1. Don't rent to anyone before checking their credit history, references and background. Haphazard screening and tenant selection too often results in problems--a tenant who pays the rent late or not at all, trashes your place or moves in undesirable friends--or worse.
2. Get all the important terms of the tenancy in writing. Beginning with the rental application and lease or rental agreement, be sure to document important facts of your relationship with your tenants--including when and how you handle tenant complaints and repair problems, notice you must give to enter a tenant's apartment and the like.
3. Establish a clear, fair system of setting, collecting, holding and returning security deposits. Inspect and document the condition of the rental unit before the tenant moves in to avoid disputes over security deposits when the tenant moves out.
4. Stay on top of repair and maintenance needs and make repairs when requested. If the property is not kept in good repair, you'll alienate good tenants. And they may have the right to withhold rent, sue for any injuries caused by defective conditions, or move out without notice.
5. Don't let your tenants and property be easy marks for a criminal. You could well be liable for the tenant's losses. Landlords are sued more than any other group of business owners in the country. The average settlement paid by a landlord's insurance company is ,000, and the average jury award is .2 million.
6. Respect your tenants' privacy. Notify tenants whenever you plan to enter their rental unit, and provide as much notice as possible, at least 24 hours or the minimum amount required by state law.
7. Disclose environmental hazards such as lead. Landlords are increasingly being held liable for tenant health problems resulting from exposure to environmental poisons in the rental premises.
8. Choose and supervise your manager carefully. If a manager commits a crime or is incompetent, you may be held financially responsible. Do a thorough background check and clearly spell out the manager's duties to help prevent problems down the road.
9. Purchase enough liability and other property insurance. A well-designed insurance program can protect your rental property from losses caused by everything from fire and storms to burglary, vandalism, and personal injury and discrimination lawsuits.
10. Try to resolve disputes with tenants without lawyers and lawsuits. If you have a conflict with a tenant over rent, repairs, your access to the rental unit, noise or some other issue that doesn't immediately warrant an eviction, meet with the tenant to see if the problem can be resolved informally. If that doesn't work, consider mediation by a neutral third party, often available at little or no cost from a publicly-funded program. If your dispute involves money, and all attempts to reach agreement fail, try small claims court where you can represent yourself. Use it to collect unpaid rent or to seek money for property damage after a tenant moves out and the deposit is exhausted.
INVESTING IN REAL ESTATE
Investing ... in Real Estate One way or the other, one kind or another , "Real estate investing is always about the numbers, never about the wallpaper." - Larry Lick
The most viable investment available that involves possible tax incentives is still real estate. There is seldom reason to fear a downturn, the return can be substantial, and property that is purchased right and pro perly cared for will almost always appreciate in value .
Income property investments are typically held for long-term gain , as well as a hedge against inflation. Real estate investors actually profit from inflation because with a 30% equity, just a 3% inflationary increase in property values results in a 10% return on investment. Without even considering normal operating profits and tax benefits! See the RHOL page on Using Leverage in Real Estate Investing .
Real estate can be purchased in many forms , including: shopping centers, industrial buildings, warehouse net leases, apartments, single family residential housing, and even raw land. The investment can be direct, or through various kinds of partnerships and investment trusts.
A Ready-Made Transaction Checklist
Send a copy of this checklist to the buyers' representative to track dates and approve any deadlines you have set.The basics:Address of propertyMLS numberDate of saleTarget closing dateNames and complete contact info for: BuyersSellersBuyers' attorneySellers' attorneyCooperating broker(s)Closing officerLenderTitle insurance companyAppraiserHome inspectorOther inspectors (termite, lead paint, radon) required by contractSellers' Progress ChecklistGive the sellers a checklist to track their responsibilities during the transaction.
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Initiation Date |
Target Completion Date |
Actual Completion |
| Preliminary title report |
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| Satisfaction letter from lender |
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| Utility readings and payments |
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| Right of first refusal (for condos) |
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| Home warranty policy (if applicable) |
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| Repairs completed (list each separately) |
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| Prepare deed (attorney) |
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| Arrange for payment of transfer taxes (attorney) |
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| Set closing date |
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HOME BUYERS: How To Avoid Costly Mistakes!
FREE REPORT # 1 From Kelley BredellThere are some simple steps that homebuyers often miss when looking for their new home. Taking the time to consider these steps can save you thousands of dollars, but more importantly, can smooth the process of buying a new home, saving time and money, as well as alleviating stressful situations in advance.
Begin by being up front and honest with your REALTOR and lender about your credit history.Your credit, whether good or bad, affects everything from your down payment to your interest rates.
Your REALTOR or a professional mortgage consultant can often advise you as to how you can get credit problems cleared up or completely eliminated from your credit report
before you apply for financing or make an offer on a new home.
Getting pre-qualified for a loan by a professional lender before you begin your search for a new home will allow you to know in advance exactly what kind, and how much, mortgage you can afford. This makes it possible for you to make an offer on your new home with confidence that enough funding is available.
If the seller does not offer a home warranty on the house you want, ask your
REALTOR to make it a part of the written offer that you make.
A home warranty can save you thousands of dollars in repairs, and can often be obtained for a very nominal annual fee.
A standard warranty covers the electrical, plumbing, heating and air conditioning systems as well as major home appliances.
Ask your
REALTOR for a
market analysis of the home, in comparison to similar homes in the neighborhood or throughout the city, before you make an offer.A home is not just a place where you live ' it is also an investment.Take the time to view several homes before you make an offer so you know exactly what is on the market.
Be certain you are making a wise investment.
Make your offer contingent upon a home inspection and ask the seller to make the required repairs.
Hire a professional to inspect every aspect of the home thoroughly.
This can save you thousands of dollars in costly repairs and many headaches in the future.A good inspection can also allow you to negotiate for any repairs prior to closing.If the seller is not willing to make the necessary repairs, remind them that the lender will also require the home to be in good condition before they make a loan for the purchase.
Take into account your present homeowner or renter status. If you already own a home and must sell it before you buy a new one, it is best to get a
REALTOR to do a complete market analysis on your present home.
This allows you to know how much you can sell your current home for before you make an offer on a new one.
If you are leasing or renting, the lease's expiration date will give you a timetable for your new purchase.
Review this with your
REALTOR well in advance of when you want to move.
Choose your agent wisely. Working with a full-time professional real estate agent is a must. Ask questions of your agent.
Find out how knowledgeable he or she is about houses currently for sale in your price range and also of houses that have recently sold.
Can your agent recommend a good lender that has the reputation of excellent customer service and low rates?
Does your agent ask questions of you to have a full understanding of what you are looking for and to help you get the most home for the money?
Thank you for requesting a copy of this
'FREE REPORT'For prompt, courteous, professional service, call Kelley Bredell:
1-951-271-3000
1-866-953-5599 (866-9-Kelly-9)
Visit my web site at:
www.homesbykelley.comHave questions, need advice you can count on or just want to discuss this further? Don't waste any more time; pick up the phone and call me now! I'm here to help! I appreciate you as a client and a friend. I appreciate your business, your loyalty, trust and your referrals. It is my goal to provide the very best counsel, advice and service possible for your real estate needs. If I may ever be of assistance to you, a relative, friend or co-worker please don't hesitate to call me. I look forward to the opportunity to serve you.
