Friday, September 4, 2009
The most important factor in selecting tenants is of course their ability to meet their financial obligations and to pay their rent. Unless full-time students work part-time it is important to understand that the vast majority of students do not have the means to pay their rents. Thus it is critical (and a prerequisite for renting Kaur Property Management run buildings) that parents serve as co-signors and fully comprehend that they will be held legally and financially liable should their children default on the rent. It is advisable to have a separate agreement annexed to the lease that clearly explains this and that is signed by each tenant’s parent.
In cities with a large student population from outside the city and country, it is imperative that landlords or managers speak with the co-signors and briefly explain them the finer points of rental law in your province or state as they may be unfamiliar local laws.
Student tenants are not ones that allow owners much hands-off effort, that is to say, they can be quite a handful. They can be forgetful, extremely messy and sometimes, downright irresponsible. It is essential to complete a pre-move inspection with all student tenants to ensure that responsibility can be rightly placed should there be any damage beyond basic wear and tear. If your jurisdiction allows it, collecting a damage deposit would help mitigate any potential losses once they move out. Be certain that arrangements are made and clearly communicated when the students leave town for Christmas break or summer holidays. Often the fact that rent is payable on the first of the month gets neglected during the summer.
Although, not all students have behavior unbecoming of a good tenant, it is important to understand that the following scenarios are certainly within the realm of possibility. Young students, away from home for the first time may experience high alcohol consumption and perhaps even recreational drugs. We have managed buildings where the stench of marijuana it seemed was an every weekend occurrence. You can certainly insert clauses in your lease forbidding this behavior in the apartment but one must also understand that kids will be kids.
Monday, August 10, 2009
Often friends and family ask why people would need a property manager if owners can do the management themselves especially for properties with not many units? My answer is usually a succinct “because it makes perfect sense”. Even in cases when property owners area able and willing to manage their own investment properties, it is financially and logistically wise to hire a competent property manager.
Investing in real estate, apart from one’s home, is a tremendous investment opportunity for several compelling financial reasons. Real estate historically is an investment vehicle that remains always relevant, valuable and important. The simple adage “everyone needs to live somewhere” is most certainly true. A property in a good location and in good condition is always a good investment that can provide rich income for years and capital gain potential. Furthermore, from a tax perspective, an investment property brings many advantages that must be leveraged and taken advantage of.
Canadians often complain that our neighbors south of the border receive many tax advantages such as the ability to write off property taxes and interest expenses on mortgages which present huge financial advantages. Despite most people’s misconceptions, these advantages certainly do exist for Canadian properties provided that the property is indeed an investment property and not one’s personal residence. One can write-off mortgage interest expenses, property taxes, repair and maintenance costs and of course property management costs.
For the large scope and amount of work that a property manager performs, it makes perfect sense to employ them. One must contemplate how much their comfort is worth. They must think what value does someone who manages potential headache (repair calls at any hour) bring? What value does a manager who oversees projects, tenant showings, rental board proceedings bring? The answer is “a lot of value”. Factor in the reduced stress and improved quality of life that a property manager presents and it is quickly clear that not having a property manager would be a severe hindrance to the investment and the owner’s quality of life.
When one factors in the added advantage and ability to deduct the expense from the propertie’s income at year-end, the decision to employ a manager is a no-brainer!
For all your property management needs, contact www.kaurpropertymanagement.com .
Saturday, July 25, 2009
As a big history buff, I often quote the lessons of pre World War II when it was established that foreign policies of appeasement are a failure especially towards aggressors. As a property manager, I learned to follow similar thinking when dealing with tenants that are aggressive towards building management, superintendents, their neighbors and others.
In other words, often, negotiation with these types of personalities is a fruitless exercise. Recently, I secured a judgment and a writ of eviction against a tenant that had not paid their rent for several months. A very mean-spirited individual this person had convinced me that if I didn’t go through with the eviction he would become the model tenant that I was seeking and pay all amounts owed. I obliged and did not go through with the eviction.
In subsequent months, this tenant started paying his rent but his behavior was becoming more disturbing and potentially financially ruinous to me. As new tenants moved into the building, he would often cause problems with these new customers and start quarrels and arguments with them over petty issues such as distance parked between his SUV and the new tenants cars. It got so bad that once a new customer called crying due to the stress that he had caused her.
He started a similar confrontation with a second tenant that caused the new tenant to seriously question her choice in selecting our building as a place to live. At these incidents, I learned my lesson and decided that the only course of action would be to finally without reservation go ahead and evict the individual in question. Even though he had now begun to pay his rent on time, there was no excuse for disturbing new customers and new neighbors entering the building – new tenants that I had invested considerable time and effort in attracting to the building.
Wednesday, July 8, 2009
Many years ago, my parents relocated from Montreal to Toronto due to my father’s work which was with the Federal government. At that time my parents owned two buildings - - both triplexes. Due to several factors such as the then weak real estate market, their uncertainty whether Toronto would prove to be a good home as well as other factors made them decide not to sell the properties.
After several months of trying to manage the buildings from Toronto (600 km away) they saw that the great challenges of doing so proved much too large to overcome. They had no network of friends or family willing to help nor were they willing to ask for this magnitude of favor from them. Professional property managers that they contacted either wanted to charge exorbitant rates or simply flat-out refused managing anything smaller than 10 unit buildings. There was indeed a tremendous market need immediately identified by my father.
As Kaur Property Management was launched in Montreal, Quebec, its goal was to meet the needs of property owners that had relatively small investment buildings to be managed honestly, professionally and with little effort for the owners, who likely were out of town. It was said that Kaur Property Management would be like those trusted friends or families that did not exist or that were not asked to help manage the buildings.
Today, we manage several properties big and small for owners that live in Montreal or away. Our owners understand that they have made the right choice in selecting our services. We are a small company and choose to remain small to continue to manage the needs of our customers with quality and care. No task, no job, no matter the complexity is too big for us to manage.
Our full service package ensures that owners have a reliable resource to entirely manage every aspect of the property from rent collection, repairs and renovations, finding new tenants to end-of-year tax slip preparation and renewal management. This is what we desperately needed so many years ago. This is now who we are.
Wednesday, July 1, 2009
One of the most critical functions when selecting a tenant is to determine to the best of your abilities the quality and character of the potential tenant interested in your property. The more information you can collect prior to admitting the tenant the better one can gauge the suitability and fit of the tenant.
Lesson #1 - - When a claim sounds too good to be true, it almost always is.
Recently, a polite young woman came by to visit an apartment of mine. My suspicions about this person were raised early on when she stated that she would most certainly rent the apartment before even seeing it.
Nonetheless, I allowed her to come see the apartment. She liked it and decided to fill out an application with her work history and personal references. Below were tell-tale signs of her dishonesty.
- When I asked her follow-up questions regarding her application, she got agitated, rushed her speech and proclaimed “well, I have several other places I can chose from you know”
- The company at which she claimed to work at had no Internet search results returned.
- She did not leave a deposit which I make a requirement if folks are interested in renting and when they are given an application to fill.
Lesson #2 - -Be extremely vigilant about people and the information they provide
Despite the lack of deposit, I decided to do a little detective work to uncover my suspected untruths. After receiving an excellent reference from the person she had marked down as her boss, I asked one of my co-workers to visit the exact address of her place of employment on her application. It turns out that not only did business suite number not exist, but no such business was located at that particular building in downtown Montreal. I called the applicant back to reconfirm the address. She once again confirmed which led me to challenge her claims. At this, she got very agitated and exclaimed that she was at work and could not be bothered at this time. My decision was immediately made to reject this applicant.
Lesson #3 Credit Checks are critical
People with skeletons in their closet have reasons to hide this information. They may have had problems in the past meeting rent payments; they may not work, in summary, lacking the specific requirements you have set out. Avoid future headache by investing the time to research their history. Credit checks are very important as well. If a person has had issues paying relatively small credit card bills, there is a high likelihood they will have trouble paying rent.
Share your comments!
Monday, June 29, 2009
Last week a dear old lady moved out from one of my 2 bedroom apartments. The sweetest lady, she rarely complained, always paid on time and was like everyone’s grandmother in the building. However, the sweet grandmother image I had of her quickly faded into one of the Wicked Witch when we inspected her place after her departure! It was as if she put on her coat, took one last look of her apartment over her shoulder and literally walked out of her apartment.
Everything, and I mean everything was left - - furniture, carpets, kitchenware, bathroom ware, clothes, old stereos, blinds, chairs, tables, pictures, etc …..
More bad news for us, the condition of the apartment was horrendous! Every wall it seemed had a dozen nails with a different grandchild’s picture hanging. Even though she had lived in the unit for only 2 years, the walls were filthy dirty, the hard wood floor was scratched and the light fixtures were either missing or broken. In Quebec, collecting a security deposit is illegal so many of us owners get put in a financial bind with situations like this.
My team spent two hours removing and throwing her junk out of the apartment. Now starts the much-needed renovations to get the place on the market.