Become a Master Strategist: Today’s Key for Successful Landlords
I have always had a lead foot. It is hard to admit but with my hard charging personality, I just want to get where I am going… fast. As a young man, to prevent countless tickets, I purchased a radar detector which allowed me to sense a police officer before he could see me. Police departments realized they were being outsmarted by this technology and needed to make a change, so they started using a different band which most consumer radar detectors did not have at the time. The private market reacted as they always do, and soon you could buy a radar detector that included the new bands used by law enforcement. This produced a battle between radar detector companies and police, with one making a move, only to be met with a counter move by the other.
We find ourselves in a similar tug-of-war when it comes to evictions, where the CDC has now made a move to stop all evictions nationwide in an attempt to limit CoVid 19 spread through homeless shelters or crowded family shelters. As landlords, we are being forced to react to what I personally believe is an overreach. After spending the last few days fuming about this decision and asking myself if I still live in a free country, I have gone through 4 of the 5 steps of grief (Denial, Anger, Bargaining, and Depression), and now am working my way to the 5th step; acceptance.
Acceptance of the fact that this is happening, but by no means rolling over when it comes to managing properties; it is time make a move and consider strategies to protect your investments. Every property is different and certain strategies might not work for your property. This is not legal counsel and I always recommend when you make a change to any process you run it by your local attorneys to make sure it is legal in your state. Please consider these as potential ways to better position in relation to your rental properties. The following are strategies many of my clients and I have discussed concerning our policies and criteria:
Strategy 1- Inspect your rental properties monthly
We are not targeting, merely being cautious as we might have to get our homes or apartments ready to sell in these uncertain times. Does the carpet need to be replaced? Are the filters to the cooling and heating system in good shape, helping to preserve the HVAC unit? Does the landscaping need maintenance? There is no better time to get your properties in order to sell.
The CDC order only limits evictions for non-payment of rent. If there are violations of the lease like unauthorized residents, criminal behavior, pets, smoking, damage to the property or other violations, you can give a proper notice to cure in most states and then move to eviction. Monthly visits help you stay on top of any of these types of violations.
If you choose to implement this strategy, make sure you are inspecting every property you own in a similar manner, and not just singling out a few.
Strategy 2 – Raise your criteria
With the inability to evict tenants for nonpayment of rent, finding the right tenants in the first place becomes paramount. Raising the credit score requirements will help find people who have shown responsibilities in the past, giving you a good idea of how they will perform in the future. It should be noted here that evictions, judgements, and liens are no longer on credit bureaus, so those actions will