Almost everything in life has a cycle: the days of the week, the changing seasons, and even real estate investing. So let’s explore the lease lifecycle, which sets the pace for every landlord’s business, and the four stages where you may differentiate your real estate investment.
Explanation of the 4-Stage Lease Lifecycle
The lease lifecycle is the regular cycle that happens between each renter that resides on your property. The property is initially unoccupied. After that, you fix up the home and post it on the market. Next, you’ve discovered the ideal renters, and they’re getting ready to move in. Finally, the renters move in, pay their rent, and make the property their home until they are ready to go.
That is, after all, the goal.
Remember that many technological solutions are available to assist new (and seasoned) landlords in navigating this procedure with ease.
Stage 1: Vacancy
There are various boxes to check once renters have moved out before the property is ready to present to new tenants.
Landlords are responsible for building maintenance as well as tenant safety. One critical aspect is to ensure that you are following construction codes. These can differ by state, so make sure to check your local regulations.
Sanitation and garbage disposal
Check the garbage and sanitation schedules twice before renting your home. What days of the week is garbage collected? What additional information do renters need regarding the property’s regular cleaning and sanitation? Ensure that these parameters are clearly stated in rental agreements and in your onboarding correspondence.
You should evaluate your property’s utility condition between renters. If you are handling utilities as the landlord, double-check that all meters are operating properly and that there are no leaks. Even a minor leak might be expensive in the long term. You should also ensure that fast internet is available in your location. While you will rarely pay that fee as a landlord, it is a necessary utility for the majority of tenants.
Many prospective renters place a high value on security. Before renting out any property, ensure your system is up and running. Are all cameras recording properly? Do the doors to communal spaces automatically lock and close? You may even emphasize in your rental ad if your house offers security that goes above and beyond what is anticipated in your community. Security sells itself!
Areas in Common
Widespread spaces are more common in multi-family residences and should be inspected and maintained. Is everything clean and ready for the new tenants? Do the washing machines function properly? Is the exercise equipment kept in good condition? Is a new filter required for the pool? Ensuring regular maintenance is performed between renters is essential.
Make sure your rental property is in top condition both inside and out. A terrible first impression may be challenging to overcome, so invest some time and money in ensuring your house has that sought curb appeal.
Every listing should include current photographs that accurately depict your home. This is an opportunity to collaborate with local photographers who can promote your listing on various networks. You can also opt to engage with one photographer exclusively and negotiate cheaper pricing for bundled jobs.
Make an effort to stage the property before hiring a photographer. The presence of furniture in the images makes the property appear more pleasant and allows potential renters to envision themselves living in the place.
Stage 2: Listing and Promotion
It’s time to list the property once you’ve repaired, cleaned, and prepared it. Make sure you use best practices to find a renter and set your rent at a fair rate.
Requests for showings will begin to pour in once you have a well-written listing on your side. Two common methods for showing a property are open houses and individual showings. You are not required to choose between the two. Both alternatives offer advantages. Use virtual showing software and related technologies to get as many eyeballs on your property as possible while avoiding the time commitment that traditional showings need.
Finally, you will have a collection of tenant applications to evaluate. Along with a background check, you’ll want to rapidly get to know each candidate by conducting an introductory interview (either over the phone or in person), so you can locate the best potential renter for your home. Even if you’re in a hurry to rent your property, following this step is critical to avoid problems later on with renters who aren’t a good match.
While you may have an adverse reaction to some of the applications and wish to delete them instantly, ensure you aren’t discriminating against candidates by adhering to specified legal criteria.
Stage 3: Moving In
When you’ve narrowed down your perfect renter among all the applications, it’s time to put it in writing. You should only contact other applicants to inform them that the property has been rented once all documentation has been signed. You never know who you’ll need as a backup, and no one wants to hear that they weren’t your first pick.
You may confirm the tenant’s move-in date, give any extra pre-move-in details, and hand over the keys after the lease is signed. While particular advantages should be made evident in your initial marketing, the lease review and signing process is also an excellent time to discuss your rental rules, renters insurance, and other tenant-landlord requirements.
It’s finally here: move-in day! Consider welcoming new tenants with a “Get to Know the Neighborhood” gift or a booklet of useful renters’ information that includes some local coupons or restaurant recommendations to get your tenant-landlord relationship off to a good start.
You should also ensure that your renters have the best phone number and contact information to reach you in an emergency. Of course, if you’re too busy sprucing up another house or working on another project, a property management firm may handle all move-in responsibilities for you.
Stage 4: Renter Occupancy
The occupancy stage of renting your home is the easy part. You sit back and collect rent. Well, not quite. Relationships with existing renters still require care and attention. By adhering to these four golden guidelines, you will be able to keep them happy and avoid the majority of typical sources of dispute.
Tenant Occupancy’s Four Golden Rules
- Communicate early and often.
- Respond quickly.
- Set reasonable expectations.
- Maintain your attention and engagement without being intrusive or unpleasant.
Apply Property Occupancy Regulations
Landlords must execute several basic chores in relation to occupied buildings. Following the guidelines above makes each of them easier and more successful.
Receipt of Rent
Rent collecting does not have to be complicated or frustrating. Every month, you can do it from your phone in a matter of seconds. Consider these five options if you’re looking for the best approach to collecting rent on your home. Make things even easier by delegating rent collecting to a property management company.
- Collect rent online using
- Collect rent by mail
- Setup a drop-off location for rent
- Collect rent in person
- Hire a property management company
This is where many landlords go wrong. While you have the right to examine your home as much as you like, showing up every weekend is guaranteed to upset tenants. Respect their time and space by asking when it is convenient for them, informing them that the inspection is standard so that no one gets the incorrect notion, and stating how long you intend to remain inside the property. While it is your home or unit, it is also the home of your renter. It is critical to keep this in mind. Property managers can swiftly and professionally inspect, making residents feel cared for rather than invaded.
Requests for Rental Repairs and Maintenance
Regular maintenance and periodic inspections are significant elements of a landlord’s responsibility over a lease term. Maintenance requirements vary from state to state, so be sure you’re up to speed on local rules.
In general, a landlord is responsible for anticipating renters’ property-use demands. This covers both regular, scheduled maintenance and rapid repairs in the event of an emergency.
Using the four golden rules involves reacting immediately to repair requests, communicating early and frequently about scheduled and emergency repairs, and setting realistic expectations. Hence, renters know what will happen and when.
Furthermore, regardless of how busy you are with other commitments, take the time to accomplish these activities every six months to remain on top of routine maintenance and avoid expenditures building up:
- Replace the batteries in your smoke and carbon monoxide detectors.
- All air filters should be replaced. Even if they do not require immediate replacement, this will guarantee that your HVAC system operates at peak efficiency.
- Examine the property’s efficiency. For example, compare utility bills from the same month the prior year to see if they’re still in good functioning order. This is especially crucial if you include utility expenses in a tenant’s rent.
- Upkeep of the building. You don’t want to spend more than six months without an in-person inspection if you don’t visit the property frequently or live nearby. Once a month is ideal, but you may have a property that is difficult to see regularly. Check that communal spaces are clean, laundry units are in working condition, security is operational, the grass and garden are well-maintained, and the roof and gutters are free of leaks or weak points.
By developing a habit of discovering little problems via regular maintenance and inspection, you can avoid having to solve more significant (and more expensive) problems in the future.
Taking Care of Complaints
Handling tenant complaints is never simple, so you should do everything you can to avoid them as much as possible. The fewer complaints or requests you receive from your renters, the fewer they will have about you. Take care to tread the fine line between keeping your property safe and comfortable for all occupants while not micromanaging or intruding on their daily life. Giving individuals space to live their life goes a long way toward keeping rent coming in and your home manageable.
Of course, you should intervene if you see anything that would reduce the value of your property. What about new pets? Is there a newcomer? New indoor smoking habit? These are topics worth discussing with your tenants.
While no one likes confrontation, as long as you reply quickly and communicate properly, you’ll be able to get through it without any issues.
While the aim is to have your home occupied and rent checks coming in, you must occasionally face the music. There comes a time in the lease lifecycle when you may need to address lease infractions, which might result in the loss of a tenant.
You may prevent these uncomfortable events by adhering to the four golden rules of fast and clear communication and realistic expectations.
How to Increase the Rent
At the end of each leasing cycle, it is time to renegotiate. Will the renters remain or leave? Will you have to raise the rent if they stay?
Tenants usually expect rent increases to keep up with inflation, even if just a little. However, keep in mind that price gouging is illegal in most states. So when creating a new lease for current renters, be sure you are within your rights.
Simplifying Your Lease Lifecycle
Following the four golden rules above simplifies your life and keeps your tenants happy, resulting in fewer vacancies. After all, keeping the fantastic tenants you already have is the simplest way to progress through the lease lifecycle.
The four-stage leasing cycle can be simple and easy. With practice, you’ll be able to keep the cycle going smoothly. Hiring a property management company to lend their knowledge and remain on top of the day-to-day is the most cost-effective method to keeping your property occupied.
It all boils down to making each stage of the lease cycle speedier and more suitable to tenant demands. That is where professional property management expertise comes in. With a trusted partner managing the leasing lifecycle, your investment will have the opportunity to mature and grow over time.
At Real Property Management Consultants, it is our goal to ensure residential property management services that are stress free for our property owners. If you have questions on how we can help your business grow, contact us. We are looking forward to helping you!
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