Greater Baltimore Property Management Blog

NEW: Rental Property Licensing

System - Monday, July 16, 2018

On August 1, 2018, a new law takes effect requiring all Baltimore City rental properties, including one- and two-family and multi-family dwellings, to be licensed to operate as a rental by January 1, 2019. In order to receive a license from the Department of Housing and Community Development (DHCD) the property must meet two requirements: 1) must be registered with DHCD using the online portal and 2) must be inspected by a State Licensed, Baltimore City registered Home Inspector.

The new system does not eliminate the annual registration fee (which remains unchanged at $30 per dwelling unit for one-family and two-family houses, and $35 per dwelling unit for buildings with more than 2 units). The new system differentiates “registration”, which is done annually, and “licensing”. The “License” will last 3 years for “good” landlords; defined as one who gets violation notices corrected within 60 days of their issuance. The License will last 2 years if the landlord gets violation notices corrected within 90 days of their issuance. Landlords are “bad” if they take more than 90 days to correct housing, building, and fire code violations and, therefore, must get their units inspected every year. “Bad” landlords on one-year licenses must pay an additional $15 per unit registration fee. The system is designed to reward “good” landlords who keep their properties in good repair and respond promptly to violation notices.

Are you prepared? If not contact the Pros... PropertyWize! For additional information please visit PropertyWize.com or call 24/7 410-372-6512!

Should I Rent to Section 8 Tenants? A Guide to the Housing Choice Voucher Program

System - Wednesday, May 30, 2018

The term “Section 8 tenants” refers to renters who qualify for the government’s Housing Choice Voucher Program.

So how do people qualify, and what exactly is this program?

Renters who qualify must have an extremely low income, and if they do, the program helps them afford local housing by paying for 33%-75% of the rent.

Some people in this program are elderly, some are disabled, and some simply have little or no income.

Landlords are divided on whether they should or must rent to Section 8 tenants.

Landlords are divided on whether they should or must rent to Section 8 tenants, and for good reason. The laws vary state to state, and even county to county.

The Fair Housing Act (FHA), a federal law, doesn’t prohibit landlords from discriminating based on Section 8. However, some states, counties, and municipalities do, often by prohibiting discrimination based on “source of income” or “public assistance status” – considering them a “protected class.”

Here’s an overview of the pros and cons.

Pros & Cons of the Section 8 Program

Section 8 Waitlist

Pro: Guaranteed Rent

“Guaranteed Rent” – Two words that are music to a landlord’s ears. It almost sounds too good to be true.

But, under the Section 8 program, you are guaranteed at least a portion of the rent to be paid to you by the government – the U.S. Department of Housing and Urban Development (HUD), to be exact.

And because you’re dealing with the federal government, this could be a mixed bag. Which brings us to our first two cons …

Con: The Approval Process

As with any government agency, red tape is involved, and Section 8 is no different.

First, you must fill out paperwork, and then your local Public Housing Authority, which operates under the Housing Choice Voucher Program, must approve your rental property.

Then, your property must undergo an inspection, and if approved, it must continue this type of inspection annually.

To pass, your property needs to meet acceptable health and safety codes. And whether your house is approved could depend on how stringent the inspector is in your area (meaning – you should expect to repair minor issues).

Related: HUD Inspection Checklist.

Con: Subject to Rent Control

If you are approved, the Housing Authority then reviews your lease and often restricts how much you can charge for rent. In other words, you can’t necessarily charge what you like.

You can’t charge whatever you want.

You generally can only charge what other properties in your area charge. So your property will be subject to a sort of appraisal process to determine rent.

Note that sometimes, depending on the area your property is in, you might receive more rent through HUD than you would by going through the open marketplace (but I wouldn’t count on it).

HUD then agrees to pay a certain percentage (this varies by case) of the rent. Your tenant pays the remainder, which usually amounts to 30% of their gross income.

Generally, a tenant only pays about 30% of the rent amount.

Pro: Long-term Tenants

Many Section 8 tenants, after being approved for the program and after finding a place to rent, tend to stay put for a while.

Moving is allowed, but Section 8 tenants need to notify the Housing Authority, give you proper notice, and find another place. In other words, it’s a hassle.

Plus, when Section 8 tenants sign a lease, it’s generally for at least one year.

Con: You Hurry Up and Wait

It usually takes a long time to go through the Section 8 process.

By the time you fill out the paperwork, get an inspector to come out, make necessary repairs if required, get the inspector to come out again to check your repairs, get a tenant in, and then receive rent, you might have been able to rent the place to someone else sooner. Meanwhile, you’re receiving no income.

The vacancy caused by delays due to red tape usually outweighs any benefit of the program.

Your Results May (Will) Vary

Section 8 tenants have a bad reputation. And just like any stereotype, there could be some truth to it, but every case is different.

People complain that Section 8 tenants are masters at manipulating the system, and many landlords are left holding the bag.

As with all tenants, there are so many things that can go wrong. For example:

  • They lose their voucher, and then won’t leave,
  • They destroyed your property, and the housing authority won’t compensate you,
  • They moved extra people in despite that being against the rules.
  • But just as there are horror stories with Section 8 tenants, there are good experiences too.

Some people, whether they are temporarily down on their luck, are disabled, or live on a fixed income, might not be able to afford housing without some help, but they could make wonderful tenants.

The key is for you to run a background check and credit report, and to call prior landlords. Do your due diligence before accepting any tenant.

Related: The Landlord’s Guide to Tenant Screening

Some Municipalities Require Participation

Some municipalities (I’m looking at you Oregon) require landlords to accept Section 8 tenants, meaning that whether you want to deal with a government agency or not, you have to, even though this should be the landlord’s decision.

Related: Oregon anti-discrimination law means landlords can no longer advertise ‘No Section 8’ (Oregon Live)

For example, if a Section 8 tenant fills out a rental application in a municipality that requires landlords to accept it, and if that applicant passes your screening process, you need to start the ball rolling to have your property approved… unless you rent it to another qualified applicant first. (After all, the government is not known for moving fast.)

Even California and the city of Chicago protect people in the program; however, many states like Colorado allow a landlord to “opt-in,” rather than being required to participate.

Note that you don’t have to accept an applicant just because they have a Section 8 voucher. In jurisdictions that require you to take Section 8 tenants, you are encouraged to screen them as you would anyone else.

You need to contact your local or state fair housing agency to determine what the law is in your jurisdiction.

Real Original Article

Slacking on Rent Payments Can Cost You More Than Late Fees

System - Monday, April 16, 2018

From a very young age many of us are taught the importance of being on time and that arriving late is a sign of disrespect. As we grow older, we become more lax. We love staying up late past our bedtime, we learn it’s expected to be fashionably late for parties and no matter how late we get home from work, we no longer worry about missing our favorite TV shows thanks to the DVR.

Read Full Article

8 Home Repairs That Are Not a Landlord’s Job

System - Thursday, February 1, 2018

By Dahna M Chandler | Jan 10, 2018 4:00PM

Put that phone down—these fixes are on you, not your landlord.

Renting is the life … you’re not tied down, and there are no repairs to worry about, right? Well, sort of. While your landlord is expected to handle many fixes, there are others that are on you.

Your lease will often define exactly when and how you should make any repairs. When in doubt, pull out the paperwork. The general rule of thumb is that renters are responsible for repairing any damage that they cause themselves. So if you want to remain on peaceful terms with your landlord, don’t be that renter who calls for help changing a lightbulb.

8 Maintenance Issues Renters Are Responsible For

1. Flea extermination—even if you pay a pet fee

Your pet fee isn’t pet maintenance insurance. Your landlord is responsible for eliminating bugs like roaches and ants, but “not a problem you brought with you,” says Mindy Jensen, community manager and podcast coordinator at Bigger Pockets . Keep anti-flea products in your rental (and on your dog!) to take care of this problem.

2. Carpet stains or floor scratches beyond normal wear and tear

Your landlord expects to repair or replace floors every few years because of regular, everyday use. But if your definition of “everyday use” includes wearing cleats on the carpet and bowling in the kitchen, you should be prepared to fix the floors yourself. Don’t ask your landlord to clean stains from spills, your pets, bleach, or nail polish.

3. Damage to walls or ceilings

It’s one thing to request a paint job after you’ve lived in a place for several years. But landlords don’t have to repair holes you made or repaint to eliminate the cigarette smell after your roommate with a pack-a-day habit moves out. And for major repairs, you should both pay for the work and fess up. Tell your landlord what happened and explain that you’ll rectify the situation with professionals.

4. Broken appliances you’ve misused

If you tend to close the dishwasher with your foot, sooner or later it’s going to break. And your landlord won’t be keen to replace it. “Don’t expect the landlord to repair appliances you’ve misused,” Jensen says. Misuse also includes things like using the wrong type of detergent in a front-loading washer and putting chicken bones or peach pits into the garbage disposal.

5. Locks or windows you broke when you’d lost your keys

It’s true that the law requires your landlord to maintain security by replacing broken locks or windows. But if you’re the one who breaks ’em, you’ll be the one paying for ’em. “The landlord is not responsible for your losing or forgetting your keys,” says Jensen. So next time you get locked out, take the time to call a locksmith or building maintenance, or leave a spare key with a trusted friend or neighbor.

6. Clogged drains

Some clogs are unavoidable or caused by defective plumbing. But when you’ve used your bathtub as a haircut staging area or have gotten overzealous with the toilet paper, that clog’s yours to solve.

To avoid trouble, never use your toilet to toss out kitty’s litter, paper towels, or dental floss. And if you live with kids or invite them over, keep the lid down—you never know what they’ll throw in there. Learn how to use a plunger and liquid drain cleaner, and keep both handy. Otherwise, be prepared to pay a pricey plumber’s bill.

7. A furnace that’s on the fritz because you didn’t change the filters

A basic filter costs less than $10. Changing it out a few times a year is far cheaper and easier than insisting your landlord send over an HVAC pro to tune up or fix your system. If a pro comes over to fix a failed furnace or air conditioner and finds an ancient, clogged filter, they’re going to know right away what caused the problem. Avoid that disaster by doing routine removable filter maintenance yourself.

8. Accidental water damage

Landlords are definitely responsible for repairing flood damage after a major rain storm or a random pipe failure. But don’t expect the landlord to fix the water damage when you’ve left the bathtub running, used the wrong soap in the dishwasher, or repeatedly flushed the clogged toilet till it overflowed. When it comes to flooding, the culprit is typically pretty clear: If it wasn’t Mother Nature, it was probably you.

Originally published on October 4, 2017; updated January 10, 2018.

Do You Love Your Property Manager?

System - Sunday, July 9, 2017

When you ask most people today if they love their Property Manager, most of them will probably say No. A lot of people are just comfortable with the idea that, "Hey, it's nothing too exciting about my Property Manager but it could be a lot worse". We beg to differ, at PropertyWize we feel that you should be comfortable with saying "I love my Property Manager! without hesitation or a second thought. A great property manager can add significant value to your investment and, most importantly, end your headache.

We comprised a list of what makes the difference between a Property Manager you tolerate and a Great Property Manager that you love. On a Scale of 1-5

Rate your experience

1- Never
2- Hardly Ever
3-Sometimes
4- Most of the Time
5- Always

Communication

Good communication is essential for any Property Manager. In fact, one of the primary jobs of a Property Manager is to bridge the gap between an owner, contractors, and tenants. A great Property Manager has the skills to initiate and maintain open and direct communication that results in successful relationships, lower costs, and greater value for our clients. At PropertyWize we're great with properties and even better with relationships.

Does your Property Manager communicate with you proactively to avoid serious issues that can be prevented? Do you receive timely notifications when there is a situation that may significantly affect your investment, e.g., pending evictions, major damages?

Rating: ____________

When you need to reach your Property Manager or have a question do get a response in a timely manner?

Rating: ____________

Tenant Placement

For over a decade now, we have seen thousands of applications and have come to realize the most important part of our business is Tenant Placement. Our proven 3-step screening process and in-depth background checks find the warning signs of problem tenants and help us find the best applicant for any home. At PropertyWize, we take Tenant Placement seriously!

Does your Property Manager meet or exceed your expectations by selectively screening and processing all tenants they place in your property?

Rating: ____________

Does your Property Manager stand behind its work by offering a warranty for the quality of the tenant it has selected for your property?

Rating: ____________

Risk Management

It only takes one troublesome tenant to cause significant legal and financial stress. Great Property Managers must be skillful in settling disputes before they grow into legal problems. Further, they must stay abreast of the latest regulatory requirements and landlord-tenant laws in order to avoid fines and expensive litigation as a result of compliance failures. In fact, PropertyWize takes this so seriously, we invest in Fair Housing training for all of our staff and attend workshops and conferences (locally and nationally) to keep us equipped to protect your investment well within the bounds of the law.

Does your Property Manager understand and follow safety and other regulatory requirements, as well as landlord-tenant codes, in order to mitigate the risk of fines, penalties, and legal actions, e.g., meeting or exceeding lead-safe requirements and notifying you about the benefits risk reductions of becoming Lead Free.

Rating: ____________

Does your Property Manager make sure the lease agreement was written to protect your interests? Does he/she advocate and hold tenants accountable for not following the lease agreement?

Rating: ____________

Is your Property Manager able to settle disputes before they become costly problems?

Rating: ____________

Relationship

Developing trust and understanding is the key to a successful and positive owner/manager relationship. PropertyWize builds its client relationships with our high standards of excellence. And though we set the bar high in all that we do, we're never fully satisfied. We're always looking for new ways to improve our service and add convenience and value for our clients. In addition, we do what we say we will do... and that builds trust.

Does Your Property Manager consistently meet deadlines and keep its word to you?

Rating: ____________

Does your Property Manager consistently invest the time and energy to enhance your experience, e.g., consistently using technology to better, faster, more efficient services such as owners statements and distributions?

Rating: ____________

Scale

0-10: Time to Fire Your Current Property Manager Immediately
11-17: Its time to put your Property Manager on an Action Plan. If you don't see significant improvement within 90 days, you might want to talk to us.
18-23: Have an open dialog with your Property Manager to express your concerns. You might be surprised at the results. But, as a back-up, research other property management options and plan an exit strategy... just in case.
24-30: Congratulations! You can say you love your Property Manager! You can help your Property Manager help others by providing referrals and positive reviews on all online platforms.

Hope you enjoyed this Quiz! If you have a property Headache in the Central Maryland region visit propertywize.com and End Your Headache now!