Many times landlord-tenant communication fails because landlords have so many other pressing issues to handle on a daily basis. Unfortunately, these landlords haven’t yet realized that improved landlord-tenant communication can actually shorten their daily to-do lists and ultimately, help protect their investment. Good communication shouldn’t end the moment you hand over the keys to a new tenant. In reality, this is the time when good landlord-tenant communication should begin.

Consider the following three ways that landlord-tenant communication can help protect your investment:

1. Avoid Unnecessary Maintenance Service Calls

Good landlord-tenant communication encourages tenants to deal with minor issues on their own. This not only saves you the cost and hassle of scheduling unnecessary maintenance service calls, it also helps protect your rental property. When tenants feel like valued members of your rental community, they’re more apt to change a smoke detector battery or furnace filter themselves, rather than contact you or ignore the issue altogether. Offer a reimbursement with proof of a receipt and old batter or filter.

2. Tenants Keep You in the Loop

All tenants are expected to pay their rent on time, but as every landlord already knows, this doesn’t always happen. When you establish a level of trust and respect with your tenants, they’re more likely to keep you in the loop if they cannot pay their rent on time. When you lack effective landlord-tenant communication, it is often more frustrating to be kept in the dark than to receive a late rental payment. Good communication helps you avoid the frustration of excessive tenant turnover and unnecessary eviction costs.

3. Serious Issues Can Be Addressed Sooner

Tenants have a desire to be heard. When tenants perceive your business relationship as more of a partnership than a dictatorship (with you as the dictator), they feel more invested in their rental community. These tenants are more likely to pick up the phone and call you if something isn’t quite right, rather than ignore the problem until it becomes serious.

For example, if you have an on-site laundry facility and one of the washing machines begins to malfunction, there are two different scenarios that could play out:

1. You are not notified about the problem right away because your tenants assume someone else will deal with it. In the meantime, they simply use a different machine or continuing using the broken one until the damage becomes more severe and costly.
2. Tenants call to inform you of the problem as soon as it occurs because they trust that you’ll address it immediately. The problem can be fixed before more costly damage occurs.

Obviously, most landlords would prefer the second scenario, but this will only happen if your tenants feel invested in their rental community enough to pick up the phone and call. When you establish open landlord-tenant communication, your tenants are more willing to contact you immediately when they notice a problem like this.

As a landlord, you undoubtedly hope that your tenants will take care of your property as if it were their own. Although this doesn’t always happen with every tenant, you can increase the odds of it happening by simply opening up the lines of communication. Tenants are much more likely to take care of your rental property during their tenancy if they feel invested in it. When each tenant feels like a valuable member of your rental community, they have reason to take pride in their surroundings and respectfully protect your property.

American Apartment Owners Association | Company Website | At the American Apartment Owners Association (AAOA), our mission is to serve the interests of landlords, real estate brokers, property managers, real estate owners and apartment building owners nationally. Visit www.AAOA.com for more information about membership details!

Understanding the Multifamily Housing Market: What Differentiates Leasing From Other Sales Environments

There was a time that sales managers were more likely to hire a new agent with experience selling something than an employee without any salesmanship experience at all. But, that isn’t necessarily a great approach in the multifamily housing industry.

Leasing Apartments is a Different Platform

Unlike selling a tire to someone stuck on the side of the road with a flat tire, selling an apartment requires a different approach.

Why? Although some home seekers are in desperate circumstances and others are casually shopping for a new place when the current lease expires, the vast majority are looking for an apartment because they need to move.

It’s the difference between optional and necessary, want and must-have, discretionary and fundamental. Unlike that stranded drive, renters must think beyond getting off the interstate – getting out of the current situation compelling them to move – because leasing an apartment requires a long-term commitment. If someone is looking for a temporary apartment because they’ve lost a job or taken a cut in pay, short-term leasing may create more problems down the road since many multifamily communities charge higher rates for shorter terms.

There’s B2B, B2C and Apartment Home Leasing

Selling apartments is in a class of its own when it comes to putting a label on sales strategy development. There are a few metrics that property managers use to measure sales team performance, like closing ratios and conversion rates. But, some metrics don’t work the same as they do in other sectors. For example, high closing ratios can signal rate tiers are too low and your revenue stream may be suffering.

Another unique component that multifamily management teams face is internal competition within the tenant pool. Essentially, applicants actively compete with current and potential property residents for available units. That’s rare in most B2C environments, although clearly tenants are more closely aligned with consumer labels and business labels.

Sales Team Management Strategies

Designing a strong training program for the property leasing team is critical. Team members need a clear set of goals and objectives to work toward, within a well-defined framework. Without establishing a set of metrics to help you monitor team performance, you probably won’t notice patterns that are keeping you from reaching occupancy and financial goals.

While the overall management plan for multifamily properties is vastly different from almost every other sales related industry, there are some common characteristics every sales agent needs, such as:

• The ability to work with people from diverse backgrounds and educational experiences
• A genuine desire to help all stakeholders
• Authenticity and integrity to bolster consumer confidence
• The gift of gab (rapport building is essential in multifamily sales)
• A level headed approach that is empathetic, but not driven by emotion

How Can You Help Your Team Succeed in a Unique Sales Environment?

1. Recognizing the unique structural differences in apartment home leasing and almost every other sales environment is the first step.
2. Establishing sound measurement protocol that captures a realistic view and unique relationships of the revenue stream, occupancy rates, conversions and closing rates is equally important.
3. Onboarding leasing agents who have industry experience/education or are willing to attend on-going professional development to man your sales desks generally improves outcomes.

There are many other things that differentiate apartment leasing from other retail sectors. Comment below to let us know if you want to hear more about the similarities and differences.

Appfolio | Company Website | LinkedIn Connect | AppFolio, Inc. develops Property Management Software that helps businesses improve their workflow so they save time and make more money. Appfolio submits articles & blogs including topics of Resident Retention, Improved Owner Communication, Time Management, and more.

Performing Incomplete Diligence

This involves buyers essentially cutting the process short due to time or other constraints, according to Occhiogrossi. Other mistakes related to this part of the investment process include performing “inadequate level of due diligence to evaluate existing collateral” and “waiving rights to perform due diligence of vertical components, particularly in portfolio situations.”

“This is ultimately a business risk and investment risk decision,” Occhiogrossi notes.

Assuming a Recently Constructed Building Has No Problems

This is especially true when the market gets revved up and builders rush to complete developments or hire less than qualified workers, often leading to construction defects. Buyer beware.

Going Outside Their Comfort Zone without Proper Advisement

Successful real estate investment rarely happens by accident; it’s about knowledge and experience, both with a particular geographic market and a specific property type. Investors who decide to buy in an unfamiliar market or try their hand at retail when in the past they’ve stuck only with multifamily buildings, without getting some advice from a consultant, may be doing so at their own risk.

Not Calculating Rent Sustainability

“Buyers often overlook the importance of calculating a property’s rent sustainability or the tenants’ ability to maintain rent payment post-closing,” notes Nicholas Coo. “This is particularly important for those properties located in states where tax reassessments on sales are the governing method of tax payment. It is not uncommon to see NNN fees jump by more than $0.75 per sq. ft. due to taxes alone. In some cases, this sticker shock can prove to be too much for tenants to maintain as it equates to thousands of operating expense dollars per month, increased literally overnight.”

Focusing on Short-Term Noise vs. Long Term Signals

Focusing on short-term “noise,” whether it be the daily speculations surrounding Fed policy or daily gyrations in the stock market, as opposed to the underlying factors that actually drive commercial real estate returns such as employment growth, capital flows into commercial real estate and property fundamentals is another common mistake, according to Chris Macke.

Not Building in Proper Deal Contingencies

This may be related to contingencies to address capital needs, lease expirations, possible operational challenges etc., explains Occhiogrossi.

Chasing “Bad” Deals, At All Costs

If the numbers just don’t work, walk away. “Sometimes investors get so married to a deal they will continue to pursue it, knowing it is a true gamble,” Occhiogrossi notes.

Stretching for Yield at the Wrong Point in the Cycle

This happens when “investor sentiment and actions are not aligned,” notes Macke. “On the one hand they ask if the economic recovery is near its end and if pricing has peaked, but then they buy assets in smaller markets that will take longer to recover after the next downturn. One cannot serve two masters and trying to do so results in serving neither well.”

– See more at: http://www.american-apartment-owners-association.org/property-management/landlord-quick-tips/8-common-mistakes-real-estate-investors-make/#sthash.dPwEtqRN.dpuf

American Apartment Owners Association | Company Website | At the American Apartment Owners Association (AAOA), our mission is to serve the interests of landlords, real estate brokers, property managers, real estate owners and apartment building owners nationally. Visit www.AAOA.com for more information about membership details!

Being a landlord may feel like the culmination of a dream, but it can quickly become a nightmare if you end up with bad tenants who know how to work the system. Fortunately, one of the ways you can protect yourself is through a strong rental agreement where everything is enforceable. Too many landlords simply write something up that sounds good, or they buy a generic rental form online or at a local office supply store. That may work fine with good tenants, but what happens when a bad tenant moves in?

Your Rental Agreement Should be Unique

While there are plenty of clauses that can be the same in every rental contract, you want to tailor some of the agreement to be unique to your property. For example, you might have amenities that aren’t listed in a standard contract, or you might offer something that’s different from most of the properties in your area. Don’t ignore those facts in your rental agreement, as that agreement should cover everything to do with the property – including common areas and how they are to be used.

Legality is Extremely Important

Making your agreement unique doesn’t mean ignoring the law. You can certainly add clauses about particular amenities, and take out anything that doesn’t relate to your property, but there are still basics that should be left alone. You and your tenants are both entitled to certain things as part of your business relationship with one another, which is important to remember. Additionally, you want to make sure you understand the law, so you don’t try to put clauses into your rental agreement that aren’t legal. If you do that and your tenant takes you to court, you could end up in a lot of trouble.

An Attorney can Help Protect Your Interests

Paying an attorney might not sound like much fun, but it’s an excellent way for you to make sure you’re protecting your interests as landlord and property owner. Before you start renting apartments to tenants, take your rental agreement to an attorney who deals with property law, and ask for advice. If there are problems with the agreement, an attorney can point them out and help you correct them. It will cost you a little bit to do that, but could save you a lot of money in the long run, because everything in your rental agreement will be legal and enforceable.

Having a strong rental agreement that you can feel good about helps provide you with peace of mind as a landlord. It doesn’t guarantee that you’ll always get good tenants, but it does help ensure that you can take care of any bad tenants quickly and more efficiently. That’s good to know, and can make you more confident in your ability to be a landlord and navigate through anything that comes up with your apartments. Tenants may still try to argue about something in the agreement, but you’ll know that the law is on your side.

American Apartment Owners Association | Company Website | At the American Apartment Owners Association (AAOA), our mission is to serve the interests of landlords, real estate brokers, property managers, real estate owners and apartment building owners nationally. Visit www.AAOA.com for more information about membership details!

Landlording is a tough business, but it can be a moneymaking one, too. If you’re considering renting a home, you can hire a Realtor or property manager to find your tenants–for a fee. The other option is to offer your house for rent by owner.

Legal Compliance

Learn about your state’s, county’s and municipality’s laws before you make a move. A consultation with a real estate lawyer is the best way to make sure you don’t overlook anything. Some of the issues landlords encounter are escrow account management, proper handling of tenants’ security deposits, discrimination avoidance, building codes and zoning regulations. Your attorney can also advise you about the type of–and amount off–insurance you need.

Gather the Paperwork

Professionally written legal documents are an absolute requirement. You can purchase pre-packaged leasing documents from most office-supply stores. Make sure the package you choose is compatible with your state’s laws. Alternately, hire a real estate attorney to write your lease, rental application, eviction notice and a form that allows you or your tenant to request that the lease be terminated.

Get the House Ready

The fresher and cleaner the house looks, the faster it’ll rent and the higher the rent it’ll get. At a minimum, paint each room and repair or replace damaged flooring. In addition, faucets and faucet handles should look new; shades or blinds should be clean, functional and new looking; caulking and grout should be clean and crack-free; and the entire home, including its appliances, should be spotless. Finally, you can head off costly emergency repairs and potential lost rent by getting heating/AC, electrical and plumbing inspections before your tenant moves in.

Figure out the Money

You have to spend money to make money. Your expenses include your mortgage, taxes, insurance, maintenance and repairs and any time the property is vacant (anticipate at least 10-percent vacancy). The rent you charge must be consistent with the local market value. It may not cover all your expenses. Even if it doesn’t, you still stand to profit from tax savings and appreciation of the home’s value.

Handling Repairs

Although you may be able to handle many repairs yourself, you should put together a list of professionals you trust to do work you can’t do or choose not to do. Include plumbers, heating/AC technicians, electricians and general handymen–two or three of each so you can get work done quickly even during busy seasons.

Finding Tenants

Local newspapers and online classifieds such as Craigslist are the most common resources tenants use to find housing. Also consider positing notices on store and employee bulletin boards and, if you’d rent to students, in student unions of local college campuses. If in doubt, run your ads past an attorney to make sure they comply with anti-discrimination laws.

Screening Tenants

There’s no way guarantee you won’t be burned by a tenant, but you can reduce the odds by screening prospects carefully. Check their credit references, especially past landlords. Also, verify employment and income with their employer reference. Credit reports are useful, too, but know that many renters would be buyers if they had the credit and cash to purchase. Unless your property is in a larger city where people frequently choose to rent instead of buy there could be a high probability that your pool of applicants are credit-challenged.

Move-in Inspection

Tour the property with the tenant before you hand over the keys. Make a list of any damage you find so that you’ll know what’s tenant damage and what’s normal wear when the tenant moves out.

American Apartment Owners Association | Company Website | At the American Apartment Owners Association (AAOA), our mission is to serve the interests of landlords, real estate brokers, property managers, real estate owners and apartment building owners nationally.  Visit www.AAOA.com for more information about membership details!

If you want to be an effective landlord, there are some specifics you need to consider. Here are 5 tips to help you do a better job and feel more comfortable in your role.

1. Put it in writing

Make sure you put everything to do with your rental in writing. Don’t rent to someone with a verbal agreement, because it’s far too easy to get into a “he said – she said” type of argument that can be very hard to sort out. Emails and texts count as “in writing,” but make sure your lease is actually on paper, and that it’s signed by both parties. Having an attorney review it is also a good idea.

2. Don’t bend your rules

Even if you want to help out one of your tenants, don’t help them in a way that requires to you bend (or completely break) a rule you have for your rentals. If you do that, and word gets around, other tenants will be wanting you to bend and break rules for them, as well. Since you don’t want to play favorites, it’s best to say no to any request that would go against your rules.

3. Reward the best tenants

Not bending the rules doesn’t mean you can’t show your appreciation for good tenants. A small gift card during the holidays, or another small way of letting them know you think they’re great is certainly acceptable. Just make sure you don’t chose a reward that breaks or bends any rules you have.

4. Be present but not overbearing

You want to make your presence known, and you want to be sure your tenants are aware how to reach you. At the same time, though, your tenants should feel as though they have privacy in the place they’ve rented. If you’re always around, they’re going to feel too much like you’re checking up on them – and that can make them uncomfortable. Check in only when you need to, and only for valid reasons, but be accessible when tenants need you.

5. Remember who you are

Regardless of how nice your tenants are or any other factors surrounding your interaction with them, you are the landlord, which means you’re in charge. Staying within the law and within the confines of the lease agreement that you signed with your tenants, but be bold about setting and enforcing the rules. Tenants should know they can’t get away with things that you don’t approve of, and that you’ve prohibited in the lease.

6. Be open to learning as you go

Being a landlord isn’t a completely static job. Things are always changing. That can include the laws and regulations for having rental properties where you live, and the types of tenants you have in those rental apartments, too. The more open you are to learning new things as you go along, the better you’ll do at working as a landlord and making sure your tenants stay happy.​

American Apartment Owners Association | Company Website | At the American Apartment Owners Association (AAOA), our mission is to serve the interests of landlords, real estate brokers, property managers, real estate owners and apartment building owners nationally. Visit www.AAOA.com for more information about membership details!

Every successful property management professional knows the status of their inventory intimately. Each community has its own rhythm – defined by the residents, owners and company policies. And, while the rhythm of your property definitely impacts your reputation and desirability ratings, the pulse of your business gives you opportunities to shape and transform community environments.

Think of it this way. The rhythm of your business is the flow of interactions between stakeholders. Rhythm includes workflow patterns, resident engagement, marketing campaign designs and effective cash disbursement processes. Pulse on the other hand, indicates whether your rhythm is healthy and thriving or lackluster and in need of a lifeline to survive.

What You Know Impacts What You Do

Launching a new website to manage leasing and resident services won’t guarantee success unless your agents keep a watchful eye on vital statistics.

To efficaciously drive traffic to your website, and improve occupancy rates, your agents should be able to:

• Monitor active listings and know how many units are available.
• Access upcoming property tour schedules. (And, know how many are confirmed.)
• Compare advertising campaigns and costs associated with implementing each one individually.
• Know where people access listing information (social media, website, print ads, television, etc.)
• Determine how many people view each property.
• Compute return on investment for single listings and broad campaigns.
• Identify most desirable units/communities.
• Compare diverse media channels.
• Discover the “W’s” behind resident engagement patterns. Who is looking at your offerings, on which channels and what is most attractive to prospects and current occupants.

These vital statistics enable you to fine-tune marketing campaigns to your advantage. But, they also give you valuable information to build confidence with owner/clients and expand your audience. Your property pulse is constantly changing. And, your team should actively monitor everything that stimulates change. Real-time data management is crucial for maintaining a thriving business. There’s really no other effective way to quickly respond to changes in the market or consumer behavior.

What You Do Impacts Your Future

When you implement policies that give your leasing agents access to vital information, you make it easier for your agents to view and share information with current and prospective clients. Lead generation activities become more effective.

• Automated reporting and management software features that allow you to post to multiple online sites simultaneously, save you time and money.
• Diving into the analytics helps you stay connected with residents and owners using preferred communication tools – self-service portals, on-demand owner statements, email, text messaging, etc.
• Customized property reports by unit/listing let you share information with owners and investors who need to make financial decisions.

Accessing the knowledge you need to quickly assess property performance is necessary to stay ahead of your competition and deliver high-quality service consumers expect.

If your property management rhythm isn’t healthy, now is the best time to start checking the pulse points.

Appfolio | Company Website | LinkedIn Connect | AppFolio, Inc. develops Property Management Software that helps businesses improve their workflow so they save time and make more money. Appfolio submits articles & blogs including topics of Resident Retention, Improved Owner Communication, Time Management, and more.

| Tuesday March 3, 2015 |

3rd ANNUAL INCOME PROPERTY EXPO OFFERS PRODUCTS, SPEAKERS AND NETWORKING AT PASADENA CONVENTION CENTER MARCH 24

KNX-AM Radio, Apartment News Publications Host Investment and Property
Management Showcase With Real Estate Experts, Seminars and Exhibit Floor  

LOS ANGELES (March 3) – First-time investors, owners and managers of rental properties and commercial real estate are invited to see what’s new in financing, incentives, products and investing strategies from leading area experts at the 3rd Annual Income Property Management Expo, being held at Pasadena Convention Center, 300 East Green Street, Pasadena, CA 91101, 9:00 a.m. to 4:00 p.m. on Tuesday, March 24, 2015.

Expo highlights include free seminars by legal, financial, and investment experts who will present real estate strategies, solutions, tax savings and technologies. An exhibit hall with 100+ vendors will display what’s new in housing and property maintenance, products and services. Attendees can take a break from the day to enjoy
PGA pro golf tips, Segway rides, luxury auto showcase, enter to win prizes, and local craft brewery tastings.

At the show, The HOA Conference and Expo will offer Homeowner Association (HOA) officers, board members and  managers advice for efficiently managing condos, co-ops and community associations. Attendees may also check out remodeling and building trends, sustainable energy systems, get advice on landlord-tenant issues, learn to reduce maintenance costs, and get their questions answered by the experts.

“Our one-day free event offers attendees an opportunity to see what’s new in products and services, attend informative educational seminars, meet the experts and network with their fellow industry professionals,” said Paul Smith, president of On The Edge Promotions and show producer.

Income Property Expo speakers offering the latest information on investments, 1031 exchanges, portfolio management, legal and compliance issues, tenant relations, financing and social media marketing include:

• Russell Smith, Trulia Rentals Manager, a strategic real estate growth and management expert

• Michael A. Harris, mortgage banking expert and host of KFWB Radio’s “The Real Estate Life”

• William L. Exeter of 1031 Exchange Services, tax strategy, self-directed IRA and Land Trust specialist

• Dennis P. Block, eviction, landlord/tenant law authority and past Apartment Association president

• Stephen C. Duringer of Duringer Law Group, experienced landlord tenant law firm and property owner

• Lucas Hall of Cozy Co., successful landlord, portfolio manager, and founder of Landlordolgy.com

• Brian Gordon of Lotus Property Services, property management and real estate investor network

• Vincent Medina of Lotus Property Services, property management and real estate investor network

• Chloe Harford, VP Rentals at Zillow Inc, a leading real estate information marketplace

• Robert “Rusty” Tweed  of Tweed Financial Services, estate planning and wealth management expert

• Kenneth A. Ziskin, expert gift, tax and estate strategist for apartment and rental property owners

• Matthew Holbrook, CEO of Action Property Management, expert in managing community associations

• Basil J. Steele, V.P. Engineering  at Piece of (i) Security Solutions, a security systems expert for 36 years

• Corey Wilson, Founder of CLW Enterprises, a certified public & private construction and facilities expert

Other features include The Great Taste with complimentary tastings by local craft breweries, PGA Golf Action Zone, Segway test drives, and giveaways at sponsor and exhibitor booths. While at the expo enter to win an iPad Air, no purchase is required. Sponsored by Apartment Management Magazine, Chase Bank, Postlets, Intervest, Tweed Financial Services, Duringer Law Group, PGA of Southern California, American Apartment Owners Association, RoyalRoofing.com, HD Supply, and Commercial Property Management Magazine. Media sponsor is KNX 1070 News Radio. The event is produced by On The Edge Promotions.

Admission, registration and parking are free. Seating is limited for panel sessions and seminars. Attendees may pre-register at www.incomepropertyexpo.com or www.HOAExpos.com. Other Income Property Expos are being held in Scottsdale, Arizona and San Mateo, California. For attendee and exhibitor information please contact Jordan Smith at (800) 931-6666 or email expo@aptmags.com. Website is www.incomepropertyexpo.com.

When investing your money into rental properties, people often ignore a vital improve to making their rental property look more attractive to tenants: making green improvements. Not only can green improvements save you money if you’re paying for heat or other utilities, but it becomes an attractive reason for potential tenants to rent your property instead of someone else’s. You will more likely attract and keep tenants, and chances are you may be able to charge more because of the attractiveness of going green.

How Much is this Going to Cost?

Going green will cost some money upfront, but not as much as you might think. You can still go green on your property without a large upfront expenditure. Yes, you can spend quite a bit if you want, but the basic changes will help save both you and your tenants money in the long haul. Let’s look at the changes you need to make the property more green.

Install CFL Lightbulbs

This is one of the simplest changes you can do in a property that will help save electricity. Not to mention make your property look very green. Changing out the older incandescent bulbs for energy efficient CFLs will take a bite out of the electricity bill. In some areas, power companies actually offer coupons and discounts to replace old lightbulbs with CFLs.

Change Shower Heads

Changing the shower heads to low flow varieties can save on water and water bills. This is important especially if you pay for the water to your tenants. Even if you don’t, you’ll reduce the amount of water use and that will reflect on your tenants’ water bills.

Programmable Thermostats

You can change out the old thermostats for programmable thermostats and set them to optimal temperatures as recommended by Energy.gov. Setting the thermostat for no higher than 68 degrees in the winter and 78 degrees in the summer while your tenants are home will ensure comfort while still saving energy. In the wintertime, you can effectively lower the temperature 10 to 15 degrees while your tenants sleep and while they’re at work. In the summertime, program the thermometer 10 to 15 degrees warmer while they work. That way, they can still feel comfortable while saving energy.

Caulk and Seal

Air leaks are a serious way to lose heat or cooling. Caulk and seal leaky areas around window frames, door frames, and any place where you feel cold air coming in. If you feel around the light switches and outlets, you may feel cold or hot air. Use gaskets designed for these items and seal off potential energy drains.

Basic Heating Maintenance

Replace or clean furnace filters regularly. Once a month is optimal. Make certain that the ducts and air registers are unobstructed and clean. If your properties use radiator heat, be sure to bleed the trapped air in the radiators at least once each winter. (If you don’t know how, have a professional do it.) Add a reflector that is heat resistant between the walls and the radiator to provide more heat. Be sure to have the furnace or boiler serviced annually.

Install Fans

An easy way to reduce energy usage is to install fans for use in both summer and winter. Your tenants are likely to use them.

Hot Water Heater

Insulate the hot water heater and the pipes. That way, there will be less heat loss and more energy savings. Set the hot water heater to the lowest comfortable setting to heat up water. If it is time for a replacement, invest in an Energy Star® rated hot water heater.

Recycle Bins

Set up color-coded recycle bins and offer a recycling service to your tenants with posters explaining what goes in what bin. Have a recycling service pick up the recyclables once a month or more, depending on the service.

Replace Appliances

When the appliances need replacing, replace them with more energy efficient Energy Star® appliances. While they may be more expensive at first, they will help save energy in the long run.

American Apartment Owners Association | Company Website | At the American Apartment Owners Association (AAOA), our mission is to serve the interests of landlords, real estate brokers, property managers, real estate owners and apartment building owners nationally. Visit www.AAOA.com for more information about membership details!

Rules and regulations surrounding landlords have been a hot topic in the news recently, especially with the recent rulings regarding Airbnb in New York City. Understanding the local rules and regulations, as well as licensing requirements, are essential to running a strong rental business.

When it comes to business licensing, landlords are often required to register their properties and obtain specific licenses for their rentals, just as with any business owner. Attaining the mandatory licenses will protect your property, tenants and personal assets. Failure to file can lead to costly fines and put you in a risky situation. The following are the basics every landlord should keep in mind.

Common Licenses Specific to Landlords

There are two common property management licenses that landlords will need before they can legally rent a property:

Certificate of Occupancy – Local building or zoning regulatory authorities issue Certificates of Occupancy stating that a property is built and maintained to accommodate occupants. This certificate goes hand in hand with a building permit, which a landlord must file with the local authorities. A Certificate of Occupancy mainly protects tenants and prospective renters, as a local government inspector must ensure the unit complies with building and zoning codes.

Housing business license – A housing business license is usually obtained after the Certificate of Occupancy and is usually required for each rental unit. The housing business license depends on what type of property is being rented. If you own a single-family home, the form is often different than the one you would fill if you owned a duplex or condominium.

Beyond these, some cities have very stringent guidelines whereas other areas have few formal rules for landlords. The number and types of required licenses will differ depending on several elements including where your property is located. Check with your local departments of housing and business to determine your specific needs.

Importance of Staying In Compliance

It is unwise to rent out a property without the required licenses and approvals. There are many consequences that come with renting out property illegally. The government may order you to cease your rental business completely and fine you heavily for not having the proper licensing. If you do not disclose to your insurance provider that you are renting a property, your insurance coverage may not include the unit or occupants in the event of an accident. Another scenario is being unable to evict a tenant because you have not complied with local laws.

Once you have filed the proper documents with the appropriate agencies, you aren’t completely out of the woods in regards to licensing. Business licenses expire and requirements change with time. Be sure you are on top of renewal deadlines and fees to stay in compliance with the government.

Being a landlord can provide increased financial freedom if you set yourself up for success at the beginning. Not having the necessary forms and permits puts your assets and the safety of tenants in jeopardy. Investing the time needed to research the licenses that are applicable to your property and registering with the local authorities will put your property business in compliance and minimize risk. You can also work with a business services company who can help with the research or consult your lawyer or accountant.

Jennifer Friedman is the CMO of the small business segment of CT, a Wolters Kluwer Company, which provides legal compliance solutions to small businesses. In this role, Jennifer directs all activities related to digital marketing and advertising to help build the brand through innovation, partnerships, and enhancing the customer experience. Visit https://ct.wolterskluwer.com/