Property Management Blog

How to Set a Rental Price for My Fredericksburg Investment Home

Carol Holly - Wednesday, July 13, 2016
When you are setting a rental price for your property, the most important thing you can do is to take a look at what has recently rented in your neighborhood. Once you understand the range of rental prices, be careful that your price is not on the highest end of that range or the lowest end. You want to be somewhere in the middle.

 

Real estate agents will be looking at your listing, and tenants will also go online to search for properties. When they see your price, you want them to feel comfortable that they aren’t paying above market rent if they decide to lease your house.

 

At Lorac, when we have a property on the market, we’ll keep track of the interest we receive. If we aren’t getting enough calls or emails for more information, we’ll know that the price is potentially too high. If we are able to get 10 or 11 people into the house to see it, but they don’t want to fill out an application, that’s another indication that the property is overpriced.

 

In a rental market, we reduce the asking price by $100 each time we come down. So, every two weeks if the property is not getting any showings or applications, we’ll reduce the asking rent by $100. That usually gets us more showings and if you get more showings, you have a better chance of reaching interested tenants who will make an offer. Just like with real estate sales, if you have multiple people interested in the same property, it’s possible to get more than the listed price.

 

The way to build wealth with rental properties is by pursuing tenants. Every day, you have to pursue those tenants and get them into your properties. This means responding immediately. Answer every single lead and pick up the phone every time it rings. You can’t have people leaving messages. You have to answer that phone or return a call within minutes. With the internet, people can move onto other properties quickly. You don’t want that to happen.

 

If you have any questions about setting a good rental price for your investment home, please contact us at Lorac Realty and Property Management, and we’d be happy to give you some free advice.

How to Find the Best Tenant – Fredericksburg Property Management Education

Carol Holly - Tuesday, July 12, 2016

If you want to find the best possible tenant for your rental property, we strongly recommend that you qualify your tenants before you even show them the property. There are a number of questions we ask as soon as a potential tenant calls about a property:

  • Why are you moving?

  • How many people will be living in the house?

  • What is your total income?

  • How much debt do you have?

 

You need to ask potential renters these questions because you want to know who you are showing your property to. If the person isn’t qualified, it will be a waste of time to show them the house. You don’t want to put yourself in danger either, by showing a vacant property to someone you have had no contact or conversation with.

 

It’s important to do a little math when you’re looking for your best tenant. For example, if someone calls to inquire about your rental property and you are going through your pre-qualification process, you might find out that the person earns $60,000 per year. Divide that amount by 12 months, and you’ll see that the tenant makes $5,000 per month. You want to multiply that amount by 41 percent, which gives you $2,000 a month they can presumably afford in rent. If your property is $2,000 a month, this sounds like a well qualified tenant. However, you need to start deducting the credit card payments, car payments and other debt payments that will need to be made every month.

 

After you subtract all the other bills they have to pay, you might find out that they can really only afford about $800 per month. You don’t want to put someone into your home who cannot afford it. You’ll only end up back at square one, looking for a new tenant to whom you can re-rent your property.

 

Always qualify a potential tenant as if they were buying your house. When you do that, you’ll ensure they have the money to pay rent and you won’t have to worry about losing any income.

 

If you have any questions about finding the best tenant you possibly can for your rental property, please contact us at Lorac Realty and Property Management, and we’d be happy to help you.

Fredericksburg Tenant Stops Paying Rent? Eviction Best Practices

Carol Holly - Tuesday, July 12, 2016

When a tenant stops paying rent, it’s a crucial time for the owner of a rental property. That’s because Virginia law states you have to send a 5 Day Noncompliance Notice. This means if the rent is due on the first and it hasn’t been paid on the fifth, you need to send that 5 Day Noncompliance right away.

 

If, after five days, the rent is still not paid, you will need to go to the courthouse in order to obtain a warrant for an unlawful detainer. These days, the courts are incredibly crowded. Because of the busy court schedule, your eviction process can take you one or two months, and even longer if you don’t follow all of the steps exactly.

 

Here at Lorac Realty and Property Management, we immediately send out a 5 Day Pay or Quit Notice or a Noncompliance Notice when the rent is late. If the tenant does not pay after receiving our notice, we hand the case over to our attorney right away so our legal counsel can file for the unlawful detainer. This is important because we want to get into the court system that same month.

 

When you go to court, you’ll need some key pieces of information with you. You need to document how much rent the tenants owe, what late charges have been accrued and any other charges such as attorney fees, court fees and filing fees.

 

Virginia law requires you to follow specific rules when you’re pursuing an eviction against a tenant who isn’t paying rent. It’s a complex process that we would be happy to help you with.

 

If you are faced with a tenant who is not paying rent and you’d like some advice, please contact us at Lorac Realty and Property Management.

5 Mistakes that Fredericksburg Landlords Make That Will Cost You Money

Carol Holly - Tuesday, July 12, 2016

 

The biggest mistake a landlord can make is not properly screening the tenant. This mistake can be very expensive, so it’s important to get the screening process right.

 

At Lorac, when we get an application, we immediately screen for credit through all three credit bureaus. We do a criminal background check as well, which is sometimes even more important than the credit report. We also go to what we call the Rent Bureau, which tells us if there is any pending litigation against the tenant in the 52 states and territories. You have to remember that if they didn’t pay the last landlord, they’re not going to pay you either, no matter what kind of story they try to tell you.

 

Our application is four pages long and very thorough. Applicants need to provide their social security number, their email addresses, previous addresses of the places they have lived and three references who are not related to them. Most importantly, we require information for prior landlords. This is critical, and the applicant’s former landlords are the most important people you’ll be dealing with during the screening process.

 

When we send out a verification to previous landlords, we will ask if rent was always paid on time, or if the tenant had ever been late on rent. We ask how many times the tenant was late. We ask if the tenant ever paid with a check that was returned for insufficient funds. It’s important to ask the landlords if they would ever rent to the tenant again and what kind of condition the property was kept in during the tenancy. Landlords are usually very accurate in their information. If they had a good experience with the tenant, they’ll say they were sorry to lose that tenant. If not, they will be very honest about why it wasn’t a good tenant experience.

 

To avoid costly mistakes as a landlord, you need a great property and a great tenant. You can have the best property on the market, but if you don’t screen properly, you won’t get a good tenant. That will cost you a lot of money.

 

If you have any questions about how to avoid this mistake, or you’d like more information on how we perform our tenant screening, please contact us at Lorac Realty and Property Management.

How to Get My Fredericksburg & Northern Virginia Home Rented Fast

Carol Holly - Tuesday, July 12, 2016
The best way to reduce vacancies and to get your home rented quickly is by making sure it looks great to potential renters.

 

Curb Appeal

 

When someone drives by your house, they are going to pay attention to your curb appeal and how the place looks from the outside. With this in mind, keep the lawn freshly mowed, trim the bushes that are in front and put out some colorful flowers that add beauty and interest to your landscape. That kind of thing will really add to your curb appeal. If people see a house that is well taken care of, they will want to open up the door, go inside and walk through the property.

 

Showings

 

Another thing that will reduce your vacancies and get your home rented fast is the ability to show it right away. If you don’t have time to do this yourself, make sure you hire a property manager who is motivated and can immediately take care of any requests to see your property. You want to be responsive to any interest you get from your marketing. Make sure you respond right away and make sure you’re willing to show the house at a time that’s convenient for your potential tenants.

 

Interior

 

Whether you’re renting out your property or selling it, the place needs to be in move-in ready condition. When someone walks in and sees your house, they need to feel like they can move right in. Have it professionally cleaned, have the carpets done and touch up any painting that isn’t perfect. These are the three biggest things people will notice as they are walking through a home.

 

To get your home rented quickly, you need to get customers in the door. The best way to get a customer in the door is to have the house looking fantastic. The longer you keep a person in the house, the greater your chances are of renting or selling it.

 

If you have any additional questions about reducing vacancies and getting a tenant into your home quickly, please contact us at Lorac Realty and Property Management. We’d be happy to help you.


Contact Us

Lorac Property Management

4820 Southpoint Drive, Ste. 101
Fredericksburg, VA. 22407

O: (540) 898-6988
F: (888) 227-5960

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