When you are just starting out it is extremely helpful to look into and analyze a lot of deals. You quickly know which ones are the best so you can act quickly when they pop up! Understanding how to use the 1% rule allows you to filter out the potential bad ones almost instantly.

The 1% rule is the idea that you'll get 1% of the purchase price in monthly rental income. 

For example, if you buy a house for 100,000 you'll want the rent to be at least 1,000 a month. That is it. That's the rule.

This will cover your Principal Mortgage, Interest, Taxes, Insurance (PITI) but also cover your not as obvious costs like repairs, vacancy, capital expenditures (big ticket items like roof, HVAC, water heater, etc.), property managers, water, utilities, landscaping, etc. The 1% rule is thought of as a defensive measure and not necessarily added income to live off - unless you have reserves. 

If you want a real life example let's look at my second deal which falls into the 1% rule.

Purchase Price: $83,524
Monthly Rental Income: $900
Principal, Interest, Taxes, Insurance: $520 a month

That doesn't look like life changing money but seems like a decent return until you factor in saving for those other costs. In theory you’ll want to save at least 10% for vacancy, 10% repairs, 8-10% for management fees, and 5-7% for Cap Ex.

When you add in those added costs let's look at those numbers again. 

Purchase Price: $83,524
Monthly Rental Income: $900

Principal, Interest, Taxes, Insurance: $520 a month
Vacancy: $90
Repairs: $90
Property Management: $75 (that is the actual cost of mine)
Cap Ex: $60

Total Expenses: $835
Cashflow: $65

However, even with saving 25% if an AC unit goes out $250 a month isn’t going to do a whole lot.

The 1% rule is making sure your rental property will get 1% of the purchase price in monthly rent. This helps to quickly analyze whether a deal will be "good" or not. This will help to ensure that you have enough cash coming in to not lose the property if things start to go wrong. 

This rule isn't the end all be all of investing as buying homes in California, New York City, or the Bay Area may not make sense and people are still doing that. It should be used as a quick filtering tool to help decide whether you want to analysis a property further and I'll be working on a post to determine when is the right and wrong time to use it. 

If you are looking for more material on ways to begin real estate investing or analyzing a deal here are some books I recommend. 

​**This post contains affiliate links. If you make a purchase through one of my links, I will receive a small commission at no extra cost to you and allows me to keep the lights on around here. All thoughts and opinions are my own. ​​ ​

After 2.5 years of self managing I finally hired a property manager for my quadruplex and here are the questions I used to help find my property manager. ​

I started the process, as with most things, by doing a big overview of companies. I started looking at reviews online, both the positive and negative. If the negative reviews were tenants complaining about the property manager being strict on rent collection or enforcing rules that was actually a positive review for me. Because, no one will care about your property as much as you do but you want to make sure your investment is safe. 

​There are horror stories of property managers that rip people off, take security deposits, charge extra for repairs so I wanted someone I trusted. I first looked to see if they were licensed with the National Association of Residential Property Managers (NARPM). This is an added certificate that made me more comfortable with their education, ethics, and continued desire for improvement. I then looked if they had any association with the real estate investing resource BiggerPockets.com.  This might let me see how they interact with people or information they know and are sharing. Not a requirement but just something I checked. 

Once I had my shortlist I started to call around. As I talked to different companies I was also trying to get a sense of their personality. I was looking for someone, or a company that could provide someone who was

• Nice, but firm 
• Communicative, but not aggressive
• Detailed oriented
• Organized
• Calm 
• Truthful, but doesn't overshare
• Passionate about real estate investing

There are other things that go into being a successful manager but you get the jist. They need to be friendly enough to deal with a tenant and make them feel cared about but also able to control a situation. Finding a property manager that has all these skills will be a challenge but you want someone pushing themselves professionally towards these traits. Those are the ones that will keep your rental property occupied, meticulously maintained, and your tenants happy.

Below are the questions I used in my first initial 30 - 45 minute conversation with the prospective property managers. This is something they expect as I often asked one question and got answers to three different questions. They also sent their working agreement which you should read what you are agreeing to but will also answer several questions. 

1 . What got you started in the business/ how long have you been in business? ​Do you currently invest in real estate? 
You want to make sure they’ve been in business long enough to have a track record and they plan to stick around. It doesn't hurt to see if the company owner has ever managed a rental.  If they have never managed a unit what is the chance that he or she runs a company that can help with your investment property?

​I prefer to know the company’s leadership is investing in the real estate market themselves. If they don’t invest in your market they may lack the understanding they need to help you excel.

2. What do you find the most challenging/rewarding part and why?
This can give you insight into what areas they may struggle or you might need to give guidance on. If they mention how they find leasing a unit the most challenging part well maybe that isn't someone you want to hire or maybe you'll just help post ads or keep them refreshed. 

3. What are the attributes of their favorite clients?
You have an idea of how involved you want to be or not. If they want someone that they can run everything by but you hired them to distance yourself from the property that may not be a good fit. Or if they want someone who lets them do their thing and you want to know every detail that wont work either. 

4. What are your favorite type of properties to manage?
You will want to get a good idea if they only manage certain areas or properties. Also, if they don't like your type of property do you think it will be a priority? I ran into a company they did not want to manage my property because it is a quadruplex. 
​
5. How many properties are you managing? Do you manage both short-term and long-term rentals?
Property managers may be involved with managing short-term rentals, like Airbnb and VRBO. Short-term rentals are a totally different business and require a lot of time. Make sure they have the time to focus on your long-term rentals. 

You'll want to understand their size also. Too few rental units and they may be inexperienced or lost clients due to poor service. Too many rental units and you will get lost in the shuffle. A property manager with 200 to 600 rental units is a great number!

6. What are your fees? Do you charge a flat fee or a percent of rent? Do you charge during vacancy?
They will be ready for this question and will be laid out in the agreement to work with them. Some companies will offer a flat rate (price per door) and others will offer a rate based on the rent amount. 7 to 12 percent of rent is typical, but you may be able to negotiate a lower percentage depending on the circumstances. For example, if they will be managing multiple properties for you, they may cut you a deal. Both my property managers do a price per door which can be $50 - $75 depending on the number of doors.

Some people prefer paying for a percentage of rents because they believe it will motivate your property manager to fill vacancies because they don’t get paid if you don’t have a tenant. It should also motivate them to fight for higher rents because this helps their bottom line too.

I personally have two property managers that are flat rate companies. I have not felt a lack of urgency on filling units because 'they will get the same pay no matter what'. I also haven't felt they try to make up for their low prices with other charges. I feel I tried to research the companies to understand their ethics and fundamentals from the beginning and if I ever started to question that I would begin to look elsewhere.

7. How long does it take you to turn a property around in between tenants? Will you advertise and show a property while it is occupied? 
If you are nervous about how motivated they will be to fill you vacancy this will help to see how fast they are. After the property is ready it should take 2-4 weeks. Any longer than this suggests the property manager is struggling to find tenants, any shorter than this suggests that your asking rent amount is too low and you might be leaving money on the table. Either of these scenarios is bad for you and your rental property.

From my experience it is easier to show a vacant unit from tenant coordination to general aesthetics of not seeing someone else stuff. 
​
8. What is your philosophy on getting properties rented? Do you try to get top dollar and raise rents aggressively or do you prefer more of a value play?
The rent amount is ultimately the owner’s decision, but if your property is outside of your local area, you will most likely rely on your property manager to know the market. It is beneficial if you and your property manager have similar philosophies on tenant selection and where to set the rental amount.

9. How do they determine rent amount? ​​
They should be able to complete a comparable market analysis of all the other available listings near your property. They should use properties that just went off the market and properties that are currently on the market to determine the highest possible rent. They should also factor in the unique aspects of your rental property, like a pool or a new kitchen. 

You can/should look up this information to have an idea and rentometer.com is a great way to do that. 

10. How do you list a property? 
Your property manager should be advertising properties through a variety of channels. If they are still just placing Craigslist ads and hoping for the best then you should steer clear.

11. What are your income and screening requirements for applicants? Do you look at credit and criminal background checks on prospective tenants?
If they don’t set a standard then how can they be sure this tenant will make rent? It should go without saying that a tenant needs to have enough income to pay the rent. Background, criminal, and eviction history are super easy to check these days and is a must. My property managers allow me to see things like credit score, income, criminal before making a decision. 

​12. What control do I have over the tenant lease agreement? 
Your property manager should give you some input into the lease agreement if there are one or two issues that are important to you. However, if you are putting in lots of additions, you should have just written it yourself. Make sure your prospective property manager is confident in the leases that they have written for tenants by asking this question. I checked on being able to switch between pet deposit vs. pet rent.

13. Do you have electronic and automated systems set up? How do you collect rent from tenants? 
These days, property managers should have client portals and electronic payment systems set up for convenience and record keeping. For example, is there an online portal where you can go to generate reports and see property accounts in real time (instead of waiting weeks for a monthly report)?

If your property manager isn’t having your tenants pay online that is a red flag for two reasons. One, it slows down the speed at which you can get paid. Two, it makes it easier for tenants to miss paying the rent. If payments are online, tenants can automate their payment and these two problems are avoided.

14. Do you offer direct deposit for your owners?  
Your property manager should be able to deposit your check in your account. This saves you time and effort, which is the whole reason you hired them.

15. Do you take photos of the property before and after move in and out? How often do you check in on tenants and properties? Do you do an annual walk-through?
They should take pictures as it easy to do and is critical should any disputes arise. A good property manager will also check in with the tenants even if they haven’t heard from them. Some tenants won’t report needed repairs, leaks, or damages for fear of being labeled responsible. It is important to have the units looked at so you don't get a surprise when the tenant moves out. ​

Your property is at risk if your property manager doesn’t conduct inspections. This could require a small fee and it will be one of the best investments you can make. It ensures you catch problems before they spiral out of control. They may also say they will ask handymen to report back but they should be doing an annual check up as well. 

16. Who keeps the damage deposits?
Most people will tell you not to let the property managers hold on it. Even though most people are honest and trustworthy, there are horror stories of property managers stealing the tenant damage deposits. 

17. What do you charge for evictions? Do you offer eviction warranty? 
Hopefully this never comes up, but it is better to know upfront than to be surprised if an eviction is necessary.

Some companies offer an eviction warranty. It is only a small fee, but it will give you major coverage should you need to evict a tenant. My property manager offered this for $150 a year per unit, so like $12 a month. 

18. Do you offer a tenant placement guarantee?
If the tenant is evicted or moves out before the lease is up, will the property manager find a new tenant for free?

19. Under what conditions can I cancel my management contract?
Never get locked into a contract you can’t get out of. If they are trying to hold you hostage with a contract how good do you think their service is? 

20. Do I have to sell my property with you if I want to list it?
Some property managers will ask you to sign a contract that forces you to sell the property with them. This just seems like a sketchy move to me and caught it in one of the agreements that was sent to me. They should offer the service but not require it. 

​21. How often will I get updates on my portfolio?
You should be able to come to an agreement that you feel comfortable about your property. This is your business and you should be able to get updates as you want. 

22. Do you have references?
Ask for both current and former clients, and actually call them. You may not have the same experience as them but will still be helpful. 

This seems like a lot to ask, and it is, but that is the point. This is your business and investment and you want to make sure it is taken care of. These questions should provide you with a clear indication on whether you and your prospective property manager are on the same page and will be a good fit.

Hopefully this helps and happy property manager hunting! If you have any questions you think are also important let me know.

The property is in a C location, which is a fancy way of saying that it's in a working class neighborhood with older homes. I have a hard knowing what are necessary upgrades for that area while still trying to salvage what I can. I was saving over 75% with my house hack  and budget but I also replaced 3 HVAC systems on top of these rehabs and it was all getting expensive! 

​My network of other real estate investors that I can lean on isn't the best which meant I started my search for a contractor the same place as everything else, Google. 

I looked for positive reviews and eventually had 3 people come out. One person gave me an estimate but it was slow and communication was slower. The second group didn't give me an estimate and never responded to any communication. The last person I spoke to said his company had a 3 month waitlist away but he flips houses on the side and he has a crew that may be able to help.

I had no idea what to expect price wise for a job like this. I knew how much floors and paint would cost but this was something totally different. I knew it was going to be expensive but I was a little shocked when the first estimate came back over $27,000 (which included materials). That's twice what I paid to even buy the place!  If you are interested in what that estimate looked like here it is. Prices may be different in your area but I would have found seeing this stuff super helpful. 

After seeing that I reached out to guy that flips houses. He said he thought his guy could do each bathroom for $2500- $2800 so I figured it wouldn't hurt. Honestly I was just hoping it'd be cheaper than this!

​He gave me a rough verbal quote of about $8,000 in labor and I would need to purchase and provide materials through out the process. I was a little hesitant on why it was so much cheaper but was fine purchasing the materials since I was trying to get my Southwest Companion pass and I needed the spending!

I double checked previous work that had been completed and it looked nice. He said I was able to pay him as work was completed so at this price I figured I would give it a shot!

​I did run into a hiccup and needed all my pipes replaced which changed my price a little bit. I did replace some windows prior to him coming to do the work and his demo wasn't apart of his estimate. Here are the final numbers for what it cost me to complete the full rehab.

Summary
This experience was a really good learning experience for me. I had no idea what the cost of a rehab this size would be or how the little things like outlets and hinges add up! I learned that when you are responsible for providing the materials it is a lot of running around to get bathtubs, finishing nails, outlet covers, and so much more.

This experience was a nice transition into working with contractors, seeing what things cost when you don't do it yourself, and will come in handy when I try to BRRRR in the future.  

​If you want to see what all this money bought me I have a before and after video here. 

The way to get all this money tax free is to successfully complete a live in flip. The way this works is the Internal Revenue Service (IRS) has implemented Section 121 - Exclusion of gain from sale of principal residence . If you want to read the full 16 pages document from the IRS you can here. 

The general jist is you can sell a property you lived in for 2 out of the past 5 years and keep up to $250,000 of the profits if you are single or $500,000 if you are married.

The two years do not need to be consecutive either. You can live in it for one year, live somewhere else for three years and then come back and live in the property for a year and that works also. Doing all of that somehow qualifies as a primary residence. Whatever works!

You'll need to find and purchase a house that is in rough condition. Understandably this isn't the most ideal situation to be living in but if making this much money was easy everyone would do it!

The wonderful thing about living in the house is that you can put less money down. If you are going to try and do a live in flip you'll want to do either the Federal Housing Administration (FHA) loan where you can put down 3.5% or the conventional 5% down. The reason you'll want to do this is because the less money you put into the deal the more you can get back in a return! And obviously if you have a higher mortgage for 2 years that may not be the concern if you'll make a bunch of money on the back end. 

Now that you have your new run down house for a low down payment you'll need to start creating equity and there are three ways to do this. 

The first option is to rehab the house. The house you bought is in terrible condition and if you need an example of what it might look like take a peek at my deal 3.  That house is run down and just needs to be updated but the bones are good which makes it ideal. Other people buy homes that have been exposed to damage like a fire or flooding to create wealth but in this instance of you living it in if you want bank financing  and it'll be hard to get that if it is in that bad of condition.

You can obviously do the work yourself or hire it out. This goes without saying but if you do the work yourself it'll be cheaper for you which means a larger profit margin.

The second option is to create more livable space. This can be turning a den or an office into another bedroom. You can turn a basement into a bedroom and a bath. The reason you'll want to do this is because single family houses are based of comparables and typically the higher the bedroom count the more you'll be able to sell it for. Things to look for may be a two bedroom house that is over 1,000 sq ft might have space for an extra bedroom. Is there a carport that you can inclose to add a bedroom. How about an extra 10 feet between the current house and the fence. You'll need to be creative to see and create value that is not currently there. My deal 2 is a good example of this. The house not only has a den but it also has a basement that I can easily add a bedroom/living space and a bathroom. 

The third option is combine the first two steps and create extra livable space while rehabbing the entire property. This will be your best option to create the most amount of wealth!

Summary
This process can be challenging because you may be borrowing money at a high interest rate, you may need to wait until you've saved enough, or you can pull equity out of your house. Either way you are either going to need to have a lot of cash or a comfortability with borrowing money. You will also gain a lot of skills to needed as an real estate investor like, managing a rehab, knowing after repair values, dealing with lenders, leasing a unit and more. But, if you are able to get one deal done you'll certainly get more experience for your next one, improve your process, and on your way to A LOT of money. If you are buying a house and refinancing out 90k of a 120k property you are gaining 30k in equity PLUS the monthly mortgage pay down and cash flow. Do a couple of these a year and you are creating over 100k in net worth. Once you've become more comfortable with your process maybe you borrow hard money or sell one or two of the properties and get 1-3 going at a time. ​

If they do ignore the bill, what are the next steps?

Step 1 - Had they paid rent?

No. My tenant hadn't so if they continued to stay in the unit I would have had to file an eviction.

If they had paid rent but are no longer in the unit I would reach out to them to try and better understand where they went. If they had paid their rent and still moved out they would still have the right to that unit so I wouldn't be able to rent it out yet.

I actually called and spoke to a legal assistant that said since they had left and turned over keys there was no need to evict at this point. 

Step 2 - Was the unit abandoned? 

No. One of the tenants met me at the unit to return his keys and do a final walk through. 

If the tenant had paid rent you'll want to be careful in how you determine whether they abandoned the unit or not. If it is obviously they moved across town you need to secure the unit and fill it as soon as possible. But if they have fallen late and went on vacation or are in the hospital you don't want to think it has been abandoned and begin to start changing the locks or throwing their belongings to the curb. 

You don't always have the legal right and that could be dangerous!

I double checked and made sure I had an abandonment clause and you might want to do the same.

The reason this is important is if the tenant abandons your property the law states you, the landlord, have a duty to serve as the custodian of the tenant's property. This process of placing personal property or goods in the temporary custody or control of another is called bailment. 

Each state imposes by law a bailment that is set for a fixed term (usually 15 to 20 days). As the landlord, you must hold the  tenant’s property for this fixed time in a reasonably secure area. If they don't return and reclaim their property by the end of the time frame you are free to dispose of it as you wish.

Here is a list of the general guidelines a landlord should follow when dealing with an abandoned tenant’s property:

1. Give your former tenant a notice saying what was left behind, where they can get it, how long you'll hold it, what will happen if they don't claim it and and how much it’ll cost for you to store it (you can be paid for your storage costs before the tenant can obtain his property).
2. When you enter the premises bring another person with you who can verify the property abandoned by the tenant. It wouldn't hurt to a make a video just incase the tenant pops back up and says they had a expensive jewelry. 
3. You'll want to hand deliver the notice, if possible, if not mail it to the last known address. 
4. If it goes unclaimed and worth more than $300 you might have to sell it at a public sale if it is less you can do with it as you please. 
5. If you do sell the property at a public sale, you can take back what is owed and the rest is given to the county treasurer of where the sale took place. If it remains unclaimed after a year it is alllll yours! Yay!

Step 3 - Where are they in the lease?

Month to month. Luckily mine were month to month and surrendered the unit back to me.

If they are in month 6 of a 12 month lease you may be due more money than I was and approach the situation differently. 

Step 5 - Determine damages
Once you get into the property you have to be able to determine the damages and see if the deposit will cover damages. Did they trash the place? Are there broken windows and blinds?

When I took over the place they had a deposit of $550 and I never asked for more. I learned my lesson on getting more. When I got there almost all the blinds were broken and there was one broken window. All in all it honestly could have been worse... like way worse. But they also didn't pay rent for the days they were in the unit and gave no notice so I wasn't able to start showing it. 
​
In my situation I paid $390 to have the windows repaired the next day since it was on the front of the house and not in the best area. They also had broken blinds that were about $100 to replace and some light cleaning. They also had keys for exactly half the month so they would owe $650 for rent, $390 for the window, $100 for new blinds, and a deep cleaning fee. Basically they would owe me $590 + cleaning fee after I deducted the deposit.  

Step 6 - Send a Disposition of Deposit
The next step is sending a Disposition of Deposit to the tenants to show them the breakdown of what their security deposit is applied towards.  This usually needs to be mailed within a certain timeframe, or you could lose your entire right to collect any money AND you may have to actually pay the tenant money depending on the state. 

Step 7 - 5 Options to Collect From Former Tenants
If their deposit doesn't cover the damages or what is owed you'll need to choose what to due next and these are your options:

1. Ignore it 
If the amount they owe you is very small, you may choose not to pursue anything else after sending the Disposition of Deposit. If they owe you $75, it might not be worth the time or hassle to try and collect. Just send them what they owe and mark it for future references as someday you may get a request for that tenant. 

This may feel like losing but you can look at it as a valuable experience to better understand how to put systems in place or the importance of a full deposit. 

2. Bill Repeatedly
If you don’t want to ignore it but it isn't enough to take larger action, you can set up a system that mails out a new bill monthly as a constant reminder of what they owe you.

Who knows, maybe someday they'll get a tax return or win the lottery and want to pay it off.

3. Negotiate With Them 
Maybe the tenant doesn't have the $500 they owe but are willing to give you $300 now. It may be worth it to take the money now and move on. 

4. Send to Collections
Collection agencies are designed to pursue individuals with past-due payments. They can vary in techniques to get this money, including tracking down the tenant and calling them repeatedly until the debt has been paid. For their services, collection agencies typically charge a hefty fee, oftentimes 50% of the debt recovered. If you are fairly certain you won’t get the money from the tenant, you can send the invoice to collections and let them deal with it. Who knows, someday down the road you might get a check in the mail.

Because you'll be losing half what you are owed it may not be worth it to go the collection agency route unless you are owed between $1,000 and $4,000 and don’t think they have the money right now. 

5. Take Them to Small Claims Court
If you you are owed up to $10,000 you could pursue a lawsuit in small claims court. This court is designed to help people sue others without the need of lawyers and a lot of money. Usually, for less than a few hundred dollars in fees, you can sue someone, and if you win, you will receive a judgment against them. The judgement could take money from their wages or tax returns. Plus, this judgment can follow the tenant around for years, even showing up on background checks when they apply for a rental property in the future.

Step 8 - Determine What Steps You'll Take
You really have two options, pursue legal action or not. Pursuing legal action would be smart if they damaged your place, skipped out on your lease early, or stole property like a refrigerator. This option may take longer because if they couldn't pay rent while living there it may be hard to collect. It will also serve as a good warning to any potential landlord after you where these tenants may slide on through. 

Not pursuing legal action. Sometimes it may just be what is best for you in terms of time, stress, and even safety. You might be avoiding pushing a person who is currently unstable into a more stressful and aggressive situation. If you have partners or investors it may complicate things but moving on may be best. 

---

Summary
At the end of the day there is no real right or wrong answer. In my situation I am owed $590 + cleaning fees but I got rid of a tenant I had been debating about not wanting to resign. There were some damages but it could have been left in way worse condition.

Coming up I will send out my Disposition of Deposit hoping to get what I am owed. If not, I will then try and negotiate and at least get half since that is what a collections agency would take anyways. If that doesn't work then we'll see what I want to do next. 

In any situation like this I recommend you seek legal council like I did to better understand your states laws. I was able to get all the answers I needed without the $100 fee for a 30 minutes call or a $3,500 retainer the other person wanted!

​Let me know if you feel there are any steps I missed or should include!

The Big Take Aways 

1. Make sure the rehab is completed. 
This is obvious, but I was in the middle of redoing the counters and the applicants were not impressed. Naturally they wanted to see the project be complete before signing a lease. I also think because it is in a C neighborhood there is some distrust toward landlords. 

2. Empty units may show better. 
Since the plan was to move out of my completed unit into the soon to be vacant one I was showing mine. I felt people didn't like seeing the unit with stuff in it and it might have made an already small unit look smaller. 

Because I was acting as the property manager that added a layer of sketchiness. I had one person ask if I was a legitimate business and this wasn't just a scam- apparently that happened to them before.

When the tenant eventually moved out I realized her unit wasn’t that bad and quickly painted, put in new floors, and changed the vanity. The next person that came by I showed both units and he took the empty one. 

3. Section 8 Isn't For Me
I had a couple people ask whether I took a housing voucher. Being new to this I said 'yes' and then began to learn more about the program.  There are different programs that I briefly learned about. 

One, which is Section 8, requires the tenant to pay 30% of their income and the program would pay the remainder. What I kept running into was I felt the remaining income was never enough to meet my requirements. 

Let’s say the tenant made $1000 a month. They would pay $333 for rent and would have $667 left. I just never got comfortable with that when you factor in things like phone, gas, electric, etc. Not to mention what would happen if they lost the voucher. Some people do Section 8 houses and love the guaranteed money from the government but I never got comfortable with it.

There is another kind of voucher for people with Severe Mental Illness (SMI) that if you are determined to be SMI and truly homeless (live in a shelter, not couch surfing) they will cover rent up to a certain amount. There is no income requirement for this, which again, would make me nervous. 

4. Pet Fee
When renting out a unit you'll have to decide whether you will allow pets or not. For me, I do. The units I have aren't the nicest and have either tile or a hardwood laminate flooring. 

What is common is for people to charge a pet fee, I do $25 per pet, but instead of adding that as a separate expense I wrap it into the price of the rent. I should know this, and assume since the lease is a contract for a year, the pet fee would last for the whole lease.  But, I don't know how it would work if  the pet passed away or they got rid of it and whether they would still have to pay.

To ease that confusion for me, and the tenant, I make them sign a pet addendum and wrap the pet fee into the price of the lease. 

​​5. Timing Matters
I had heard certain times are better to rent units compared to others and didn't fully believe it. I rented my first unit in April and received 25% more inquiries compared to August. They both had the same amount of people making contacts the last week of the month but when the weather is not over 105 degrees I had a larger applicant pool. Moving forward I will try and work to not have leases expire in the hotter summer months!

6. Deposit To Hold
This is also an obvious one but I was not sure exactly what I should do. I had a couple that were wanting to rent out my unit but they made that decision on the 20th and wanted to move in on the 1st. Since they wanted to move in and passed all the background checks I didn't know whether to have them sign a lease, just trust that they would move in or what were the next steps.

I had them sign and put down a non refundable deposit to hold the unit that turned into a security deposit if they moved in. It was pretty easy to complete!

I'm sure there were more things I learned but it is actually pretty easy. I did showings back to back so that if no one showed someone was scheduled next. I did it this way since the unit was like 500 square feet and if I did multiple people at the same time there just wouldn't be enough space. You have to do a background check and I always called their places of employment and checked pay stubs. If you have any other questions don't hesitate to reach out!