has one or two to a varying degree.  Unfortunately, even the most thorough tenant background screening may miss such things as untidiness. Tenants can inflict a lot of damage to a unit when they set their minds to it.  The trick is to spot the problems early on and take prescriptive measures to limit the damage. But given the fact that most landlords only perform two inspections – once at move-in and then the final inspection at move-out – how do you gain access to a tenant’s unit when you suspect something has gone astray?

I recently had a tenant who turned out to be a hoarder with garbage and belongings covering every square foot of available floor space in his unit.  I could see through the windows that something terrible was going on, but how could I prove it when this tenant always demanded formal notice to gain admittance to his unit? Although a standard lease agreement does provide for such things as landlord inspection of the premises, such scrutiny may put tenants at odds.

This is where periodic maintenance of such things as AC filter changes, smoke detector testing, and the occasional plumbing leak can be an invaluable resource.  Never miss an opportunity to perform a general evaluation of the premises when called upon to perform routine maintenance for the unit.   In the case of our hoarder, a quick check of our records indicated that his smoke detectors were almost due for their periodic inspection. So we moved up the date a little and served the tenant a Notice to Enter the Premises for the purpose of testing the smoke detectors. Just as we suspected, we could not even get to the bedroom to check the smoke detector because there was so much garbage blocking our way.  A 3-Day Notice to Perform or Quit was served and as luck would have it the tenant has complied for the time being by cleaning up his unit.  Keep to a periodic maintenance schedule and you will find that it gives you the opportunity to fix more than just the leaks.

A word about coin op laundry machine contracts

October 27th, 2009

 

coin operated washing machine

High efficiency coin operated washing machines

Author: Scott Goodman www.scenicwestpm.com

 

Are you using coin operated laundry machines in your rental properties? If so, it is a good idea to review your laundry room lease contract from time to time. 

The lease is structured so that you, the property owner, are the lessor and the laundry service company (LSC) is the  lessee; ie, you will be leasing space in your building (the laundry room) for the LSC to place their machines. This is an extremely competitive industry, and if you are well-informed you can negotiate very favorable terms for yourself.

At the very least, make a note to yourself of the expiration date of the lease, as I have seen some lease proposals that last 7 years. Furthermore, many contracts include an automatic term renewal clause which could have you kicking yourself after you hear the next thing I have to say. Historically, LSCs like Coinmach and Web split laundry income 50/50 with owners.  That’s not the way it is nowadays.  There are signing bonuses, 60/40 income splits in favor of the owner, laundry room improvements and machine upgrades to be had for the asking. Some of the machine upgrades can pay for themselves with so called “going green” rebates from third parties like the DWP.  That is the case if you decide to go with high-efficiency machines (HE machines). Some of these rebates have gone as high as several hundred dollars per washing machine for the water they expect to save over the lifetime of the machine. 

So pay attention and don’t miss out on this simple opportunity to improve your bottom line.  At the very least you will increase your laundry income; or you may even get a laundry room remodel out of it. And while you are at it, cross out that clause regarding the automatic renewal of your laundry room lease contract.

Welcome!

October 26th, 2009

Welcome to the Landlord Report, the go-to site for residential property managers, landlords, and  real estate investors. Here, you can get information and updates on rental property management, capital improvements, landlord/tenant relations, and investment property mortgage data. 

Well-informed landlords and investors have better tenant retention, control their property management cost, and increase their bottom-line.