According to Fair Housing Act of 1968, it is illegal for property owners and property management to refuse tenancy to an individual based on religion, sex, race, national origin, disability, or family status. However, a property manager has to consider the prospective tenant's finances and ability to pay the rent. Therefore, property management should have strict policies based on consistency and fairness, regarding screening of prospective tenants. Here are some important criteria that can be implemented into the screening process.
Establishing Income Level Requirement
This might involve extra work, but it will save a lot of time in the end for a property manager. When there are different types of properties, or different types of units on a single property, property management can work out the minimum income a prospect should be earning for renting the particular unit. For example, if there is a one-bedroom unit that has a monthly rent of $600, the minimum income requirement could be fixed at $1,800. All applicants for such a unit whose income is below the required level are to be declined without exceptions.
Policies for Reviewing Credit Report
A credit report is a strong indicator of the prospective tenant's finances. However, there are many ways to judge a credit report, especially when the economy is not doing well. Many property managers consider various aspects, apart from the figures shown in the credit report. Hence, if you are willing to accept a tenant with a low credit score, while considering other aspects, then you should consistently apply the same policy to all prospective tenants. Once a particular standard is fixed, it should be uniformly applied without any exceptions.
Considering rental history of a prospective tenant is quite important, as it provides a picture of what type of tenant the person has been in the past. An application can be legitimately denied if the rental history shows, damaged homes, evictions, and/or consistent late payments of rents. Again, if you are basing your policies on rental history, then they should be consistently applied for all, and not be biased towards a specific group.
Job stability is an important factor to consider while screening prospective tenants. Evaluating employment history of the individual will provide information about how long the person is able to hold on to a job. However, it is difficult to frame an exact policy about reviewing job history, as many factors can come into play regarding job changes. Individuals, who are just starting out on their career might have to change jobs to find better opportunities according to the experience they have gained.
Secondly, a person who has recently moved into the area might not have enough time in a particular job, which might indicate instability. Hence, it is important to carefully chart out all types of exceptions and apply them uniformly.
While screening tenants it is important not to take cultural background, disability, familial status, sex, or race into consideration. Secondly, whatever standards are adopted for screening various other aspects, they should be uniformly applied to all.
With improved technology and advanced online applications, the task of protecting privacy and personal information of residents has become more challenging for property management. The task of securing online personal data is in itself a major worry, and there is no foolproof way of ensuring privacy. However, by implementing proper policies the data of your tenants can be protected for the most part.
A Noble Campaign
Marketing strategies for the property are now mainly aimed at creating a brand image and in creating a personalized experience. This translates into happier tenants, lower vacancies, and a better retention of fantastic tenants. To implement the marketing strategies, a property manager will have to design advanced techniques for collecting information and generate effective mobile campaigns. This will not only help in retaining old tenants but also help in finding new prospects.
As if it was Your Own
Property management gains immensely by integrating collection of data and developing personalized strategies. However, along with the advantages of such techniques, the risk of personal data being breached also increases tremendously. Even though these risks exist, most of it can be mitigated by providing proper training to the staff and effectively managing information collecting techniques.
Property management can include some effective strategies such as:
- oDesign strict internal policies to ensure protection of tenant privacy.
- oRestrict access of employees to sensitive paper as well as electronic information. Routing of information should take place in a way, where private information is available only to select designated personnel.
- oRoutinely change PIN numbers and passwords once a month, and especially when a key staff member is terminated, retired, or transferred.
- oAll digital information should be protected by passwords and online data should be protected by specialized software that prevents spying and hacking.
- oDigital storage media and printed documents should always be secured in locked cabinets, and access should be restricted to few responsible staff members.
- oIt is best to have a shredder in the office for disposing outdated documents.
- oDevise safe policies for social media engagement and the information routed through these channels.
Apart from digital and online security, property management should not ignore the advantages of having a separate space that is designated mainly for meeting with tenants and prospects. Conversations taking place between property manager and tenants should be kept private and therefore having a separate office space or meeting area is critical.
Leasing or renting procedures, especially applications and renewals will generate lot of personal information. Employees should be trained to protect this sensitive information, and when separate space is not available employees should be instructed not to state social security numbers, phone numbers, and other types of sensitive information aloud, but rather point it out on the document.
While training employees for protecting personal information, property management should focus on how the employees should respond to information requests from:
- Other employees
- Law enforcement agencies
- In case of emergencies
Protecting privacy and personal information will require proper planning and a coordinated effort of the whole property management team.
Apart from regular inspection of the common areas, a property manager has to carry out inspection of each unit at least once a year. Having magnificent long-term tenants, who correctly renew their leases each year, is definitely a boon. However, property management will never have a chance to inspect such units when they are vacant, and hence it becomes imperative to carry out inspections when these units are occupied.
Property inspections are unavoidable because property manager must have a salient idea about the condition of the unit, so that repairs and maintenance can be carried out wherever required. However, inspection of occupied units is usually not appreciated by tenants, and must be handled carefully.
Provide Prior Notice of the Inspection
The lease should have a clear clause stating that property management will be carrying out annual inspection of the unit. Even with such a clause, the property manager will have to provide prior notice before inspecting the unit. Surprise inspections are to be avoided, unless there is suspicion of the tenant violating the lease agreement or general restrictions. Even in such cases, one has to be careful, as the law requires you to provide advance notice before inspection.
Make Tenants Understand the Importance of Inspection
Proper functioning of appliances, electrical systems, and structural integrity is important for the tenant and for property management as well. From a small thing like a tile chipped in the bathroom, to a maintenance check of the HVAC system, all issues can be sorted out efficiently by annual inspections. Hence, make the tenant understand that the inspection will prove to be mutually beneficial, and there is no need to be opposed to the process.
Tenant should be Present During an Inspection
Make sure at least one of the tenants occupying the particular unit is present when the inspection is being carried out. This will not only prevent any accusations later about theft and so on, but also you will have the chance of inquiring about any potential issues or complaints the tenant might have with systems, appliances, plumbing, and structural integrity of the unit. Most tenants are happy about the inspection, since they acquire a chance to air their grievances or suggestions.
Do not Photograph Personal Items
Property manager might want to take a photo of the bent windowpane or of the chipped flooring, to show it to the maintenance staff. This is fine, provided the photo does not include any of the personal items of the tenant. According to rules, property manager is not permitted to take photos of personal items such as valuables, family photos, pets, computers, and even pictures of the tenants.
During inspection, the property manager might come across units that are very badly kept or the tenant might even have caused considerable damage. However, it is not a terrific idea to confront the tenant about such issues face to face, but rather send a written notice. The manager will have to document and enumerate each issue clearly during the inspection, and then put it all in a letter, stating the terms and conditions of the lease agreement that are being violated.
Taking regular inventory is critical for having proper control over assets. This also holds true for property management, who not only have to keep track of inventory but also need to implement strategies for maintaining a respectable return from their assets. Properties should have a policy of conducting an annual inventory, which will provide the property manager adequate information to review and control the assets. Here are the main advantages of the annual property inventory.
Estimating Replacement and Insurance Costs
Inventory will provide detailed information about assets that includes supplies, fixtures, and furnishings. This information will help the property manager in making a decision about the type of insurance required and the coverage limits. Secondly, for taking insurance itself, you need to provide an accurate inventory of the assets to the insurance company. Failure to accept the proper coverage will mean increased risks, while paying for coverage on nonexistent assets will be a waste.
Reviewing each unit annually for the inventory will also help the property manager in detecting potential issues early, and repairs can be done immediately to prevent expensive breakdowns. For instance, timely cleaning of the HVAC unit could mitigate costly damages and replacements. While taking inventory, the usual checklist for units should include:
- §Bathroom fixtures
- §Window treatments
If the units are fully furnished, then convenience items like dishes and linens will also be included.
Preserving the Image of the Property
Appliances and property tend to become damaged, succumb to time and decay, or they simply seem to disappear over time, especially in the high frequent areas. This will make the property look quite shabby as years go by. Regular inventory will help property management detect items that are missing or damaged. Replacement of damaged or old items such as trash receptacles, flowerpots, and decorative fixtures can improve the image of the property substantially. With regular inventories, the property manager can figure out items that require frequent replacements and repairs. Such items can be replaced with things that are more durable, or they could be shifted to places where the traffic is not heavy.
Control over the Budget
Annual inventory covering the whole property will provide critical information that can be used for maintaining better control over spending and overall budget for the next year. Costly items such as digital devices, maintenance tools, and office equipment should be tagged with identification codes that will help in monitoring and tracking them more closely. Regular inventory will also promote a better program for asset management, which will be able to identify wasteful spending. Inventory will also help property management to record losses while filing tax returns and valuable data will be available for making more accurate budget estimates.
Forming a policy and introducing an effective system for taking inventory every year has many advantages for property management. The property manager will be able to exercise tighter control over the budget, and reduce wasteful spending which in this recession, could be the difference of creating strong financial health or insolvency. Damaged and old stuff can be repaired or replaced in time to avoid and more expenditures and to avoid a reputational hit, while the image of the property can remain unblemished.
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