This week the question for Ask Landlord Hank is about how landlords and property managers look at bad credit history from a potential tenant.
Dear Landlord Hank:
Will some landlords overlook bad credit history if it was mainly caused by a husband passing away from cancer, and then COVID-19 affecting us all?
Especially if my monthly funds well cover my bills and I’m now in consolidation?
-Arden
Dear Arden,
I’m so sorry for your loss.
When a landlord evaluates a possible tenant, the landlord wants to make sure the tenant is going to be able to afford to pay the rent, and will pay the rent when it is due without drama, will take care of the property, and will not annoy the neighbors.
A person’s credit history is a great indicator of willingness to pay money owed when it is due, and an owner can see your history of being responsible for your obligations.
That is a big part of what a landlord is looking for, but there are so many more factors that a landlord considers before making the decision to accept a tenant:
Does the client have a good rental history?
Do they make at least three times the rent and have a stable income?
Has there been any criminal history? What about sexual predators or offenders?
Many property owners will look at credit history as being black or white, but some are willing to dig deeper. You have a legitimate reason for having monetary difficulties and some owners may take that into consideration if your history was good before the devastating events and has improved significantly lately.
If all the other factors are good, and you tell a prospective landlord what to expect up front, you may find someone willing to give you a chance. Best of luck.
Sincerely,
Hank Rossi
Landlord Hank says, “Many property owners will look at credit history as being black or white, but some are willing to dig deeper.”
Ask Landlord Hank Your Question
Ask veteran landlord and property manager Hank Rossi your questions from tenant screening to leases to pets and more! He provides answers each week to landlords.
Up to 90 cents of each dollar paid for rent go towards taxes, wages, mortgage payments, and maintenance and improvements, while only 10 cents belong to owners and investors, according to the Yardi Matrix Covid-19 Rental Housing Support Initiative.
In their blog, RentCafé says the American Rescue Plan signed by President Biden on March 11 “brings much-anticipated relief to millions of American families, both renters and housing providers.”
Rent debt estimated at almost $60 billion has built up since the start of the pandemic and RentCafé says the new stimulus package “may trigger a butterfly effect across local communities. Since many housing providers operate on thin margins, the recently approved stimulus package will help fill the gap in cash flow and keep afloat an industry that provides housing for 40 million Americans.”
According to the Urban Institute and Moody’s Analytics estimations, the average resident who’s behind on rent already owes $6,000. With approximately 10.25 million renters in debt as of January 2021, the back rent reached an estimated $57.3 billion.
Rent checks go back into the local economy
The report from RentCafé includes a chart showing the largest part of every dollar of rent is used to keep rental housing operational, as 90 cents of it go towards state and local taxes, which support essential services in the community, employee wages, maintenance and improvements, and mortgage payments. Just 10 cents go to property owners and investors.
Up to 90 cents of each dollar paid for rent go towards taxes, wages, mortgage payments, and maintenance and improvements, while only 10 cents belong to owners and investors.
“This means that each dollar paid as rent, besides keeping renters safely housed, is also a contribution to the local economy. Rent checks are reinvested in the community in the form of taxes, worker salaries and maintenance for buildings,” the report says.
Mortgage payments take up the largest chunk of rent, 38 cents.
“The majority of small owners depend on this money, according to data from the COVID-19 Rental Housing Initiative, as 59 percent of them carry a mortgage, and many of them operate on thin margins,” the report says. “Rents in properties owned by mom-and-pop landlords are typically lower than in larger, amenity-rich communities. So, by helping families pay the rent, the federal assistance fund would in fact support these owners, who otherwise might default on loans.”
Due to the potential economic impact of the outstanding rent debt, rental industry associations “believe that more needs to be done to avoid turning the public health crisis into a housing crisis, especially now, with so much uncertainty around the economic recovery.
A California property owner and manager has agreed to pay $10,000 in a conciliation agreement resolving an assistance animal discrimination claim that the landlord denied a resident’s reasonable-accommodation request to keep an assistance animal, according to a release.
The U.S. Department of Housing and Urban Development (HUD) said in the release it has approved a conciliation agreement between Monterey, California-based rental property owners and managers G Davi Properties and Guido A. Davi II and a resident of one of their properties.
“An assistance animal can be a lifeline for persons with disabilities,” said Jeanine Worden, HUD’s Acting Assistant Secretary for Fair Housing and Equal Opportunity, in the release. “HUD is committed to enforcing the Fair Housing Act to ensure that housing providers recognize their obligation” to make accommodations when needed to comply with the nation’s fair housing laws.
The complaint came to HUD’s attention when the resident who has disabilities filed a complaint alleging that G Davi Properties and Guido A. Davi II discriminated against him by failing to grant his request to keep an assistance animal, according to the release.
“After denying his request, the owners allegedly cancelled the lease, changed the locks on the unit, and threatened to call the police in the event that he attempted to move in. The owners also allegedly claimed that the man never disclosed his need for an assistance animal, even though he provided a letter from his physician verifying his disability and need for the assistance animal,” the release says.
“The owners/managers deny that they discriminated against the complainant and denied any violation of law, but voluntarily agreed to settle the complaint. Under the conciliation agreement, they will pay $10,000 to the resident, provide fair-housing training for their employees, create and implement a written reasonable accommodation policy, and modify any rental forms or materials to be consistent with the Fair Housing Act.
Assistance Animal Or Service Animal Discrimination
“The Fair Housing Act prohibits housing providers from discriminating against people with disabilities, including refusing to make reasonable accommodations in policies or practices when such accommodations may be necessary to provide persons with disabilities an equal opportunity to use or enjoy a dwelling.
“This includes permitting persons with disabilities to have service animals or assistance animals. Housing providers, unlike public accommodations, may not prohibit people with disabilities from having assistance animals that perform work or tasks, or that provide disability-related emotional support,” HUD said in the release.
A landlord should not determine who needs an assistance animal, HUD says.
“It’s not a housing provider’s role to determine who does or does not need an assistance animal,” said Jeanine Worden, HUD’s Acting Assistant Secretary for Fair Housing and Equal Opportunity.
“It’s not a housing provider’s role to determine who does or does not need an assistance animal,” said Jeanine Worden, HUD’s Acting Assistant Secretary for Fair Housing and Equal Opportunity.
What a reasonable-accommodation policy for an assistance animal should say
HUD says the landlord policy “must explicitly acknowledge and advise employees, tenants and prospective tenants that an assistance animal may qualify as a reasonable accommodation under the act. The policy shall acknowledge that medical verification may be necessary only if the disability and/or need for the accommodation or modification is not obvious and apparent. The policy shall further acknowledge that such verification may come from a doctor or other medical professional, such as a therapist, physician’s assistant, nurse, counselor, social worker, a non-medical service agency, or a reliable third party who is in a position to know about the individual’s disability.
“The policy shall also specify that (landlords and property managers) will provide timely responses in writing to all requests for reasonable accommodation.
“The policy shall require the tracking of each reasonable-accommodation request, including, but not limited to, the date of receipt, the name and address of the requester, whether verification of disability and need were requested, whether the request was approved or denied, and when the accommodation was fully implemented,” HUD said in the agreement.
While national rent growth was negative in February, hard-hit markets have shifted closer to positive rent recovery and growth and February may be the last month of national declines, according to Yardi Matrix’s February report.
“Many markets experienced strong year-over-year rent growth in February, while others have begun to recover following rent declines in the summer and fall. However, urban cores continue to see rent declines,” the report said.
Highlights of the report:
Multifamily rents declined by 0.1 percent on a year-over-year basis in February. But while national rent growth was negative this month, year-over-year rents have steadily shifted closer to positive rent recovery since October. If this trend continues, February could be the last month with a national decline.
Overall rents increased by $3.00 in February, to $1,399. This is the ninth consecutive month where overall rents have increased or remained flat, pointing to signs of recovery.
Outside of the gateway and top 30 markets, there was a large pop in month-over-month rents in many secondary and tertiary markets. Out of 133 markets surveyed this month, 111 had positive month-over-month rent growth.
“A major factor in their ability to bounce back is the percentage of the workforce that remains remote once the pandemic subsides,” the report says.
“The trends that we have been discussing since the beginning of the pandemic continued into February. Lower-cost markets are outperforming, while expensive gateway markets that were the most locked down due to COVID-19 restrictions continue to struggle—although not at the rate we initially saw,” Yardi Matrix said.
Positive rents growth by end of 2021
“We are forecasting most markets to have positive rent growth by the end of 2021, except for select gateway markets that will take longer to recover,” the report says.
“Many young people that would typically occupy urban cores moved in with their parents when the pandemic began. We are starting to see this trend unwind, with young people moving out again.
“But a hindrance to the recovery in urban cores will be the percentage of the workforce that makes a permanent shift to remote work.”
Before the pandemic statistics showed about 10 percent of people worked from home.
“Once the pandemic is behind us, it is estimated that as much as 25 percent could do so permanently. This shift will undoubtedly have an impact on the recovery of urban cores,” Yardi Matrix said.
About Yardi Matrix:
Yardi Matrix researches and reports on multifamily, office and self-storage properties across the United States, serving the needs of a variety of industry professionals. Yardi Matrix Multifamily provides accurate data on 18+ million units, covering more than 90 percent of the U.S. population. Contact the company at (480) 663-1149.
If the tenant tells you they are moving out before lease ends, what should you do is the question for Ask Landlord Hank this week.
Dear Landlord Hank,
My tenant signed a six-month lease and is planning on moving out after five months has told/emailed me of his intent, but sent no 30-day notice to me or acknowledged my email back to him.
What should I do from here? I did send a certified letter stating their responsibilities.
–Lori
Dear Landlady Lori,
What does your lease say about early termination?
Do you have last month’s rent, or is that still owed to you?
Do you have a security deposit?
It’s good that you sent a certified letter stating tenant responsibilities. Everything is different now with the pandemic.
I would talk to the tenant, in person, if that makes sense, and find out why they are leaving (did they lose their employment, etc.) and let them know that you will try to rent the property for their last month, to remove that responsibility from them.
I would also try to determine a firm date for when the tenants will vacate. Then you can have their assurance that you can freely show the property to potential tenants and hopefully rent the unit.
Your lease will ultimately control tenant responsibility. Try to maintain a good relationship through this bump in the road.
Sincerely,
Hank Rossi
Landlord Hank says try and maintain a good relationship with this tenant through this bump in the road if you can and be sure your lease says what it needs to say.
Landlord Hank Rossi says tenant utilities should be connected by the tenant before move in day.
Ask Landlord Hank Your Question
Ask veteran landlord and property manager Hank Rossi your questions from tenant screening to leases to pets and more! He provides answers each week to landlords.
This week the question for Ask Landlord Hank is about a non-refundable pet deposit and support animal. Remember Hank is not an attorney and is not giving legal advice so check your local ordinances.
Dear Landlord Hank: Can a landlord charge a non-refundable pet deposit if the animal in question is not classified as a pet, but as a support animal?
-Frank
Hi Frank:
In Florida, no-pet rules don’t matter for legitimate emotional-support animals.
A tenant or applicant must have real documentation stating that applicant is disabled, that the disability affects a major life function (and what that function is), and how the animal reduces the effects of the disability.
If an applicant or tenant provides fraudulent information or documentation, he or she is committing a 2nd degree misdemeanor with consequences.
Also, even if the animal has been classified as a support animal, the animal must be required by the tenant.
Lastly, the provider producing the documentation for you must have personal knowledge of the tenant (this means an online certificate won’t work) and be knowledgeable in the area of the tenant’s disability.
In other words, a podiatrist can’t say you need an emotional support animal for psychological issues.
Sincerely,
Hank Rossi
Landlord Hank says, “A tenant or applicant must have real documentation stating that applicant is disabled, that the disability affects a major life function (and what that function is), and how the animal reduces the effects of the disability.”
Ask Landlord Hank Your Question
Ask veteran landlord and property manager Hank Rossi your questions from tenant screening to leases to pets and more! He provides answers each week to landlords.
Ask the attorney is a new feature we are starting with attorney Bradley S. Kraus and this week the question is about notice to vacate rules. If you have a question for him, please feel out the form below.
The first line of Yvonne’s question stated that she has month-to-month tenants who have been living in the property for two years.
That (likely) means their tenancy is after the “first year of occupancy,” requiring either (a) cause or (b) a qualifying landlord exemption under ORS 90.427 to terminate the tenancy.
Prior to Senate Bill 608, a landlord could serve 60-day no-cause notices. The passage of that law dramatically curtailed the no-cause rights of Oregon landlords.
It’s important to note a couple things as well: (a) current eviction moratoria must be analyzed, so these answers are not to be taken in a vacuum, and (b) local jurisdictional rules may apply to your particular situation.
Sincerely,
Brad Kraus
Bradley Kraus, Portland attorney
Brad Kraus is a partner at Warren Allen LLP. His primary practice area is landlord/tenant law, but he also assists clients with various litigation matters, probate matters, real estate disputes, and family-law matters. A native of New Ulm, Minnesota, he continues to root for Minnesota sports teams in his free time.
Ask Attorney Brad
Please enter your rental housing management question below for Ask Attorney Brad Kraus. Unfortunately he cannot answer questions from tenants.
Wish you had been more proactive in your rental property maintenance when you get that maintenance call or text from a tenant? The maintenance checkup this week provided by Keepe helps make sure you are your protecting your investment and income as well as your tenants.
Many property managers and landlords deal with maintenance in a reactive manner. They wait for tenants to report maintenance issues and/or waiting for the property to turn over before addressing maintenance issues.
This is natural because if you view rental properties as a pure investment, then maintenance is the cost center. It is a negative charge on investment income. The human tendency is to be proactive about positives and to be reactive about negatives.
Do you ever turnover a rental property and think, “I would have taken care of that if I knew it was broken?”
I’m sure it has happened to the best of us.
Here is an example from our experience. One tenant used a plastic fork to prevent the microwave from running constantly because the open/close latch was broken. Rather than reporting it, the tenant chose to ignore (or even worse, hide) it. A new microwave can run a couple hundred dollars plus the cost of installation, but can be well worth the cost. When things start to break, it affects the overall quality of the home and can have a negative effect on tenant satisfaction and quality.
Why keep up with rental property maintenance? Because it:
So how do you make sure your rental property is properly maintained? Here are a few suggestions:
1. Provide tenants with information when they move in
Outline what types of maintenance issues to bring to property management versus what they are responsible for.
Examples: Changing light bulbs are generally the responsibility of the tenant. A broken appliance is addressed by property management. Water leaks or floods should be reported right away to property management. Is there an emergency number? Provide it to them when they move in, so they know what to do in an emergency maintenance situation.
2. Maintain a checklist of items and the frequency to inspect
For example, roof and siding might only need to be checked every two to five years depending on age and type, but tile grout should be sealed annually. Keeping up on external paint can help prolong the life of siding.
Maintaining a short-term/long-term maintenance checklist can prepare you for future expenses and help you take a proactive approach to address certain items during rental turns minimizing tenant disruptions during occupancy.
3. Maintain a communication cadence with tenants
It could be an annual inspection to make sure everything is in working order or it can be a bi-annual email/mail communication checking in to see that everything is in working order.
The check in serves two purposes: one, it lets them know that you are a proactive property manager and two, it allows you to stay on top of maintenance issues to prevent costly deferred maintenance.
4. Another idea is to send them an annual happy holidays card
This will let them know that you care about them as a property manager and open the lines of communication, so they are more likely to come to you if there is an issue.
There are many ways to implement regular rental property maintenance updates and check-ins. Whatever you decide to implement, know it will lead to low tenant turnover, maintain or increase the property value and prevent costly surprises down the road.
About Keepe:
Keepe is an on-demand maintenance solution for property managers and independent landlords. The company makes a network of hundreds of independent contractors and handymen available for maintenance projects at rental properties. Keepe is available in the Greater Seattle area, Greater Phoenix area, San Francisco Bay area, Portland, San Diego and is coming soon to an area near you. Learn more about Keepe at https://www.keepe.com
The Apartment Jobs Snapshot showed 10,224 apartment jobs were available, accounting for 34.8 percent of the broader real estate sector.
Seattle and Portland, along with Kansas City, Minneapolis, and Baltimore, had the highest share of apartment job openings.
This month’s edition highlights leasing consultants, with market salaries in the 90th percentile reaching $34,047.
The demand for skilled leasing consultants was more than twice the U.S. average in Austin, Houston, Orlando, Dallas and Nashville.
In addition to requiring typical leasing skills, employers are seeking experience with Yardi Software, Microsoft Office, Microsoft Excel, and computer literacy skills.
Apartment industry jobs
The NAA says on their website, “The apartment industry offers a wealth of meaningful career opportunities that use a variety of skills and capabilities. Regardless of whether you are graduating from high school or college, leaving the military, or switching careers, the industry has a job that’s just right for you.”
National apartment association jobs report background
“Our education institute is a credentialing body for the apartment industry. They hear often that one of the biggest problems keeping our industry leaders up at night is the difficulty in finding talent, attracting talent and retaining talent,” NAAEI’s Paula Munger said.
So NAA partnered with Burning Glass Technologies. “They have a labor-job posting database that is proprietary,” she said, and they can “layer on data from the Bureau of Labor Statistics (BLS). We looked at that and thought we could do something that is really going to help the industry and help benchmark job titles and trends as we go forward.”
The maintenance check up this week, provided by Keepe, asks whether your rental housing may be a target for unwanted bird nests.
You wake up on a Saturday, make yourself some coffee and a bagel, open up the newspaper and start reading. Suddenly, you hear the dreaded beeping of your phone.
It is the tenant at your rental property complaining about bird poop all around the front porch and backyard.
A bird family has set up nest inside the vent. Your tenants can’t use the microwave oven or the vent fan for fear of hurting the little hatchlings. You decide to call bird control to remove the nest.
But one thing weighs on your mind – you really don’t want to hurt the birds or their babies. Maybe they will just fly away in a few weeks?
Bird nests common in the Northwest
This is an all too common scenario in many parts of Seattle and the Greater Northwest. It may be time for a maintenance check up to focus on nests.
Migratory birds (robins, tree swallows, tanagers, etc.) nest during late winter and early spring. With loss of habitat, and low winter temperatures, birds have begun nesting inside the warmer confines of household dryer vents. This keeps them safe from the extreme climate and allows them to prepare for the arrival of their hatchlings.
While it is easy to fall in love with the notion of sharing your home with other harmless living beings (in some eastern cultures, a bird building it’s nest in/around your home is considered a good omen), there are numerous downsides to letting this happen as well.
The obvious ones are visible bird droppings (aka bird-poop), and loud noises. Newborn birds often die and are abandoned in the vents causing serious odor problems throughout the house. Even worse, these nests can become extremely dirty and be a haven for lice and bacteria.
Maintenance check up: Install bird guards over vents
The best solution for this problem is prevention.
You can get a bird guard installed on your dryer vents. These are widely available on Amazon or any home department store like Home Depot or Lowes. Bird guards cover dryer vents and prevent mother birds from nesting in dangerous environments.
If you are unable to install it yourself, then ask your handyman or maintenance provider to install it for you.
October and November are the best times to do a maintenance check up and be proactive about installation so that you don’t have to clean up after the birds have already set up nest, or even worse, after the hatchlings are born.
This allows the mother bird time to find a nest in a tree or somewhere else where they won’t be disturbed.
About Keepe:
Keepe is an on-demand maintenance solution for property managers and independent landlords. The company makes a network of hundreds of independent contractors and handymen available for maintenance projects at rental properties. Keepe is available in the Greater Seattle area, Greater Phoenix area, San Francisco Bay area, Portland, San Diego and is coming soon to an area near you. Learn more about Keepe at https://www.keepe.com
