Landlords: your tenants want updates.
When asked the question "What one improvement would you wish for your rental?" upon vacating, our tenants had a lot to say.
Here's a list of the most common answers we received this year in order of frequency:
- Needs upgrades and updating
- Update appliances most commonly mentioned is the fridge
- New flooring (carpet or vinyl is old)
- Provide lawn care
- New light fixtures; fans in all rooms
- Windows and screens are old
- Fenced yard or repairs to old fence
- New counter tops
- Needs new a/c unit
- No gutters on home
- Updated bathroom
- Wallpaper ripped out everywhere
- New exterior doors
We know the old saying is "if it ain't broke, don't fix it", but your tenants disagree. They want new fixtures and updated energy efficiency. Tenants expect their landlord to continually make upgrades and provide routine maintenance. Landlords should build up a reserve to make these upgrades.
As your property ages, it's a good idea to invest in routinely replacing components in your home. To keep your home in good condition, you should be completing maintenance frequently on your properties. Making these and other improvements will yield higher rents, less vacancy, and an overall better experience for you as a landlord.
Reach out to us with any questions about becoming a Pensacola area landlord. We specialize in working with investors and landlords in the Pensacola real estate market. As we manage over 1,000 rental properties, our real estate agents understand rental market trends.
We are currently accepting new properties in good condition in Pensacola, Pace, Milton, Gulf Breeze, Pensacola Beach, Perdido Key, and Navarre.
Some items an owner SHOULD AVOID having in their rental property!
As property management professionals, we have a lot of experience in mitigating risk. Because of this, there are several items we would never recommend having in a rental property. Here's a list of our top five:
- Trampolines: We understand, you don't want to remove these items from the property as you have enjoyed using them. While it sounds like a nice amenitiy for your rental property, it would be best case scenario to haul these items away from a rental property. These items are big liability issues and safety concerns. Additionally, your insurance policy may not allow them at the property. If your insurance policy excludes trampolines, as many do, you will be held liable without protection should someone get hurt.
- Playsets and Patio Furniture Sets: The estimated life span of exterior items such as patio furniture and playsets are low. Over time, these items will decay and become a safety liability for your residents. If a tenant or guest is hurt because these items, you can be held liable.
- Above Ground Pools, Expensive Pool Filtration System and Hot tubs: Unless you are including pool maintenance with the rental amount then I highly recommend not having this installed. Tenants are expected to maintain the home as if it is their own and treat the home with care, but this isn’t always the case. If this system breaks, requires upkeep, or preventive maintenance – you may not be able to rely on the tenant to take care of it. We are recommending that our owners have pool maintenance included, if their property has a pool, for this reason. This will save a lot of headaches and sleepless nights. Trust us!
- Salt Water Treatment System: This is amazing to have in newer homes to increase the longevity of the pipes or in old areas where hard water is a problem. If you have routine maintenance to take care of the system, it is a great asset for the home. Unfortunately, along the same thinking with pools, sometimes tenants do not take the needed care of systems while in your property. If there is an issue with the system or upkeep needed – you are on the hook.
- Security Systems or Alarm Systems: Added security is usually always a plus; it is attractive to renters for peace of mind and also can be helpful for any emergency services. The major drawback we have with alarm systems is the service setup with them. Most of the time, the service is disconnected and the hardware is still at the house. This can lead to confusion that it is active or not. Some tenants setup service and are able to use the system in place, but other times if tenants wanted a security system the companies install new hardware. Overall, it becomes an unnecessary hassle that is not maintained
As the real estate market in Pensacola is improving, more hesitant or forced landlords are seeking to sell their tenant occupied rental properties in the Pensacola area. For the first time in years, accidental landlords are able to sell their properties. You may be looking at capital gains taxes and running out of the timeline allowed to sell. Check with your accountant for advice on this.
If you are a landlord of a duplex, apartment, or lower end property, it is most likely advantageous to sell your property with a tenant who has an existing lease so this advice does not necessarily apply to you. Investors looking to purchase properties want a property with a current tenant in place so keep that in mind! Most of the properties in our rental portfolio will only be marketable to home owners looking to purchase an owner occupied residence.
If you dislike being a landlord or are in the financial position where selling your property is a necessity for you, this advice is for you.
If you are considering selling, consider our best practices for selling your rental property before making a move to list your home.
1. Approach your tenants first!
You may already have a ready, willing and able buyer. We just closed on a property this week for a landlord whose tenant purchased the home at fair market value and have another duplex under contract with current occupants.
2. Consider putting the property for rent or for sale when you place it on the rental market.
Unsure whether you want to try to lease or sell? Let us put it on the market for rent or for sale when your tenants give notice to vacate.
Consider the average time on the market for Pensacola homes for sale is approximately 90 days whereas the average time on the rental market is about 30 days. If you are really anxious to sell, it’s best to list it a month on the sales market prior to listing it for rent. While your home being on the sales market may turn away a few renters, it will not keep your house from selling and may even entice a buyer to act faster.
3. Review your lease agreement.
Does your tenant's’ lease agreement address the sale of your property? Remember, Florida Landlord Tenant Law does not cancel your lease agreement upon the sale of your property and the new owner is bound to fulfill this lease agreement unless your lease states otherwise.
Luckily, our lease agreement says that tenants can be given a 60 day notice to vacate and terminate their lease once the property is under contract for sale. Consider the tenants required notice period as well as the time it will take them to vacate before listing your rental property for sale.
If your tenant is in a lease agreement, it will be necessary to give your tenant proper notice to vacate. The law can be confusing in this area and largely depends on what your lease agreement says so if you are homeowner in the state of Florida without a Realty Masters lease, consult your lease agreement and Florida Landlord Tenant Law.
4. Consider your tenants lease expiration date.
Don’t put the property on the market for sale when tenants have just moved in or renewed their lease. They will be mad and a scorned tenant is not in your best interest. Think of how much effort is required to move, much less all the extra cost involved in moving. Your tenant will not be cooperative, happy, or good to your property during the time they reside in your home.
We find one of the best times to list your property is 2-4 months prior to your tenants move out date.
5. Consider deadlines for the sale and communicate a plan of action to your tenant.
If you do have interest in selling and don’t want a vacancy, the best course of action is to set a timeline up front to the tenant. It’s best to approach your tenants to explain your desire and necessity to sell and learn their intentions at the end of the lease renewal. Once knowing if they want to stay or are going to move regardless, you can plan an appropriate course of action. If they want to stay, set the expectations and timelines upfront.
For example, you could list the property 90 days prior to the lease expiration and remove it from the sales markes if it doesn’t sell within 60 days.
Make sure be sure you communicate a plan you will agree to stick to prior to talking with your tenants.
6. Consider an incentive for the tenant.
Don’t expect your tenants to be as interested in selling your property as you are! Incentivize them to do so. For example, we have seen owners offer a slightly reduced monthly rent and a full return of the deposit even when repairs are necessary as a financial incentive for showings. We recommend offering an incentive to your tenant if you want a smooth sale.
One of the biggest hurdles when selling your tenant occupied home is delayed access to the property. Florida Landlord Tenant Law require reasonable notice as defined as 12 hours. Our company policy is to require next day notice in order to meet the threshold the law defines. Real estate sales happen in real time and don’t always provide advanced notice. You must realize your home will miss showings to qualified buyers due to this time delay. Renters become disheartened by the number of showings and feel their quality of life is decreased when their home is being marketed for sale. This can cause a tenant to be uncooperative in showings or inspections, vacate your property or even attempt to break their lease early.
Tenants have never sold a property and don’t understand the process. Showing your home to multiple sets of buyers repeatedly causes inconveniences and can be seen as an intrusion in privacy. Offering them a financial incentive leads to tenant buy in and will help you achieve your goal of selling your property.
7. Your rental home probably needs some sprucing up to be competitive in a real estate market with owner occupied homes.
Your tenants don’t necessary want your home to sell and most likely hope it does not sell! With competing interests, your property will be harder to sell than a normal owner occupied Pensacola area home.
Renters may not necessarily keep in the home in show ready condition. You can avoid negative showing feedback if you have a Realtor walk through your home prior to listing it. Listen to their feedback and make any cost effective changes possible prior to listing your house on the market for sale.
- Consider a home inspection prior to the sale so you can address issues that be present in your inspection. If your windows are fogging, roof has less than 5 years age, or your siding has a lot of wood rot, this will cause problems. Items like these are common and can be expensive repairs that may prevent you from selling your property to an FHA or VA buyer due to lending restrictions. It’s better to know and address as many items upfront to be sure your ready, willing, and able buyer will be able to purchase your home.
Are you interested in a market anaylsis for your rental property? Reach out to our sales team or email me!
Nicole St. Aubin, Broker Associate
#1 in Pensacola Rental Houses
It's important to have the right mindset in order to be a successful landlord.
Recently, I have seen several stories online relating to violence between landlords and tenants. A tenant was stabbed in the Bronx; a landlord was killed in her house in Clearwater, Florida. It can be hard being a landlord, but it shouldn’t land you in a hospital, a jail, or a morgue.
In most cases, your tenants will rarely take as good of care of your property as you would. Your renters will not pay for maintenance costs willingly and they will most likely not properly prepare your property for the next resident. Your rental is going to have vacancy time and it will cost you money. It is very likely that you will have to pay for a very expensive repair at some point. These are the risks and challenges you accept when becoming a landlord.
When becoming a landlord you must have the right mindset to be accepting of these truths or the entire experience of being a landlord could drive you crazy.
If you go into being a landlord thinking, “I can find the over-achiever, grade A tenants every time!” you will probably be disappointed.
Another idea new landlords have is, “I just want my property to look like it did when I lived there”, but this is not a realistic long-term approach to being a landlord unless you contribute to keeping it that way. You must put forth effort, money, and energy into maintaining or improving your properties. Landlord Tenant Law does not allow landlords to charge tenants for every cost required to turn over a property for a new tenant. The majority of tenants will not do routine maintenance tasks such as pressure washing, small interior maintenance, or keeping up with the yard.
Instead, realize that your tenants are not going to put forth the same effort you may have and incentivize them to do more by equally contributing to routine and preventative maintenance.
Be very appreciative of your excellent tenants.
- The ones who pay rent on time, keep your place immaculate, plant flowers, and don’t complain or ask for a lot.
- Send them a thank you card or mail them a small gift during the holidays.
- Thank them for preserving your property like you would have and for increasing the property value while they did.
Be appreciative of your good tenants.
- The ones who paid a week late that one time when their car died, that don’t plant flowers, but that mow the yard timely.
- The ones that don’t clean right when they move and the walls need a little touch up but everything is intact and well cared for.
- By occupying your rental property, they are helping you to gain equity, to keep your credit score up, and to save for retirement.
You can even be appreciative of the bad tenants.
- Appreciate the ones who call every month with some new major issue because they’re not letting your house fall apart.
- Appreciate the ones who move in the middle of the lease because they paid rent timely and voluntarily turned over keys so no eviction was necessary.
- Be appreciative of the ones that stayed for five years even though they were so messy and Florida Landlord Tenant Law says you can’t charge them for fresh paint and new carpet. Appreciate them because they have saved you months of vacancy costs over the years.
Look at being a landlord as being a small business owner. With revenue comes expeses.
Routine and preventative maintenance is important for your rental investment and increases the value of your real estate asset. Properties with up-to-date features and in overall better condition will yield higher rents, be easier to maintain, and have less vacancy costs.
- Don’t be upset when your tenant calls in routine maintenance, be appreciative of the opportunity to increase the value of your long-term asset in smaller increments over time.
- It will be a relief when the A/C repair only costs you $350 because it didn’t require a brand new inside and outside unit.
- Be appreciative when the plumbing emergency doesn’t happen on a Sunday or a holiday and that it didn’t flood your downstairs.
Landlords who invest in real estate with the wrong mindset will constantly be disappointed with their tenants actions and will never appreciate the fact that another person is paying down their mortgage and helping them to build wealth with a real estate investment.
Do you have questions about becoming a landlord in the Pensacola, Florida area? Reach out to our team for honest advice on being a landlord.
Nicole St. Aubin, Broker Associate
#1 in Pensacola Rental Houses
- What does Florida Landlord Tenant Law say about owners visiting their properties while the home is tenant occupied?
As a local landlord with or without a professional property manager, you may be required to visit your rental property regularly for inspections, maintenance, and showings. You may also just be in the area and inclined to drive by and check up on your tenants. Before you do that, make sure you know and understand your state’s landlord tenant laws.
For those Florida landlords who live close by their rental properties, here are the 2016 Florida Landlord and Tenant Statutes to consider.
“83.53 Landlord’s access to dwelling unit.—
(1) The tenant shall not unreasonably withhold consent to the landlord to enter the dwelling unit from time to time in order to inspect the premises; make necessary or agreed repairs, decorations, alterations, or improvements; supply agreed services; or exhibit the dwelling unit to prospective or actual purchasers, mortgagees, tenants, workers, or contractors.
(2) The landlord may enter the dwelling unit at any time for the protection or preservation of the premises. The landlord may enter the dwelling unit upon reasonable notice to the tenant and at a reasonable time for the purpose of repair of the premises. “Reasonable notice” for the purpose of repair is notice given at least 12 hours prior to the entry, and reasonable time for the purpose of repair shall be between the hours of 7:30 a.m. and 8:00 p.m. The landlord may enter the dwelling unit when necessary for the further purposes set forth in subsection (1) under any of the following circumstances:
(a) With the consent of the tenant;
(b) In case of emergency;
(c) When the tenant unreasonably withholds consent; or
(d) If the tenant is absent from the premises for a period of time equal to one-half the time for periodic rental payments. If the rent is current and the tenant notifies the landlord of an intended absence, then the landlord may enter only with the consent of the tenant or for the protection or preservation of the premises.
(3) The landlord shall not abuse the right of access nor use it to harass the tenant.”
- Landlord's Access to the Property
The law protects both landlord and tenant and provides the landlord access to the property without violating the privacy of the tenant.
The law allows you to inspect, make repairs, and show the property “from time to time” with reasonable 12 hour advanced notice during reasonable hours even if the tenant refuses to consent. As a landlord, you can give prior reasonable notice and visit your home to routinely inspect how it’s being cared for.
- How should you notify your tenants?
Call your tenant ahead of time to notify them.
If your tenant does not answer, consent, or acknowledge receipt of your message, you should post a notice to the door outlining the time and reason for the visit.
The law does not allow the tenant to refuse entry under normal circumstances as long as reasonable notice is provided. While twelve hour notice is required under the law, best practice is to provide at least next day notice for showings, inspections, etc. If the tenant consents to earlier notice, the landlord is allowed entry under the law.
- In Case of Emergencies
The law does protect you in case of an actual emergency.
Say you own a condo and the HOA calls to yell you water is leaking from your unit. You have tried to contact your tenant and they are not responding but you have left a message. You can legally enter the property (after knocking) with a key to turn the water off. You do not have to wait for the tenant's authorization or post reasonable notice on the premises. Make sure to examine the situation and ensure it is an actual emergency prior to entering! It is always better to get the tenant's authorization prior to entering the property.
If you cannot reach your tenant and are worried about their health or safety, best practice is to call the police for a welfare check on the property. You cannot enter without adequate notice or the tenant's approval.
- Outdoors and Backyards
Keep in mind, you may be held in violation of the law if you are accessing the backyard or any outbuildings, especially if it’s a fenced backyard and/or locked, without prior notification and consent.
Exterior pool or lawn maintenance should be planned in advance or scheduled on a routine basis. Under the law, you cannot show up in the backyard without some sort of advanced notice.
There is a fine line between being proactive with your tenants and offending them and breaking the law! Confronting your tenant with anger or other elevated emotions will only worsen your situation. It’s best to keep cool if you see something you don’t like about your rental property or tenants behavior. You must keep in mind that the tenant is paying rent and you have granted possession under the law to the tenant.
- If you have an issue with your tenant, address it properly.
Provide advanced notice for inspection to the tenant to inspect the situation further. Document your issues properly with photos and a dated written report.
Discuss your issues with your tenant and give them an opportunity to cure the issues. If they don’t, you can provide them with a 7 day notice under the law to cure any lease violations.
Be sure to follow procedures under the law to ensure safety for both your tenant, your property, and yourself.
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