Triple Win Property Management Blog

12 Tasks for Property Management Automation

Property management automation refers to using technology and software to automate various tasks and optimize processes related to managing properties. It can involve using single-family property management software to streamline tasks such as rent collection, applicant screening, property maintenance requests, and accounting, among others. At Second Nature, we think of automation and outsourcing as two sides of the same coin. Either way, you're getting your time back. That's why our focus is making life better for residents and easier for property managers. Our suite of resident services helps support a better resident experience, driving up retention and making investors happier, too. And, since we fully manage every part of it, we also make life easier for you, the property manager. That's a "triple win." With that being said, let's dive into the nitty-gritty of property management automation: the 12 tasks and seven tools you can most easily automate and the seven tools to help you get there. Which Property Management Tasks Should You Automate? Automation might make us think of manufacturing lines or robots, but in the modern workplace, automation is simply a catch-all term for tech tools that can instantly streamline your work process. Automation tools handle time-consuming, repetitive tasks, speeding up the workflow process, creating fewer mistakes, and freeing us up to do more valuable work. Without automation, we find ourselves losing time with busy work like: Manually entering data Writing and sending emails Phone calls and follow-up Keeping track of to-do lists Fixing mistakes in spreadsheets or other work Reminding team members how to do day-to-day tasks Think about the last month when you took the same action repeatedly – or saw the same situation and made the same decision – or got the same question and shared the same information. If a task is easily duplicated and policy/rule-based, automation is coming for it. Here are a few of the most common areas where PMs are standardizing and applying automation tools. 1. Rent collection automation Online rent payments can automate reminders to tenants, reduce errors, and increase on-time payments to collect rent without creating any additional work for the PM. Tools like ELI+ (formerly Colleen.ai) and EliseAI are innovating this space. Both are chatbot-type tools that help automate things like rent collection by automating communication about delinquency and the follow-up process. The tools communicate directly with your residents for you with rent payment reminders, support, and more. 2. Property inspections and compliance Maintaining compliance with property regulations and ensuring thorough inspections are critical responsibilities for property managers. Using an automated checklist on a handheld device not only speeds up the inspection process but also ensures consistency, helping you meet regulatory standards efficiently. Automation tools can instantly generate comprehensive reports, eliminating the need to return to the office to manually input data. Tools like RentCheck and OnSight Pros can either automate or outsource this work for you as a property manager. RentCheck is a software tool that you and your staff can use for photos, checklists, workflows, and more, all while ensuring that inspections adhere to compliance standards. There's also a native app that residents can use to do inspections themselves. Then, it will compile a clean, easy report that you can send to your investors. OnSight Pros isn't exactly an automation, but it has the same impact on your workflow. They have a network of professionals who do property reviews in person for you, helping you stay compliant without having to perform every inspection yourself. They're not available in every market, but you can check their website for available service areas. Related: 5 Best Property Management Inspection Software Property Management Rental Inspection Checklist [Free Template] 3. Maintenance requests A 24/7 maintenance portal means you don’t have to take calls every time they come in, and you can quickly and easily triage maintenance requests. Tools like Property Meld help automate work requests, vendor communication, scheduling, and more. Mezo is another newer tool on the market that provides conversational AI to interact with your residents, scope the maintenance issue, support self-service, and help deploy the right professional if needed. With a tool like this, you can eliminate multiple trips out to the property or even have it fixed by the residents themselves. Related: 10 Best Property Maintenance Software 4. Accounting and bookkeeping Bookkeeping was one of the first areas of automation when computers entered the scene. It's hard to find a professional property management business that doesn't use property accounting software. Tools like Rentvine help automate fees, statements, financial tracking, and more. Most property management software platforms provide accounting features, and everyone uses them somewhat differently. You can use integrations, layer in vertical tools, and more. However, a lot of the actual accounting can't be truly automated. Instead, you can outsource to companies like Bynnd and Reconcile Daily who will do the accounting work for you. 5. Document management Property managers are always on the go. Automated document management is a game-changer. This one is pretty straightforward. Most property management software works with cloud-based documents and tracking or integrates with services like Docusign. 6. Managing new accounts With integrations, you can add new properties, trigger automatic processes, and reduce vacancies more quickly. For example, after entering a new property in your CRM, automation can launch a new property checklist and notify your whole team. For example, you can set up an integration where a new lead comes in as "won" through LeadSimple and Zapier automatically starts a new property checklist in Process Street, populates the data from the sales process, and assigns the checklist to the right person on your team. All automated. 7. Resident communication Email is the most common form of communication, and yes, it is automation. Some PMs are using even more streamlined workflow communication like Slack, LeadSimple, or Help Scout. Automation can feel alarming to some at first, but the best property managers are embracing it. They’re quick to do the hard work of developing policies, documenting the process, and then using tools to systemize their expertise and automate the work. The result is more reliable and likely less expensive than people doing it. Solutions like LeadSimple provide communication tools across customer types so you can set up automation for clients and residents. 8. Lease renewals Automating lease renewals allows property managers to streamline communication with residents when their lease is going to end soon. Various tools on the market can automatically generate renewal reminders, send them to residents, and draft lease agreements for electronic signatures. By automating this process, property managers can ensure they never miss a renewal opportunity, helping to reduce vacancies and keeping the workflow organized without manual tracking. Related: How to Craft a Lease Renewal Letter That Wows Your Residents [Free Template] 9. Resident onboarding Self-service workflows for resident onboarding allow new residents to manage their move-in process independently. Through online portals, automated messaging, and chatbots, property managers can reduce their direct involvement. This is especially useful for smaller property management companies that need to stay competitive while cutting down on manual tasks. By using these tools, residents can handle everything from signing leases and making deposits to setting up rent payments and maintenance requests, all without the need for back-and-forth communication. Although some property management companies may have some hesitation around adopting new technologies, the ability to simplify operations and offer a more seamless experience to residents makes these systems a smart choice for companies looking to operate efficiently in a tech-driven world. Related: How to Create Self-Service Tenant Onboarding Workflows Best Tenant Onboarding Software 10 Steps to Onboard New Tenants 10. Vendor management Managing vendors is an integral and sometimes time-consuming part of property management. Automation helps by consolidating communication and scheduling. For example, software systems can automatically dispatch work orders, track progress, and update the property manager on the status of repairs or maintenance. By using automation to manage vendor interactions, property managers can ensure timely service delivery while keeping their operations running smoothly. 11. Reporting and analytics Automating reporting and analytics allows property managers to track essential key performance indicators (KPIs) in real-time, providing a clearer picture of both financial and operational performance. These KPIs might include rent collection trends, occupancy rates, or maintenance costs, categorized by financial, operational, or property performance. By automating reports, property management companies can instantly access critical, transactional data while keeping sight of broader objectives like maximizing customer lifetime value. This enables data-driven decisions that not only focus on short-term metrics but also support long-term growth and stability. Learn more: Top 20 Property Management KPIs to Track 12. Utility billing and expense management automation Utility billing and expense management can be complex, but automation tools simplify the process by accurately tracking utility usage, generating bills, and distributing them to residents. This eliminates manual errors and ensures timely payment, while also allowing managers to monitor utility expenses across multiple properties. With automation, you gain full visibility into costs, making budgeting and forecasting significantly easier. Property Management Automation Tools After identifying the processes you want to automate, the next step is to adopt the best tools available to property managers. We’re seeing buzz from PMs across the industry using automation tools at every stage of their operations. One of the more visible examples out there is Peter Lohmann, CEO of RL Property Management. He outlined several no-code tools that he uses to automate his property management business. No-code tools are easy for anyone, and most can “talk” to other software through APIs. Here are some of the tools we like the best and how Lohmann has used them for his PMC: 1. LeadSimple LeadSimple is a sales and operations CRM geared towards property and real estate management. You can approve a rental application in the CRM and trigger other automations like emails, checklists, and more. LeadSimple recently added workflow automation and an inbox product that works like a ticketing system. 2. Zapier Zapier is a workflow automation app that connects all your other apps. For example, when you mark a new property in your CRM, it can “zap” your checklist software to start a “New Property Checklist.” 3. Process Street Process Street is an automated checklist software that gets your entire team on the same page. You can assign management tasks, mark priorities and completions, schedule, and more. It also has email templates that can be automatically populated from your CRM. 4. Slack We all know Slack. Slack is the communications app that puts your whole team in one place, sets up groups, streamlines topics, and more. Zapier can automatically send notifications through Slack about new accounts and assignments. 5. Mailchimp Mailchimp automates and sends professional emails. Through integrations, you can connect it with your CRM and other automations, so emails are automatically populated and triggered at the right time. 6. Airtable Lohmann explains that he has transitioned all non-financial data from their legacy system into Airtable, where they have control of it and can connect it to other tools. 7. Buildium Buildium is a property management software for PMs with 50+ doors in their portfolio. With a monthly fee, you can use Buildium to set up recurring rent payments with credit cards or ACH and use other property management features. Benefits of Automating Property Management Workflows and Processes Professional property managers don’t just manage property; they manage projects, workflows, and processes. Here are some of the top benefits of implementing automation tools to improve those processes and workflows. Improved efficiency Automated property management processes can drastically reduce the time spent on repetitive tasks, allowing your team to focus on more strategic activities. Use rent collection as an example: Instead of manually tracking payments, an automated system can collect payments electronically, keeping records updated in real time. Minimized errors Automated workflows minimize the chance of human error in tasks like accounting, tenant screening, or maintenance scheduling, ensuring accuracy and consistency. For instance, in accounting, automating calculations and data entry can reduce errors that may occur due to manual entry, ensuring the accuracy of financial records. Increased resident satisfaction Automation can speed up response times to maintenance requests, rent payment processing, and communication, leading to a better tenant experience. Using maintenance as an example here: Tenants can submit requests online, the system can automatically assign a service provider, and update the tenant with progress in real-time. Enhanced communication Automated reminders and notifications keep all stakeholders, from tenants to service providers, informed and engaged, improving communication. For example, automated reminders can notify tenants about upcoming lease renewals or rent due dates, ensuring they're well-informed and reducing late payments. Scalability Automated systems allow for easier scaling of operations as your property portfolio grows. It's much simpler to manage increased workloads when processes are automated. As your property portfolio grows, an automated system can easily handle adding new tenants, properties, and corresponding data, without requiring more administrative effort. Real-time reporting With automation, real-time reporting becomes possible, providing valuable insights into your business's performance and enabling better decision-making. An automated system can provide real-time occupancy rates, rental arrears, or maintenance costs, enabling you to make data-driven decisions. Cost savings By streamlining operations and reducing manual labor, property management automation can lead to significant cost savings in the long run. By automating routine tasks like tenant screening or lease agreement generation, you can save administrative time and associated labor costs. Regulatory compliance Automated systems can help ensure compliance with housing laws and regulations, reducing the risk of legal issues. For example, automated systems can update you on changes to housing laws and ensure all lease agreements are compliant. Remember, automation doesn't mean losing the personal touch that sets your business apart. Instead, it's about freeing up time and resources to focus more on those areas that truly require a human touch. What Is an Example of an Automated Property Management System? One innovative example of automated property management is right here at Second Nature. Our service helps manage and automate the resident experience to be the best that it can be. Our Resident Benefits Package allows property managers to deliver premium services – without the hassle of managing the programs in-house. Second Nature's RBP™ offers benefits that residents pay and stay for, like rent reporting, renters insurance, filter delivery, identity protection, resident rewards, and even a move-in concierge. With the RBP™ you can essentially automate resident happiness. How Second Nature Helps With Property Management Automation Automation sets professional property managers apart. As automation is adopted across the industry, professional PMs are more likely to build the right systems and put together the right tools faster than people who aren’t as motivated or skilled. At Second Nature, we believe in the power of innovation, and we see it every day in property managers around the country. Our tools, like the Resident Benefits Package, aim to bring more ease and automation to your work processes so you can get out there and grow your business. Learn more about our benefits and tools at secondnature.com.

September 26, 2024

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Resident Benefits Package: What is it? And How to Roll Out

What is a Resident Benefits Package? A Resident Benefits Package (RBP) is a selection of services provided by property managers to residents of rental properties. Sometimes referred to as a “tenant benefits package,” these benefits are usually included in the lease agreement and are designed to make residents’ lives easier by meeting their wants and needs. Some examples of these services could include filter delivery, credit building, and 24/7 maintenance. At Second Nature, we pioneered the only fully managed resident benefits package. If you’re ready to get started, you can start building your own Resident Benefits Package today! Note: We chose the term “resident” because the “tenant benefit package” sounded too impersonal for the value we’re driving. Continue reading to find out the benefits of a resident benefit package, how it can generate revenue, and how to implement one to give your residents, investors, and business a win. What Are the Benefits of a Resident Benefits Package? The resident benefits package adds value to residents by anticipating their needs and providing them with services that make life easier and better. It adds value to investors by preventing maintenance, vacancy, and delinquency. And, of course, it adds value to property managers because it differentiates them from the competition. Let’s take a deeper look at how the RBP creates a Triple Win – for residents, for investors, and for you, the property manager. 1. Attracting and retaining residents through better experiences Offering a comprehensive benefits package can make a property more appealing to potential residents. By providing desirable perks such as exclusive discounts, concierge services, or access to credit reporting and other financial benefits, the property management company can attract a larger pool of prospective residents and increase occupancy rates. Retaining residents is also crucial for profitability, as turnover costs can be significant. A benefits package can enhance resident satisfaction and loyalty, reducing turnover and associated expenses. 2. Higher rental rates for higher value A well-curated tenant benefit package makes properties more valuable. When residents perceive additional value in the form of amenities, services, or discounts, they are often willing to pay more for their living experience. This allows the property management company to command premium prices for their units, leading to increased revenue and improved profitability. 3. Differentiation and competitive advantage In a crowded real estate market, a distinct resident benefits package can set a property apart from competitors. It becomes a unique selling proposition that highlights the property management company's commitment to providing an exceptional living experience. By offering a package that exceeds what other properties in the area provide, the company gains a competitive advantage and attracts residents who value the added benefits. 4. Ancillary revenue opportunities A tenant benefits package can create opportunities for generating additional revenue streams tied to specific benefits in the package. Resident Benefit Fee: How Much Does a Resident Benefit Package Cost? Most resident benefits packages cost between $20 and $100, which is often included in the lease and added as a monthly fee for the resident. Prices vary depending on a few key factors, chief among them being the mix of benefits selected by the property manager. What Does a Resident Benefits Package Include? Here’s what the Second Nature Resident Benefit Package includes. Filter delivery service Air filter delivery was the first service Second Nature offered to scattered-site and single-family property managers. It is a cornerstone of the RBP, and over 1M residents have shown that a physical, tangible product is key to their ongoing perception of value. One of the most common causes of HVAC maintenance requests is a failure to change the home’s air filters on time. Air filter delivery from Second Nature solves the problem by delivering the correct-sized high-quality HVAC filters directly to each home’s front door on a predetermined schedule. The delivery serves as a reminder for the resident to change the filter, and voila – problem solved. The resident breathes clean air, the PM has fewer HVAC tickets to deal with, and the investor has their asset protected. That’s a triple win. Our message to residents: “Changing filters is as easy as opening the front door.” Phil Owen, founder of OnSight PROS, says of the delivery system: “Last year OnSight PROS performed third-party property condition reports at almost 18k single-family rental properties on behalf of property managers. The number of filters that we have to replace or mark as ‘needs attention’ becomes almost zero when a PM implements the Second Nature program. I cannot imagine how a property manager could justify not protecting their landlords with this program. The difference between those using the program and those who simply hope that their tenants go to the store to purchase and install a new filter is staggering.” Our filter delivery service has proven to reduce total HVAC maintenance requests by 38% and save up to $250 per year per property. $1 million identity protection One in four Americans will be victims of identity theft. In 2021, digital theft incidence surpassed home burglary incidents for the first time – and is rapidly rising. With identity protection as part of your RBP, every adult on the lease automatically gets the peace of mind you can expect from professional-level identity protection. Backed by AIG and monitored through IBM’s Watson, Aura Identity Guard works proactively on behalf of the resident to identify fraudulent use of their identity and alert them. In the event of an actual identity theft case, the resident receives a dedicated case manager and is covered up to $1,000,000 for most resulting damages. This protects the resident's ability to pay rent, which makes it a win for the investor. And it keeps property managers out of the middle of another difficult situation and decision. Related: How to Help Residents Use Their Identity Protection Services During a Data Breach Credit building With RBP’s credit building service, on-time rental payments improve the credit score of your residents. It may seem crazy that people are building credit by paying for Netflix and other small subscriptions, but not their largest monthly payment... rent! But that's the truth for most residents. We asked, how is it even possible that someone's largest monthly expense is the only one they aren't getting credit or rewards for? This credit reporting program reports positive-impact, on-time rent payments automatically to all three credit bureaus, helping residents build their credit simply for paying their rent on time. Residents also get an immediate boost with 24 months of back reporting included. This service directly impacts rates on credit cards, auto loans, and future mortgages, incentivizing residents to get rent in on time and helping set them up for home buying in the future. The property manager and the investor both reap the benefit of the extra incentive to get rent on time and the resident gets to see their credit score rise as a result of something they have to do anyway. It’s a big-time triple win here. Resident rewards program Rental rewards are a favorite among residents and another powerful and positive incentive for on-time rent payments. Rental rewards programs deliver automatic benefits at move-in. Then, residents can unlock even more rewards by paying rent on the day it's due. At Second Nature, all on-time payment tracking is done through the app. Like other services in your RBP, it’s managed for you. Gifts include: $30 gift card for national and local brands $25 restaurant card $40 rewards cash on rent day each month rent is paid on time And more The value of rewards is covered in the cost of the RBP, so the property manager isn’t seeing any additional liabilities. The PM and investor only see a benefit, which is the increase in on-time rent payments. For the resident, rent day is now rewards day. Another triple win. Move-in concierge Setting up utilities can be a massive headache for a new resident. Residents aren’t sure who to call and who provides utilities and home services like internet and TV for their new address. Moreover, the research for discounts/promotions/coupons available takes more time. Most times, the process is clunky, with lots of friction that gets in the way of it getting 100% done. And it is too easy to overlook fine print in the lease about installing satellite dishes. Move-in Concierge changes all of that for professional property managers. In one phone call, residents find out what their best options are and can even get help simplifying setup. An experienced concierge confidently guides multiple people every day to properly set up their utilities. Renters insurance program Nearly all property managers require a renters insurance policy in their lease agreements. As part of our RBP, Second Nature offers price-competitive insurance coverage options through a Renters Insurance Program that property managers can apply to all their residents locked in with one group rate. Residents who have their own renters insurance can receive a waiver on RBP's insurance program, but the current list of enrolled residents is tracked for you by Second Nature, and any resident who drops off of their own insurance is automatically enrolled. No more hassle for you, quality asset coverage for the investor, and immediate and comprehensive liability coverage for the resident – another triple win you can create with your Resident Benefits Package. Additional benefits At Second Nature, we help property managers deliver all their services to residents. If you’re already offering perks and are ready to level up to a resident benefits package, we can help you bundle the above benefits with other services. We’ve worked with PMs to bundle in their existing property management services, including: 24/7 maintenance coordination: A huge benefit to residents and PMs is a service that provides after-hours support without dragging the property manager out of bed. This type of program makes reporting pesky maintenance issues easy and fast for the resident. It also helps prioritize emergency maintenance. Online portal: With a simplified online resident portal, residents can access all of their documents, messages, and more through an app. Residents can also pay rent and receive reminders to pay rent online. Home buying assistance: For residents who are building up toward home ownership, some PMs offer assistance in building credit and savings. We help them get there. Vetted vendor network: A vetted network ensures that vendors who service your properties are screened to exceed your standards for insurance, licensing, and professionalism on the job. Property managers, residents, and investors can rest easy knowing that they have the best vendors working on their assets. Washer/dryer rental: Some properties may have these appliances installed or the residents come with their own, but we’ve seen the impact on prospective applicants choosing homes due to the convenience of having the washer/dryer available. Security deposit alternatives: Security deposit alternatives come in different packages, but all serve to provide residents ways to be financially liable for damages without having to pay a significant lump sum upfront. Pure insurance, surety bonds, and ACH authorization programs are all versions of deposit alternatives that seek to lower the barriers to rental, which in turn keeps days-on-market low and turnover costs down. Pest control services: Property managers can partner with pest control companies to provide routine or property management pest control services to the homes they manage. Bugs are one of the most common complaints from renters, and having services available to prevent infestation issues is a big win for resident experience. When implementing a full-service, fully managed resident benefits package, you don’t have to lose the benefits you already offer. A great service can integrate all of these benefits together – delivering more impact to residents, investors, and property managers. How Much Revenue Can I Create Per Unit With a Resident Benefits Package? The amount of ROI on a resident benefits package will vary depending on the property class type, market, and number and type of services offered. Generally speaking, resident benefits packages are often in the $25-75/mo range for residents, but could be more or less. It depends primarily on the amount and type of products and services. To go back to our concept of the experience economy: a resident benefits package gives residents the kind of incredible experience that they will pay and stay for. In short, keeping residents happy can reduce turnover and lead to lower costs and higher ROI for you and your investor. According to Eric Wetherington, VP of Strategic Initiatives at PURE Property Management, “Revenue is all about providing a service. The younger generations we’re dealing with in property management – they want convenience, they want experiences, and they want things to be simple, and they’re willing to pay to have things taken care of for them.” A fully managed resident benefits package can generate revenue in two key ways: Increasing services to improve resident retention Decreasing costs by increasing efficiency A resident benefits package can help to accomplish both. Routine filter delivery cuts down on HVAC and maintenance costs. A move-in concierge helps cut down time and cost as residents get settled in their new home. Credit building services keep residents invested in paying on time, sending online payments, and delivering incredible value. The list goes on. A resident benefits program creates a huge win for you as a property manager, and your investor, by driving higher ROI over time. How Can Property Managers Implement a Resident Benefits Package? If a resident benefits package is new to your company, you may wonder how best to implement it. Should you roll out a resident benefits package as part of your base service – ensuring the maximum benefits for your investor – or allow residents to opt in or out? What is legal or not? We do recommend including this as a part of the base package for all residents. Offering optional RBPs creates potential for headache, and the theoretical benefits almost never materialize. According to Second Nature's Head of Sales, Bob Hansen, “You have to look at the value that a resident benefits package brings to the investor and the resident, not just you as the property manager.” At Second Nature, we’ve seen incredibly low pushback from residents when an RBP was introduced. After all, it benefits residents, and most are delighted to have the extra service. How Can Property Managers Reduce Costs With a Resident Benefits package? The answer is: in several ways! Implementing a comprehensive residential benefits package can provide property managers with opportunities to reduce costs and increase operational efficiency. Let’s look at examples from the product above. By including air filter delivery as part of the package, property managers can ensure that residents have regular access to clean air filters, reducing the need for costly maintenance and repairs caused by poor air quality. Offering identity protection and credit-building services can help mitigate the financial risks associated with identity theft and delinquent payments, potentially reducing costs related to collections and legal procedures. They also improve retention and encourage on-time payments. Including a resident rewards program can also incentivize desirable behaviors such as timely rent payments or positive referrals, fostering resident satisfaction and reducing turnover costs. By partnering with a renter's insurance program, property managers can transfer potential liability and property damage expenses to the insurance provider, minimizing their own financial risks. A move-in concierge service can streamline the onboarding process for new residents, reducing administrative costs and improving operational efficiency. By providing these benefits, property managers can enhance resident satisfaction and retention, ultimately reducing expenses associated with turnover, repairs, and legal issues. Common Mistakes Property Managers Make in Implementing Resident Benefits Packages In our experience helping property managers implement RBPs, we’ve heard our share of concerns or even horror stories from PMs who had bad implementations with other products. Here are some of the most common mistakes in RBP implementations – and how to avoid them! 1. Overpromising and underdelivering Property managers may advertise extravagant benefits that they cannot consistently provide or fulfill, leading to disappointment and resident or investor dissatisfaction. Property managers should accurately represent the benefits package, ensuring that the offered perks are realistically achievable and consistently provided to residents. 2. Lack of communication Failing to effectively communicate the details and availability of the benefits package to residents can result in confusion and missed opportunities for using the offered perks. Property managers should effectively communicate the details, availability, and utilization process of the benefits package to residents through multiple channels, such as newsletters and online platforms. 3. Inadequate research and selection Property managers may choose benefits that do not align with the residents' preferences or needs, leading to a lack of interest and underutilization of the package. Property managers should conduct thorough market research and engage with residents to understand their preferences and needs, ensuring that the benefits selected align with their expectations. 4. Failure to evaluate cost-effectiveness Neglecting to assess the costs and benefits of the package can result in offering benefits that are financially unsustainable or fail to provide a satisfactory return on investment. Property managers should regularly assess the costs and benefits of the package, considering factors such as resident utilization, return on investment, and overall financial sustainability to make informed adjustments as needed. 5. Lack of flexibility and adaptability Not regularly reviewing and updating the benefits package based on resident feedback and changing market trends can make it less competitive and less appealing over time. Property managers should actively seek resident feedback, monitor market trends, and periodically review and update the benefits package to ensure it remains competitive and relevant to residents' changing needs. 6. Insufficient staff training Failing to train property management staff on the benefits package and its administration can lead to ineffective communication, missed opportunities, and difficulty addressing resident inquiries or issues. Property managers should provide comprehensive training to their staff on the benefits package, including its features, administration processes, and effective communication strategies, enabling them to effectively support and engage with residents. 7. Neglecting legal and regulatory considerations Property managers must ensure that the benefits package complies with all relevant laws and regulations, such as data protection requirements or fair housing laws, to avoid legal repercussions. Property managers should consult legal experts or advisors to ensure that the benefits package complies with all applicable laws and regulations, protecting both the company and residents. 8. Ineffective marketing and promotion Inadequate marketing efforts to promote the benefits package can result in low resident awareness and limited participation, reducing the overall effectiveness of the package. Property managers should develop a strategic marketing plan that utilizes various channels to promote the benefits package, highlighting its value proposition and actively engaging residents in participating and utilizing the offered perks. 9. Ignoring resident feedback Neglecting to seek and incorporate resident feedback can hinder the improvement and optimization of the benefits package, missing opportunities for enhancing resident satisfaction and retention. Property managers should establish channels for residents to provide feedback on the benefits package, actively listen to their suggestions and concerns, and make necessary adjustments to enhance resident satisfaction. 10. Lack of coordination with vendors Failing to establish clear communication and expectations with vendors offering benefits can lead to subpar service delivery, difficulty resolving issues, or missed opportunities for cost savings. Property managers should establish clear expectations, contracts, and regular communication channels with vendors offering benefits, ensuring a seamless and satisfactory service delivery process for residents and promptly resolving any issues that may arise. This is A LOT to keep in mind, and avoiding these mistakes might feel like it will cost too much or simply take too much work. But that’s why opting for a fully managed RBP is a solution so many PMCs are turning to. You can rely on a partner to manage all aspects of your RBP, and ensure it's delivering on its promises to your residents. More on that in the next section. How 1,000+ Property Managers Are Creating Triple Wins With a Resident Benefits Package Rolling out a resident benefits package is a powerful way for property managers to create a Triple Win – for residents, investors, and themselves. An RBP like Second Nature’s is designed to be simple to use and easy to implement. All the services included within it are managed externally by Second Nature, meaning there is no day-to-day upkeep required from the manager. You plug it in and Second Nature keeps it running. The value creation an RBP generates – with such little work required from the PM – is an incredibly easy way to grow your business and create great experiences that residents will pay and stay for. Don't get left behind in the evolving world of resident experience. Learn more about our fully-managed Resident Benefits Package and how we can build ease for you, your investors, and your residents. Learn More About RBP from Second Nature

September 23, 2024

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How to Write a Tenant Move-Out Letter: Thank You & Reminder + Free Templates

When it's time for a tenant to move out, sending a well-crafted letter can make all the difference in ensuring a smooth transition. Whether you're expressing appreciation for how they’ve cared for the property or simply reminding them of key dates, this communication is an important part of the rental process. Below, you’ll learn what a tenant move-out letter is, why it matters, and how to create one that leaves a positive impression. Note on language: Here at Second Nature, we like to use the term “resident” rather than “tenant” to highlight the human aspect of property management rather than the transactional. However, we’re writing this article in response to a verbatim query from one of our readers, so we wanted to reflect on their choice of language in full respect. What Is a Tenant Move-Out Letter? A tenant move-out letter, also known as a goodbye letter or termination notice, serves as an official notice to remind renters that their lease term is ending soon. Unlike an eviction notice letter, which often involves legal action due to lease violations, a move-out letter is generally more friendly and straightforward. It's a polite way of notifying your tenant about their approaching move-out date and outlining the next steps they should take to leave the property in good condition. Most move-out letters are routine and come at the end of a lease term, so they should maintain a positive tone. After all, your tenant has been living in your property for an extended period of time, and fostering goodwill—even during the process of departure—can leave both parties with a sense of satisfaction and end the current landlord-tenant relationship on a positive note. Why Send a Tenant Move-Out Letter? Sending a move-out letter offers several advantages for both property managers and tenants. Here’s why it’s a good idea: Avoiding confusion: A move-out letter provides clarity, helping both parties avoid any misunderstandings about key details like the move-out date, key return procedures, and cleaning expectations. This simple step can prevent miscommunication that could otherwise escalate into bigger issues down the line. Legal requirements: Depending on your location, a move-out letter may be a legal requirement so be sure to check state and local laws. Ensuring that all notifications are properly documented protects both parties and helps avoid unnecessary disputes. Planning and preparation: By sending a move-out letter, you give tenants enough time to prepare for their move. This allows them to schedule movers, clean the property, and organize move-out logistics, reducing the likelihood of last-minute complications. Final inspection planning: Scheduling the move-out inspection allows both you and the tenant to address any potential concerns before they depart. This process helps ensure that the property is left in good condition and that any necessary repairs or cleaning are handled promptly. Property maintenance: Including instructions in the move-out letter regarding cleaning and maintenance helps ensure that the property is returned in a suitable condition. By making your expectations clear of normal wear and tear, you can reduce the likelihood of damage or uncleanliness. Smooth transitions: A well-structured move-out process allows for efficient scheduling of maintenance issues and repairs after the tenant leaves, minimizing vacancy downtime. This quick turnaround is key to getting the property ready for the next tenant. How Are Move-Out Letters Different from Notices to Vacate? Move-out letters and notices to vacate serve different purposes. A move-out letter is a friendly courtesy reminder of a lease termination, while a formal notice to vacate often involves asking the tenant to leave the property for a specific reason, such as non-payment of rent or a violation of the lease agreement. While both letters involve tenants leaving the property, the tone and intent are very different. A notice to vacate is more formal and may involve legal repercussions if the tenant fails to comply. In contrast, a move-out notice is often seen as a courtesy to ensure that everyone is on the same page regarding the end of the lease. Read more: How to Write a Notice to Vacate Letter to Tenants [with free template] How to Write a Move-Out Letter to a Tenant When writing a move-out letter, keep it professional yet friendly. This is your opportunity to set your move-out expectations clearly while maintaining a positive relationship with your tenant. Also be sure that your letter is free of spelling and grammatical errors! If time allows, you can personalize the letter with a kind message about your experience with the tenant. Here are the essential elements to include in your letter: Date of delivery: Mark the date that the letter is being sent to document when the tenant was notified. Contact information: Make sure your contact details are easy to find so that the tenant can reach out with any questions or concerns. Tenant’s name: Address the tenant by name to make the letter feel personal and respectful. Move-out date: Clearly state the date by which the tenant needs to vacate the property, including their personal belongings. This helps avoid any ambiguity about when they should be out by. Lease agreement details: Reference the title of the lease agreement and the date it was signed to connect the letter back to the original terms agreed upon by both parties. Legal requirements: Include any local or state laws/regulations that pertain to the move-out process, such as the required notice period. Final walkthrough date: Offer a specific date and time for the final inspection of the property. This gives both you and the tenant a chance to address any concerns before they leave. Security deposit information: Provide clear guidelines on how the tenant can ensure they receive their security deposit back. You should also have their forwarding address handy. This might include information about cleaning, repairs, or any other factors that will influence the return of their deposit. Name and signature: End the letter with your name and signature to formalize the communication. Each of these elements is crucial to both providing clear instructions and maintaining a positive tone. How to Write a Thank You and Move-Out Letter Sometimes, property managers like to go the extra mile and include a thank-you note to tenants who have taken good care of the property. This small gesture can help leave a lasting positive impression and foster goodwill, even after the tenant has moved on. Here's a sample letter template: Template: Dear [Tenant Name], Thank you for being a valued tenant at [Property Name] for the past [lease term]. We appreciate you taking good care of the property throughout your tenancy. This letter serves as a reminder that your lease term ends on [move-out date]. We wish you all the best in your new home! Please refer to our previous move-out letter for a detailed breakdown of the move-out process, including final walkthrough scheduling and security deposit return information. Sincerely, [Your Name] Property Manager This letter not only reminds the tenant of the move-out process but also expresses gratitude, leaving a positive final impression. How to Write a Reminder Move-Out Letter to a Tenant A reminder letter serves as a gentle nudge to the tenant, ensuring they’re aware of upcoming deadlines and responsibilities. It's particularly useful if the tenant’s move-out date is approaching quickly, and you want to make sure everything is on track. Here’s a sample template: Template: Dear [Tenant Name], This letter serves as a friendly reminder that your lease term at [Property Name] ends on [move-out date]. We haven't yet received confirmation on your final walkthrough scheduling. To ensure a smooth transition, please contact the property management office at [phone number] or [email address] to schedule your final inspection. A detailed move-out guide outlining cleaning requirements, key return procedures, and security deposit information was previously sent to you. You can also find this information on our website at [link]. We look forward to hearing from you soon to schedule the final walkthrough. Sincerely, [Your Name] Property Manager This type of letter ensures that important details are not overlooked, helping both you and the tenant stay on the same page as move-out day approaches. Final Thoughts Writing a tenant move-out letter is a crucial step in maintaining a positive relationship with your tenants, even as they prepare to leave. By keeping the tone professional yet friendly, and including all necessary details, you can ensure a smooth transition that benefits both parties. If you’re a property manager looking to further improve the resident experience, consider enhancing your offerings with a Resident Benefits Package. You can learn more about these packages and how they can make your rental properties even more appealing at Second Nature

September 20, 2024

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How to Write a Noise Complaint Letter to Tenant + Free Template

Writing a noise complaint letter to a tenant can be one of the more challenging aspects of real estate property management, but it's a necessary step in ensuring a peaceful living environment in and around the rental property. In this blog, we'll discuss: What constitutes a noise complaint? Scenarios in which you may need to send a complaint letter Steps to take before sending a complaint letter Elements to include in the letter (along with a customizable template) How to send the complaint letter effectively What Is a Noise Complaint? Noise disturbances are not always cut and dry. Sure, the neighbor’s dad rock garage band is pretty awful, especially around happy hour, but should it be illegal? Opinions may vary! But fundamentally, a noise complaint happens when sound levels disrupt the peace and comfort of others. These disturbances can range from loud music, parties, or even frequent or loud arguments. Generally, noise complaints are about activities during designated quiet hours, typically late at night or early in the morning. There are general laws governing excessive noise levels. For instance, many local ordinances set limits on acceptable noise levels during specific times. Property owners and managers should familiarize themselves with these laws and ensure they align with any local or state regulations. Consider obtaining legal advice to ensure that you have full clarity on what constitutes a legal noise disturbance. Why You Might Need to Send a Noise Complaint Letter There are several situations where a noise complaint letter might become necessary. Some common examples include: Multiple complaints about loud noises during quiet hours. Specific complaints mentioning a resident by name or address, indicating recurring noise problems. A property manager personally identifies noise disturbances during routine inspections or visits. Today, we’ll address these common scenarios and provide guidance to property managers who may need to send one of these letters to noisy tenants. We’ll also include a customizable sample letter you can use in these cases. Related: Types of Tenant Issues and How to Deal with Them Property Manager Noise Complaint Warning Before drafting and sending a noise complaint letter, it's crucial to investigate the situation thoroughly. Rushing into sending a complaint without proper groundwork can lead to unnecessary conflict and misunderstandings, and create an uncomfortable resident experience. Identifying the source of the problem If complaints have been received from other tenants about the same individual, it's a good starting point to talk to the neighbors to confirm the issue. Evaluate these complaints in detail to gather all the necessary information such as the type of noise disturbance, when they experienced it, and how often these might occur. It might also be helpful to visit the property during reported disturbance times, although this isn't always feasible due to odd hours. Discussing the issue with the offending tenant Before issuing a formal complaint, having a conversation with the tenant can sometimes resolve the issue. Talk to them about the complaint, discuss the incident, and ask them to change this behavior. This serves as a preliminary warning, allowing the tenant to improve their behavior before further action needs to be taken, such as eviction. It also provides an opportunity for face-to-face de-escalation of the issue before proceeding to more formal corrective or legal action. Noise Complaint Warning Letter to Tenant for Noise Violation For first-time violations, issuing a warning letter requesting them to comply with quiet hours is often recommended. This letter should be polite yet firm, indicating that there has been a noise complaint (or even several) and explaining the necessary steps to mitigate future disturbances. Example of a warning letter [Your name] [Your address] [City, state, ZIP code] [Email address] [Date] [Tenant's name] [Tenant's address] [City, State, ZIP cod Dear [Tenant's name], This letter is to inform you that we have received a noise complaint regarding your residence. As per our records, the disturbance occurred on [specific date] during [quiet hours]. We kindly request you to be mindful of the noise levels to ensure a peaceful living environment for all. If the noise issues persist, further action may be taken. We appreciate your cooperation in this matter. Sincerely, [Your Name] What Should the Noise Complaint Letter Include? A well-structured noise complaint letter should contain the following elements: Notification of complaint: Explain that one or more noise complaints have occurred, and that this issue needs to be addressed. Further details: Back up your claims by providing the total number of complaints that you’ve received, and the timeframe they occurred. If the exact information isn’t available, provide some general timelines (such as “late Wednesday evening”). Legal information: If there are applicable local laws or noise ordinances, share that with the tenant, as well as how it applies to their actions. Lease agreement reference: Reference the rental agreement if it mentions noise-related laws and ordinances in detail and the consequences of not complying with them. Proposed solutions: Suggest ways to keep noises at a reasonable level and to avoid loud activities during designated quiet hours. Timeframe for compliance: Give the tenant a specific period of time to reduce their noise levels, and inform them that you’ll follow up with them. Consequences of non-compliance: Clearly state the potential consequences, such as eviction proceedings, if the noise disturbance continues. Noise Complaint Letter to Tenant Template Here’s a customizable letter template for a noise complaint: [Your name] [Your address] [City, State, ZIP code] [Phone number] [Email address] [Date] [Tenant's name] [Tenant's address] [City, State, ZIP code] Dear [Tenant's name], This letter is to inform you that we have received several noise complaints regarding your unit. The disturbances have been reported to occur during [specific dates and times]. This is in violation of the noise regulations stated in your lease agreement and local noise ordinances. We request that you reduce noise levels, especially during quiet hours, which are from [start time] to [end time]. Please take immediate action to remedy this situation. We will check in again after [specific period] to ensure compliance. If the noise disturbances continue, we may have to take further action, which could include eviction. Thank you for your understanding and cooperation. Sincerely, [Your name] How to Send the Complaint Letter to the Tenant The complaint letter can be sent via email or delivered as a hard copy. Make sure you retain a copy for your records, noting the date and method of delivery. Final Thoughts Handling noise complaints efficiently is crucial for maintaining a peaceful living environment. By following the steps outlined above and using the provided template, your property management company can address noise issues effectively and foster a more harmonious community for all renters. Learn how you can further improve the resident experience, with Second Nature’s Resident Benefits Package.

September 20, 2024

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How to Write a Tenant Welcome Letter + Free Template

When a new resident moves into your rental property, a positive first impression is the key to setting the tone for your future relationship with them. One straightforward way to do this is through a warm, well-written tenant welcome letter. In today’s post, we’ll examine the importance of this welcome letter in detail and what you should include. We’ll also provide a free tenant welcome letter template to help you get started. Note on language: At Second Nature, we prefer to say “resident” rather than “tenant,” but will use the terms interchangeably since many property managers are using long-standing document management conventions to leverage these checklists. What Is a Tenant Welcome Letter? A tenant welcome letter is a document sent by a real estate property manager to new residents prior to the move-in date. Its purpose is to: Provide important information about the property Outline expectations related to resident responsibilities Make the new residents feel both welcomed and informed Create a positive relationship between the resident and property manager The letter will typically include details about move-in procedures, contact information, property rules, and any neighborhood amenities. (Don’t worry–we’ll discuss this further in the blog.) Why Should You Send a Tenant Welcome Letter? Beyond just the all-important positive first impression, sending a tenant welcome letter has several other benefits: Highlights your brand: For property management companies, new tenants are an opportunity to showcase your brand. A well-crafted welcome letter demonstrates professionalism and shows you care about the comfort and satisfaction of their tenancy. Provides move-in instructions: Clear instructions about the move-in day (including any specific procedures or requirements) will help ease the often stressful and overwhelming process of moving into a new home. Eases the transition: By providing detailed information about utilities, local amenities, and property rules – as well as anticipating any questions your residents might have, you help them feel at home more quickly. When to Send a Tenant Welcome Letter The best time to send a new tenant their welcome letter is after both parties (the resident and property manager) have signed the lease agreement but before the resident’s move-in day. Sending the letter in between this period gives the residents enough time to review the information in detail and ask any questions before they officially move in. This is also an ideal time to inspect the property and schedule any necessary repairs before move-in day. Related: Property Management Rental Inspection Checklist If you don’t have a tenant move-in checklist, we have you covered. Check out our Tenant Move-In Checklist for a free template you can customize. What to Include in a Tenant Welcome Letter Start the relationship on a positive note by focusing on the resident’s experience. A welcome letter to tenants from property managers is pivotal to their tenancy and should include helpful information that addresses common questions or issues that may come up during the move-in process, and acts as a good reference point, as well. Property manager’s contact information Provide your contact information, including your phone number and email address, so residents know how to reach out to you for any questions or issues. Be sure to mention what days of the week and hours you’re available, and additional contacts they can reach out to if you’re not free. Details about move-in day Include specific instructions for move-in day, such as any loading zone rules and areas, moving truck parking information, or designated move-in times to make their move-in experience more convenient. Move-in checklist Offer a list of tasks the resident needs to complete before and after moving in, such as setting up utilities and obtaining renters insurance. To make their lives easier, send them a list of providers and their contact information. We’ve got you covered with a tenant move-in checklist you can modify to fit your needs. Local utilities As mentioned, within the move-in checklist, you’ll want to provide information on how to set up local utilities such as electric, gas, cable or internet, water, and sewer services. Share details about how to pay for them, as well. This should include information about local utility companies and providers to save them time. If any cost is covered by the property management company, be sure to mention it. Lucky for property managers, Second Nature offers move-in concierge services as part of their Resident Benefits Package to provide ease and convenience to residents. Learn more about our move-in concierge services. Property walkthrough Schedule a time and date for the property walkthrough, ensuring that all parties (residents and property manager) are aware of the current condition of the property before move-in day. Related: Rental Inspection Checklist Key collection details Inform the resident where they can go to pick up the keys to their new home, as well as when–what days of the week and during your business hours. If they can’t pick up the keys during your preferred time, provide a contingency plan for key pickup. Renters insurance Remind residents to provide proof of renters insurance (if it’s required), and be sure to link to specific resources that explain the benefits of renters insurance. Second Nature offers renters insurance as part of our Resident Benefits Package. Learn more about Second Nature’s renters insurance. Rent payment Explain when rent payments are due, as well the full rent amount is on a monthly basis and the payment methods available (such as an online portal). Share information about what late fees are if rent isn’t paid on time. Maintenance issues Outline the procedure for maintenance requests and provide emergency contact information for plumbing, HVAC, or electrical problems. See also: Preventive Maintenance Checklist for Property Management. Trash collection and recycling Provide information on where to dispose of trash and recycling, as well as collection days and any special disposal instructions, such as for bulk items. Parking information Explain parking arrangements for tenants, as well as any of their guests. This could include information about permits or designated spots. Neighborhood information Share information about local grocery stores, parks, gas stations, public transportation, and local attractions to help residents get familiar with their new neighborhood. Overall tenant responsibilities Reiterate key responsibilities, such as any necessary minor repairs and upkeep, to ensure residents are aware of their duties. (These will already have been outlined in the rental agreement, but it doesn’t hurt to reference them here.) Property rules Summarize the property rules and regulations, and be sure to refer to the lease agreement for detailed descriptions. Tenant Welcome Letter Template Below is a tenant welcome letter example you can use or customize to suit your unique needs: [Property Manager's Name] [Property Management Company] [Address] [City, State, ZIP Code] [Phone Number] [Email Address] [Date] Dear [Tenant's Name], Welcome to [Property Name/Address]! We are excited to have you as a new resident. To help you settle in, we’ve put together this welcome letter with important information and resources. Move-In Day Details: Move-in Date: [Date] Move-in Time: [Time] Loading Zone Rules: [Details] Contact Information: Property Manager: [Name] Property Management Company: [Name] Phone: [Phone Number] Email: [Email Address] Key Pick-Up: Date and Time: [Date and Time] Location: [Location] Utility Set-Up: Electric: [Provider Contact Information] Gas: [Provider Contact Information] Cable/Internet: [Provider Contact Information] Water: [Provider Contact Information] Sewer: [Provider Contact Information] Rent Payment: Monthly Rent: [Amount] Due Date: [Due Date] Payment Method: [Online Portal/Other] Maintenance Issues: Report Issues: [How to Report] Emergency Contacts: [Contact Information] Trash and Recycling: Location: [Details] Collection Days: [Days] Parking Information: Tenant Parking: [Details] Guest Parking: [Details] Neighborhood Information: Grocery Stores: [Details] Parks: [Details] Public Transportation: [Details] Local Attractions: [Details] Tenant Responsibilities: [Responsibilities] Property Rules: [Summary of Rules] We hope this information helps you settle in comfortably. If you have any questions or need assistance, please don't hesitate to contact us. Best regards, [Property Manager's Name] [Property Management Company] How to Send a Tenant Welcome Letter Email is the most efficient method of sharing the welcome letter since it ensures prompt delivery and allows residents to reference the information easily. It’s also good practice to provide a printed copy of the welcome letter upon move-in. You can simply leave it on the kitchen counter or another visible spot in their new home. Final Thoughts A tenant welcome letter is a simple yet powerful mechanism for enhancing the resident experience, fostering a positive relationship, and showcasing your brand. Ultimately, by providing essential information and a warm welcome, you are setting the stage for a smooth move-in process and a happy residency. For more ways to improve the resident experience, check out our Resident Benefits Package.

September 20, 2024

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How to Help Residents Use Their Identity Protection Services During a Data Breach

With personal data becoming increasingly valuable to bad actors, data breaches are unfortunately becoming a regular occurrence. The situation is particularly alarming at a time when cybercriminals are arming themselves with more sophisticated technology. Exhibit A is the recent theft of personal records belonging to 2.9 billion people from National Public Data. We’ll get into the details in a moment, but first let’s note that property managers are in a unique position to help residents respond to breaches, particularly when residents’ confidential information may have been exposed. As a property manager, knowing how to guide your residents through using identity protection services can make a big difference in minimizing the damage resulting from the breach. In today’s blog, we will cover: What a data breach is and how it affects property managers and their residents Steps to take to determine if your property management company and your residents are affected Key actions to help residents protect themselves after a breach How preventative measures, including identity protection services like Aura, can help safeguard personal information in the future About the Data Breach Data breaches occur when unauthorized persons or organizations gain access to sensitive personal information. A recent breach involving the hacking group USDoD targeted National Public Data, exposing the personal records of 2.9 billion people. This massive breach serves as a wake-up call for property managers and property management companies, as sensitive information such as names, addresses, contact information, Social Security numbers, driver’s license numbers, passport numbers, and financial records can be used by criminals to commit identity theft, fraud, and other crimes. Even more alarming, stolen data can include biometric data, healthcare and medical information, and financial account information (such as debit card numbers and bank account numbers). In short, any and all computerized data comprising of all types of personal information can be breached. The costs of data security breaches associated with personally identifiable information add up pretty quickly. In fact, recent years have seen a spike in the costs associated with cybercrime, likely because more and more organizations and financial institutions are opting to conduct high-value business transactions online (see image below). Unfortunately, despite consumer protection and data privacy legislation, civil penalties, and law enforcement’s best efforts, criminal investigations are often hampered by jurisdictional issues, as cybercriminals don’t respect international borders! For property managers, this type of cybersecurity breach is especially concerning because of the vast amount of personal information they collect and store about their residents. The thing is, data breaches like this don’t just affect the residents directly. They can also lead to a breakdown of trust between residents and property managers. Being prepared to act quickly and effectively in the wake of a breach is essential to mitigating the damage and helping residents protect their identities. Are You Affected by a Data Breach? If you manage properties that involve storing confidential resident information, it’s crucial to determine whether your company was affected by a breach. Here’s how you can figure that out: Confirm details about the data breach Start by verifying whether your property management company was impacted by unauthorized access to information. This means reaching out to the breached organization directly (in this case, National Public Data) for more information and confirming whether any of your residents are among the affected individuals. Beware of phishing attempts. Cybercriminals might try to trick you into believing your company has been affected when it hasn’t. Scammers may pose as the breached organization, sending fake notifications via email or phone. Always double-check the validity of any such communications. These often include unfamiliar email addresses, spelling and grammatical errors, and links to unknown URLs. In some cases, residents may contact you directly after receiving notifications about the breach. Make sure you have accurate, verified information to provide them, ensuring they don’t fall prey to scammers who may exploit the situation further. Above all, stay calm and be patient when communicating with residents. Determine what information was stolen Once you’ve confirmed a breach, the next step is figuring out what type of information was stolen. Was it just email addresses, telephone numbers, and names, or were more sensitive details exposed, like Social Security numbers, identification card numbers, credit card information, health information, or home addresses? The more you know about the nature of the breach, the better you can help your residents respond appropriately. For example, if a breach only involved email addresses, the threat might be lower than if Social Security numbers were leaked. However, if highly sensitive data is exposed, residents will need to take more substantial steps to protect themselves. What You Can Do After a Data Breach Once you’ve received a security breach notification indicating that your property management company and residents have been affected by a breach, you’ll need to notify your residents immediately and offer them guidance on what to do next. Here are the essential information security steps you can recommend: Change passwords Encourage residents to change all passwords and personal identification numbers (PINs) associated with their accounts, especially if they use the same credentials across multiple platforms. It’s also a good idea to recommend a password manager to help them create and manage secure passwords. However, be cautious in suggesting a password manager—only recommend ones with a solid track record and no history of breaches themselves. Additionally, advise residents to enable two-factor authentication (2FA) on all accounts that offer it. This extra layer of security requires a second form of identification (like a text message or authentication app) that provides an access code in addition to a password, making it more difficult for hackers to access their accounts. Remove personal information from data brokers Data brokers are companies that collect and sell personal information and data elements, often without individuals being fully aware of it. This information can include everything from names and addresses to purchasing habits and online behaviors. Unfortunately, during a data breach, the information collected by these brokers can be exploited by hackers, making it easier for criminals to commit unauthorized acquisition of data – and subsequently, fraud. Encourage residents to take the next step of removing their personal information from these brokers' databases. Several online services allow individuals to opt out of data broker lists, but it often requires a proactive approach. Residents may need to contact these brokers directly or use opt-out services such as OptOutPrescreen.com or Do Not Call lists to ensure their data is no longer being distributed. While this process can be time-consuming, it adds another layer of protection, reducing the amount of personal information circulating online and making it harder for hackers to misuse. Contact credit bureaus to freeze or lock your credit Another important step residents should take is freezing or locking their credit. This prevents scammers from opening new accounts in their names. Freezing credit involves contacting the three major credit monitoring services—Experian, Equifax, and TransUnion—and requesting that their credit be locked. This way, even if a hacker has stolen their personal information, they won’t be able to take out loans or apply for credit cards using that information. Additionally, residents can initiate a fraud alert with credit reporting agencies, to warn creditors that their information may have been stolen. Delete old accounts Another important step in minimizing the risk of identity theft is deleting old, unused online accounts. These accounts, often forgotten, can contain sensitive personal information that hackers can exploit in the event of a data breach. Residents may have accounts from years ago with shopping sites, social media platforms, or other services that still store their data. Encourage residents to review and close any accounts they don’t use anymore. They can start by checking for accounts tied to old email addresses, searching for accounts that use their email or phone number, or even using tools like Mine, which can help locate inactive accounts. By eliminating these forgotten accounts, residents reduce the number of potential entry points for hackers and strengthen their overall security. It’s a simple but highly effective way to protect personal data and limit exposure to future breaches. Monitor active accounts Remind residents to closely monitor their financial and online accounts for any signs of suspicious activity. This includes regularly checking credit reports, bank statements, and any unfamiliar credit inquiries or new accounts. Any strange emails, phone calls, or texts asking for sensitive information should be treated with caution. If any fraudulent activity is detected, advise residents to file an identity theft report with the Federal Trade Commission (FTC) through IdentityTheft.gov. This will allow them to take immediate action to stop any further damage to their personal information. What to Do to Prevent Data Breaches While dealing with a breach is stressful, there are steps that both property managers and residents can take to reduce the chances of a breach happening again. One of the most effective ways to do this is by using a trusted identity protection service like Aura, in addition to a Resident Benefits Package. Aura is Second Nature’s partner in providing residents with comprehensive protection. Aura identity monitoring Aura offers an extensive suite of identity protection services that can help property managers and residents stay ahead of potential breaches. Some of the services provided by Aura include: Financial fraud protection: This monitors residents’ financial activity for any signs of fraudulent transactions or unusual changes in their accounts. Identity theft protection: Aura scans a variety of sources, including the dark web, for compromised personal information, alerting residents if their data is found. Antivirus and VPN: These tools help keep residents’ devices safe from viruses, malware, and other types of cyberattacks. Parental controls and scam call protection: This is particularly useful for residents with families, offering extra layers of security for children and elderly relatives who may be more susceptible to scams. By offering a service like Aura as part of your property management’s Resident Benefits Package, you can give your residents the protection they need to safeguard their identities and personal information. Final Thoughts Helping residents protect their personal information is a responsibility that property managers must take seriously, especially in the wake of recent data breaches. Aura, a trusted identity protection service, offers a solution to the growing problem of identity theft, providing both residents and property managers with peace of mind. For property managers, incorporating Aura into your Resident Benefits Package is a practical and effective way to improve the overall resident experience while ensuring that their data is protected. Aura offers identity theft insurance of up to $1,000,000, making it an attractive option for residents looking to protect themselves from fraud. Its 14-day free trial is an easy way to see if the service is right for you. By being proactive and offering these services, you not only reduce the potential damage of a breach but also build stronger relationships with your residents, giving them the tools they need to safeguard their information for the long term. Learn more about how you can improve the resident experience through Second Nature’s Resident Benefits Package.

September 20, 2024

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How to Write a Security Deposit Return Letter + Free Template

Returning a security deposit is one of the final steps in a tenancy relationship, and it's important to handle it properly. Indeed, knowing how to write a security deposit return letter can help you close things out smoothly and professionally. Today we’re presenting a practical guide on crafting these letters, complete with examples and essential details to keep in mind. Important note: While this guide offers helpful general advice, it’s vital to check local and state laws to ensure compliance with specific regulations in your area. Note on language: Here at Second Nature, we prefer the term “residents” rather than “renters” or “tenants,” as that emphasizes the human element over the transactional. But because formal property management documentation often makes exclusive reference to “tenants,” we’ll favor that term in today’s post. What Is a Security Deposit Return Letter? A security deposit return letter serves as formal documentation that details the return of the security deposit to the resident after they move out. It's more than just a formality – this letter can clarify the amount being returned, explain any deductions, and provide transparency to avoid deposit disputes. When done correctly, this letter can help you avoid potential claims against the deposit. It’s also a chance to demonstrate professionalism and fairness, which can lead to positive relationships and, potentially, good word-of-mouth in the future. Here are a few things to keep in mind when crafting a security deposit return letter: State laws: Local laws dictate the time frame in which a tenant’s security deposit must be returned, what deductions are allowed, and any other related requirements. Preventing disputes: A well-crafted letter can help prevent claims against you by clearly outlining the return process and any deductions made. Insurance considerations: In some cases, following the correct procedures for returning a deposit can also help you avoid issues with any insurance policies you may have in place in relation to security deposits. Related: What is Security Deposit Insurance: Pros, Cons, and Best Practices? Common Questions About Security Deposit Returns Handling security deposits can be tricky, and questions often arise. Below are a few common concerns landlords and property managers face. Keep in mind that local and state laws vary, so always consult the relevant regulations. What can a landlord or property manager deduct? You can generally deduct unpaid rent, repairs for damages beyond normal wear and tear, and costs for cleaning if the unit is left in poor condition. However, these deductions must be reasonable, and you should always provide documentation, such as receipts or photos, to support them. What is considered normal wear and tear? Normal wear and tear typically includes things like minor scuffs on walls, light carpet wear, or small nail holes from hanging pictures. Essentially, it refers to the natural aging of a property during normal use. Anything beyond this—like large stains, broken fixtures, or damage from pets—may warrant deductions from the security deposit. When should you return the security deposit interest? In some states, landlords are required to pay accrued interest on the security deposit. If this applies to you, check the relevant deadlines and ensure you include any owed interest along with the returned deposit. You’ll need to itemize this in your letter as well. What if you don’t have a forwarding address? If the resident hasn't provided a forwarding address, it’s still your responsibility to attempt to return the deposit. Try reaching out through any available means, such as email or phone. If all else fails, you may need to follow state-specific protocols, such as holding the deposit for a set period. Learn more: Security Deposit Alternatives for Property Managers and Residents What to Include in a Security Deposit Letter A well-organized letter should cover all the necessary information, presented in a clear and concise manner. Here’s a breakdown of the key elements you’ll want to include: Landlord's name and contact information: Your full name (or the name of your property management company) and how you can be reached. Tenant’s name and contact information: Make sure to address the letter to the correct person in relation to the correct property address. Date of letter: This is important for record-keeping, as well, and signals what day the notification was shared. Lease details relevant to the deposit: Reference the deposit or lease agreement that applies (you can also provide a copy of the relevant agreement). Original deposit amount: Clearly state the original amount of the security deposit. Itemized breakdown of deductions: If any deductions were made, list them here with the corresponding amounts and explanations. Receipts or documentation for deductions: Include copies of cleaning, repair, or maintenance receipts as proof of expenses. Remaining balance: Indicate the amount being returned after deductions. Deposit details: Mention how and when the deposit will be returned (e.g., check, direct deposit). Signature: Ensure that the letter is signed by you or an authorized representative from your property management company. How to Write a Landlord Security Deposit Letter Security deposit letters can take different forms depending on the situation. Here’s a brief overview of the most common types and when to use them: Security deposit letter for full refund: If you’re returning the full amount of the deposit without any deductions, this is the easiest letter to write. A straightforward explanation, along with the original deposit amount, is all that’s needed. Security deposit letter for partial refund: In cases where part of the security deposit is being withheld for cleaning, repairs, or unpaid rent, your letter will need to include an itemized list of these deductions. Be clear and provide any supporting documentation. Security deposit letter for no refund: If the entire deposit is being withheld, your letter should carefully explain why. Be sure to include receipts and a detailed breakdown of the costs involved, as this can help prevent disputes. Security deposit letter with request for payment: If the security deposit isn’t enough to cover the damages or unpaid rent, you may need to request additional payment. This letter should include a full explanation of the costs and a deadline for payment. Below are sample letters for these scenarios: Sample letter: Security deposit letter for full refund [Your Name] [Your Address] [Date] Dear [Resident’s Name], This letter serves as confirmation that your security deposit of $[Amount] is being returned in full. Thank you for leaving the rental property in good condition. Please find the enclosed check for the total amount of your deposit. Sincerely, [Your Name] [Your Contact Information] Sample letter: Security deposit letter for partial refund [Your Name] [Your Address] [Date] Dear [Resident’s Name], After inspecting the property, we’ve determined that $[Amount] will be deducted from your security deposit for the following reasons: [Itemized list of deductions and costs] Please find the enclosed check for the remaining balance of $[Remaining Amount]. Receipts for the deducted amounts are attached for your records. Sincerely, [Your Name] [Your Contact Information] Sample letter: Security deposit letter for no refund [Your Name] [Your Address] [Date] Dear [Resident’s Name], After inspecting the property, we’ve determined that the entire security deposit of $[Amount] will be used to cover the following costs: [Itemized list of deductions and costs] Unfortunately, no balance remains to be refunded. Receipts for the deducted amounts are attached for your records. Sincerely, [Your Name] [Your Contact Information] Sample letter: Security deposit letter with request for payment [Your Name] [Your Address] [Date] Dear [Resident’s Name], After inspecting the property, we’ve determined that the cost of repairs and unpaid rent exceeds your security deposit of $[Amount]. The remaining balance of $[Balance Due] is owed to cover the following: [Itemized list of deductions and costs] Please remit payment by [Due Date]. Receipts for the deducted amounts are attached for your records. Sincerely, [Your Name] [Your Contact Information] How to Send a Tenant a Security Deposit Letter The best way to send a security deposit return letter is by certified mail with a return receipt. This ensures that there’s proof of delivery, which can protect you in case of disputes. Some states may also allow you to send the letter electronically, so check local regulations to confirm the appropriate method. Mistakes to Avoid When Writing a Security Deposit Return Letter When writing a security deposit return letter, be mindful of some of the common pitfalls below. Failure to meet the deadline Every state has specific rules about how long you have to return a deposit, broadly ranging from 10 days after inspection (as in the case of Montana) to 60 days (West Virginia and other states). Missing the deadline can result in penalties. Not providing enough detail If you’re making deductions, be sure to include detailed explanations and supporting documentation, as specified earlier. Neglecting to include interest In states where interest on security deposits is required, make sure you calculate and include it in the return. It’s best to document this early on to save yourself a headache down the road. Not retaining a copy Always keep a copy of the letter and any related documents for your records. It helps to also back up electronic documents, as well, but be sure to keep original copies of everything first. Final Thoughts Handling security deposit returns correctly can help you avoid disputes and maintain good relationships with residents, even after they’ve moved out. By following these guidelines and customizing your letters to fit the situation, you’ll be able to navigate this process smoothly and professionally, while ensuring a positive experience for all parties. For more tips on improving the resident experience, check out Second Nature’s Resident Benefits Package.

September 19, 2024

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How to Write a Pet Violation Letter to Tenants + Free Template

Dealing with pets in rental properties can be tricky. While our furry friends bring comfort and joy to many, they can also cause issues for property managers as well as property owners. That’s why it's essential to address the situation professionally and promptly when a tenant brings in an unauthorized pet. In this blog, we’ll discuss: What a pet violation letter to the tenant is The process of confirming an unauthorized pet lease violation How to write a pet violation letter to the tenant And bonus: we’ll share a free pet violation letter to tenant template you can customize to help you through the process. Note on Language: At Second Nature, we like to say “resident” rather than “tenant,” but will use the terms interchangeably since many property managers have official terminology around these templates. What Is a Pet Violation Letter to Tenant? A pet violation letter is a formal notice sent to tenants when they’ve violated the terms of their lease agreement by having an unauthorized pet. This type of letter serves to notify the pet owner of the violation and the consequences of not resolving it. The primary goal is to ensure compliance with the lease while maintaining a respectful and professional relationship with the tenant. The letter is typically sent after a property manager has confirmed that a tenant is keeping an unauthorized pet in their rental unit. This can be an issue when a lease explicitly prohibits pets, or when a pet does not meet specific criteria outlined in the lease, such as size or breed restrictions. (Note that while dog breeds often associated with aggressive behavior include pit bulls, dobermans, German shepherds, and others - actual breed restrictions vary by state). Put simply, unauthorized pets are animals kept by tenants without the property manager's consent. This issue can arise for a variety of reasons, including the tenant's desire to avoid pet deposits, fees, or restrictions, or simply because the tenant wasn't aware of the rules. Regardless of the cause, it’s important to address the situation before it escalates. Property managers might enforce a no-pets rule for several reasons, including protecting the property from potential damage, minimizing noise, or reducing allergens that might affect future tenants. There are also legal considerations to keep in mind, especially regarding service animals and emotional support animals (ESA), which we’ll cover later in this post. Pet violation in the lease agreement A rental agreement often includes a pet policy outlining what is and isn’t allowed. Some common restrictions might include weight limits, breed restrictions, and behavioral requirements. For instance, lease terms might allow pets under 25 pounds or prohibit aggressive breeds. There could also be rules about how many pets are allowed or requirements for pet insurance. Property managers have the right to enforce no-pets policies, and this is generally supported by law. However, enforcement must be consistent and in line with the lease agreement. If a tenant violates the pet policy, the property manager can request that the pet be removed or even take legal action if the tenant refuses to comply. An important caveat is that you need to be familiar with state laws as well as federal laws regarding pets. Service animals, for example, are protected under the Americans with Disabilities Act (ADA). This means that even if your lease has a no-pets policy, you must accommodate service animals without charging additional fees. Emotional support animals are a bit different from service animals – they’re protected under the Fair Housing Act, but property managers are allowed to ask for proper documentation. As a disclaimer, we urge you to obtain legal advice to ensure you are not stepping on any local regulations, as this blog post does not constitute formal legal guidance! Related: If you do offer pets in your rental property, check out our blog - Pet Policy for Renters: Best Practices for Property Managers to find out more. Examples of unauthorized pet scenarios Unauthorized pets can cause a range of issues, from minor inconveniences to significant property damage. Here are a few examples of common scenarios: Odors: Pets, particularly dogs and cats, can leave behind strong odors that linger in a rental unit long after they’re gone. These smells can be tough to eliminate and may require professional cleaning. Fur: Pet fur can accumulate on carpets, furniture, and air ducts, leading to additional cleaning expenses. Damage: Pets can cause visible damage to a rental unit. Dogs might chew up carpet or scratch wood floors, while cats could damage walls or furniture. It’s important to document these issues when addressing unauthorized pets. Clear evidence will help you communicate the problem to the tenant effectively, as well as help you deal with any ramifications around security deposits. Exceptions to the rule Not all pets can be treated the same under the law. Service animals and ESAs have special protections that property managers must respect. A tenant with a disability is entitled to keep a service animal, even if the property has a no-pets policy. These animals are not considered pets but rather essential aids for their owners. Emotional support animals are slightly different. While they don’t have the same legal status as service animals, property managers must still make reasonable accommodations under the Fair Housing Act. If a tenant provides a valid ESA letter from a licensed mental health professional, the property manager must allow the animal unless it poses a direct threat to the safety of others or causes significant property damage. When presented with an ESA letter, be careful not to overstep privacy laws when verifying its legitimacy. A respectful approach is key to maintaining a good relationship with the tenant while upholding the property’s rules. Related: Pet Screening 101: How Top Property Managers Do It Confirming an Unauthorized Pet Lease Violation Before sending out a pet violation letter, it’s essential to confirm that the tenant is actually in violation of the lease agreement. This might involve observing the pet directly, collecting evidence from neighbors, or discovering signs of a pet in the unit, such as fur or odors. Once you have confirmed the violation, check the lease to ensure the tenant is aware of the policy they’ve breached. When addressing unauthorized pets, start by communicating clearly with the tenant. Explain the violation and give them an opportunity to correct the issue. In some cases, a simple conversation can resolve the problem without the need for a formal cure or quit notice. If the tenant refuses to comply, you may need to take further action, such as issuing a formal pet violation letter or, in extreme cases, beginning the eviction process. Writing a Pet Violation Letter to the Tenant When crafting a pet violation notice, clarity and professionalism are crucial. Here are the key elements that should be included: Tenant’s information: Start with the tenant’s name, address, and the date of the letter. Violation description: Clearly state the violation, including the specific pet policy they’ve breached. Mention the lease agreement and the relevant clauses. Evidence: Include any evidence you’ve gathered, such as photos or reports from neighbors. Resolution options: Outline what the tenant needs to do to resolve the issue, whether that means removing the pet or paying additional fees. Deadline: Provide a deadline for compliance. This gives the tenant a clear timeframe to address the violation. Consequences: Explain the consequences of failing to comply, such as fines or legal action. Contact information: Include your contact information for any questions or concerns. Here’s a template to guide you through the process. Pet Violation Letter to Tenant Template [Your Name] [Your Address] [City, State, ZIP Code] [Phone Number] [Email Address] [Date] [Tenant’s Name] [Tenant’s Address] [City, State, ZIP Code] Dear [Tenant’s Name], This letter is to inform you that we have discovered a violation of your lease agreement regarding pets. Our records indicate that you currently have an unauthorized [type of pet] in your rental unit at [property address]. According to your lease, pets are not permitted without prior approval and proper documentation. We have attached evidence of this violation, including [brief description of evidence]. Please review your lease agreement, specifically [mention relevant section], which outlines our pet policy. To resolve this issue, we request that you [describe resolution, e.g., remove the pet from the premises or provide the necessary documentation]. Please comply with this request by [insert deadline], or further action may be taken, including fines or legal proceedings. If you have any questions or would like to discuss this matter further, please do not hesitate to contact us at [phone number or email]. We appreciate your prompt attention to this matter and hope to resolve it as soon as possible. Sincerely, [Your Name] [Title] [Company Name] If this is the first violation, a warning letter may suffice and can leave space for a humane and respectful resolution. In this case, follow up with a check-in after a suitable period. If the tenant has failed to comply, follow up with a more formal notice and be prepared to escalate the situation as needed, up to and including an eviction notice. Final Thoughts Managing a rental property comes with many responsibilities, and handling unauthorized pets is just one of them. By staying on top of these issues and communicating clearly with tenants, you can protect your property while fostering a positive tenancy experience for the resident. For more tips on improving the resident experience, learn about Second Nature’s Resident Benefits Package.

September 19, 2024

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Tenant Screening Checklist: Free Template, Printable PDF, and Form Example

When it comes to renting out a property, selecting the right tenant to take up residence can make all the difference in your experience as a property manager. While this might seem like a simple process at first glance, tenant screening is a multi-step journey that can save you from a host of headaches, when done correctly. That’s why developing a checklist to thoroughly address the full range of tenant screening considerations can streamline the process for everyone involved. Note on language: Here at Second Nature, we prefer the term “resident” rather than “tenant,” as that emphasizes the human element over the transactional. But because legacy property management systems and documentation often make exclusive reference to “tenants,” we’ll favor that term in today’s post. Related: How to Write a Tenant Welcome Letter + Free Template What Is a Tenant Screening Checklist? At its core, a tenant screening checklist is simply a tool designed to help property managers vet potential renters. It's a systematic way to ensure that you're gathering all the information required to make an informed decision about who will be living on the rental property you’re responsible for. The checklist includes a range of steps, from gathering contact information and employment details to running background and credit checks. The goal is to cover your bases so that when you hand over the keys, you feel confident that the person moving in will be a good fit for your property. Some of the typical components of a tenant screening checklist include: Rental application: This is where prospective renters provide their contact information, employment history, rental history, and more. Credit report: A detailed credit check gives you a glimpse into how financially responsible the applicant is. Background check: Criminal history is another factor that can play a significant role in your decision-making process. Reference checks: Talking to previous property managers, landlords, or employers can provide insight into how reliable the applicant is. Employment verification: Verifying that the applicant is gainfully employed and can afford the rent is crucial. Why you should use a tenant screening checklist A tenant screening checklist is more than just a series of steps to follow – it's a protective measure for your property and investment. Here's why it matters: For property managers: It ensures consistency. Every applicant is subjected to the same process, which not only helps you find the best fit for your rental property, but also legally protects you by showing that you treat all applicants equally. For potential residents: It fosters trust. Prospective renters know that if they're accepted, they earned their spot fairly, based on the same criteria as everyone else who applied for the rental property. This can create a stronger property manager-resident relationship from the outset. By sticking to a checklist, you avoid oversight or bias, and ensure that the process is transparent and fair. What property managers should know As you implement your tenant screening process, there are a few key areas that require special attention. First, familiarize yourself with the Fair Housing Act. This federal law prohibits discrimination in housing-related activities based on race, color, national origin, religion, sex, family status, or disability. Violations of this law can lead to severe legal consequences, so it's essential to understand and comply with all its provisions. Privacy is another critical consideration. The information you gather during tenant screening is sensitive and should be treated with the utmost care. Personal details like social security numbers, credit reports, and employment verification should be kept confidential to prevent identity theft and other security breaches. Consent is also vital. Make sure you obtain written permission before running background or credit checks on applicants. Not only is this a legal requirement, but it also helps build trust with potential residents by showing that you respect their privacy. Learn more: Your Guide to Property Management Laws, Regulations, & Rules How to Properly Screen Prospective Tenants There are several essential steps to a thorough tenant screening process. We'll walk through each of them in detail, but note that meeting the tenant in person, or connecting with them via phone or email, can also be helpful in assessing their suitability. Importantly, we’ll also highlight the contents of the rental application, which is crucial for gathering essential details like contact information, employment history, and rental history. It’s also where you’ll obtain permission to run background checks and credit reports, a legal requirement before proceeding with these evaluations. Now let’s take a closer look at each element of a thorough tenant screening process: Rental application The rental application is the first step in gathering essential details about a prospective resident. This form typically includes their full name, contact information, employment history, and rental history. Additionally, you may want to request a photo ID as part of this step. The rental application is also where you should ask for permission to run background and credit checks. Without consent, you're legally prohibited from conducting these checks, so this step is crucial. Income and employment verification Once you've received the rental application, verifying the applicant's employment and income is the next logical step. Pay stubs, employment verification letters, or a quick call to the employer can confirm that the applicant is both employed and earning enough to comfortably afford the rent. It’s essential to establish whether the applicant has a stable job that’ll allow them to meet their financial obligations. Consistency in employment is often a good indicator of a responsible resident. Credit check and credit report A credit check provides insight into an applicant's financial habits. Are they consistently paying their bills on time, or do they have a history of missed payments? While no one is perfect, this step can help you gauge the likelihood of timely rent payments. Before running a credit check, make sure that the applicant is aware and has provided written consent. Background check A background check can reveal any criminal history that might affect your decision to rent to a particular individual. It’s not just about finding out if someone has a criminal record – it’s about understanding the nature of any incidents and whether they present a risk to the property or the community. While it’s essential to take this information into account, it’s also important to comply with state and federal laws that govern how criminal history can be used in housing decisions. Rental history Checking an applicant's rental history is another key step in the screening process. Contacting previous property managers or landlords can provide a wealth of information, from whether rent was paid on time to how well the applicant maintained the property. Public eviction records can also give you insight into whether the individual has a history of problems with previous rentals. Reference checks Requesting references from previous rental or employment experiences can give you further insight into an applicant's character and reliability. Personal references can be helpful, but professional references tend to provide more objective feedback. Pet screening If your property allows pets, it's important to include a pet screening process as part of your checklist. This can involve gathering information about the type of pet, breed, and size, as well as providing an opportunity to review any rules or restrictions you might have regarding pets on your property. For a more in-depth look at the process of screening for the ideal tenant, check out our blog: How to Screen Potential Tenants: Tips for Property Managers. Next Step: How to Evaluate Applicants Once you've gathered all the information from your checklist, it's time to evaluate your applicants. Look for any red flags that might indicate future issues, such as a history of evictions, inconsistent employment, or a poor credit score. At this stage, you might also want to conduct an interview with your top candidates to ask any final questions and clarify details. This conversation can reveal important information that didn't come up during the formal application process. Once you’ve made your decision, it’s time to notify the applicant. If they’re approved, the next step is to provide a lease agreement for their review. Make sure to discuss the lease terms in detail and give them the opportunity to ask questions before they sign. This step is crucial for preventing misunderstandings down the road. Learn more about next steps: How to Create Your Tenant Move-in Checklist, Tips + Free Template What is a Resident Benefits Package? Tenant Screening Checklist Template The checklist below covers the process for screening potential tenants from beginning to end, and will help ensure that you are missing no crucial steps: Rental application Provide rental application form Collect full name, contact information, employment history, and rental history. Request a copy of the applicant's photo ID. Obtain consent for background and credit checks. Review rental application Confirm that all necessary fields are completed. Verify the accuracy of provided information (e.g., contact details). Income and employment verification Verify income and employment Request pay stubs or employment verification letters. Optionally, call the employer to confirm details. Ensure the applicant's income can comfortably cover the rent. Assess employment stability Look for consistency in employment history. Consider the nature and duration of current employment. Credit check and credit Report Run credit check Confirm written consent from the applicant is on file. Evaluate credit history, focusing on payment habits and outstanding debts. Identify any red flags, such as missed payments or high levels of debt. Background check Conduct background check Ensure legal compliance with state and federal regulations. Review criminal history for any potential risks to the property or community. Document findings in accordance with Fair Housing laws. Rental history Contact previous landlords or property managers Verify rent payment history (e.g., on-time payments). Check how well the applicant maintained previous rental properties. Investigate public eviction records, if applicable. Reference checks Request professional references Contact provided references to verify the applicant's character and reliability. Prefer professional references over personal ones for objective insights. Pet screening (if applicable) Gather pet information Request details about the pet(s), including breed, size, and any specific needs. Review and communicate property rules and restrictions regarding pets. Confirm the applicant’s acknowledgment of pet policies. This checklist should guide property managers and landlords through each step of the tenant screening process to ensure thorough and legal compliance. Tenant Screening Checklist Form A good tenant screening checklist form will include all of the components discussed above. Here is a sample that you can use or customize according to your needs and legal requirements: Tenant Screening Checklist Template Property Information: Property Address: Unit Number: Rent Amount: Security Deposit: 1. Pre-Screening Questions Preferred Move-in Date: Reason for Moving: Length of Previous Tenancy: Number of Occupants: Pets (Yes/No): Smoking (Yes/No): Employment Status: Monthly Income: Criminal History (Yes/No): 2. Application Information Completed Rental Application (Date received: ) Application fee collected: (Amount: ) 3. Identity Verification Photo ID received: (Type: ) Verified Name, Date of Birth, and Address 4. Income & Employment Verification Income Documentation Provided: Pay Stubs (Last 3 months) Bank Statements (Last 3 Months) Tax Returns (If Self-employed) Employer Contact Information: Employer Name: Contact Name & Position: Phone/Email: Verified Employment and Income (Yes/No): 5. Rental History Verification Previous Landlord Contact Information: Landlord Name: Phone/Email: Length of Tenancy: Rent Payment History: Any Damages or Issues Reported: 6. Credit Check Credit Score: Credit Report Reviewed (Date): Any Negative Marks: (Late Payments, Collections, etc.) 7. Background Check Criminal Background Check Completed: (Yes/No) Eviction History Check Completed: (Yes/No) Any Red Flags: 8. Additional Documents/Considerations Co-Signer Required (Yes/No): Co-Signer Information Verified: Additional Documents Provided: 9. Approval/Denial Decision Approval Decision Date: Denial Decision Date: Reason for Denial (if applicable): 10. Follow-Up Lease Agreement Sent (Date): Security Deposit Collected (Date): First Month’s Rent Collected (Date): Final Thoughts Tenant screening may seem like a complex process, but with a clear checklist in hand, you can navigate it smoothly. By staying organized, adhering to legal requirements, and keeping the lines of communication open with applicants, you'll be able to more efficiently find the best fit for your property, and set the tone for a positive resident experience all around. For more tips on improving the resident experience, check out Second Nature’s Resident Benefits Package.

September 19, 2024

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How to Write a Letter Notifying Your Tenant of the Sale of Property

Selling a rental property can be complex, especially when tenants are involved. But there are plenty of ways to notify your tenant of the sale in a clear, respectful, and legally compliant manner that also reduces their anxiety or concerns. In today’s blog, we’ll provide a practical walkthrough to help you draft this important letter, including: What a notice of sale of property letter is Rights of tenants when the property owner sells the property What the sale of property letter should include Sample letter to notify tenant of sale of property Note on language: Here at Second Nature, we prefer the term “resident” rather than “tenant,” as that emphasizes the human element over the transactional. But because legacy property management systems and documentation often make exclusive reference to “tenants,” we’ll favor that term in today’s post. What is a Notice of Sale of Property Letter? A notice of sale of property letter is a formal type of communication that informs a tenant that their rental property is being sold. It outlines the upcoming changes that will occur, reassures tenants about their rights, and details how the sale will affect their tenancy. You might wonder if selling a rental property is even possible with tenants in place. Yes, it is. However, the process requires careful consideration of the lease terms and local laws. If the tenant is on a fixed-term lease, they often have the right to remain until the lease expires. If the lease is month-to-month, the new owner may have more flexibility. But in all cases, understanding and following legal guidelines is crucial as they may vary based on your location. Why You May Want to Sell a Rental Property Property owners might have a variety of reasons why they’re planning on selling the rental property. We’ll break down some of the most common scenarios below: Potential for significant financial return: The property has appreciated significantly recently, and selling now could provide a substantial profit for the owner, and they want to capitalize on that as soon as possible. Eliminates the property management responsibilities: Managing the property has become too time-consuming or challenging, so selling is the best option to free up the owner’s time. Freeing up capital for other investments: They’re looking to reinvest in a different type of real estate, another location, or explore other markets entirely. Change of priorities due to finances: Financial needs, such as funding their retirement or other investments, are driving the decision. While selling a rental property has plenty of advantages, it also has its drawbacks. Here is a look at some disadvantages of selling a rental property: Loss of steady income: Monthly rent means money coming in at the same time every month. Removing that means another means of income needs to be secured. Potential legal challenges: There are many complex laws and regulations to consider, as well as logistics, so if not handled properly - this could lead to major issues down the line, including legal action from the tenant. Reputation: If not handled smoothly and above board, this can cause disruptions for tenants, which could lead to potential damage to a property manager or the property management company’s reputation. Rights of Tenants When the Property Owner Sells the Property Tenants have rights that must be respected when a property is sold. Knowing these rights and planning accordingly can help you avoid legal disputes. Please note that this guide does not constitute official legal advice, and it’s crucial to consult local laws or legal counsel for specific details. Some common laws and regulations you should be aware of include: Local laws and lease terms: Depending on your state or city, there may be detailed regulations about how to handle a property sale. For instance, some areas require you to honor the current lease terms, even with a new owner. In certain states, tenants with month-to-month leases might need to be given a specific amount of notice before being asked to move out. Tenants may not have to move: In some jurisdictions, tenant rights specify that they have the right to stay in the property, even after it’s sold. For instance, under California law, “tenants who have a rental agreement have the right to remain through the end of the rental agreement under the same terms and conditions. The new owner may be able to end a periodic tenancy (for example, a month-to-month tenancy), but only if allowed by law and after giving the tenant the required advance notice.” In other words, a buyer could inherit the lease, and this is especially true for tenants with long-term leases. Some local laws also require that tenants be allowed to stay until the end of their lease term. Always verify this with a legal expert. Utilities and maintenance: As the owner, you must continue providing a habitable property by providing utilities like water and electricity until the tenant moves out. Shutting off utilities during the sale process is illegal, and under criminal law, owners could be charged if they turn these off. For instance, New York Real Property Law § 235 provides protections for tenants, including prohibiting landlords from willfully interrupting utilities – and violations can be considered criminal acts under New York Penal Law. Additionally, if you plan to conduct maintenance or repairs, you need to notify the tenant as required by local laws. Property showings: Although giving notice for property showings isn’t always legally required, it’s good practice to inform tenants well in advance. Most state laws require you to provide reasonable notice before entering the property, usually 24 to 48 hours, though this can vary. Make sure you refer to your state’s tenant laws before scheduling any showings. As a matter of courtesy, prospective buyers should be accompanied by licensed real estate professionals, but in the event that this is not possible, it makes sense to keep open communication channels with the tenant and to maintain high standards for prospective buyers. Security deposits: If the tenant moves out before the sale, their security deposit must be handled appropriately. The deposit should be transferred to the new owner, who will hold it until the tenant vacates the property. Be sure to review your state’s laws to avoid any disputes over this process. As a point of accounting interest, note that on balance sheets, a refundable security deposit appears as a liability – the tenant security deposit belongs to the tenant and must be transferred to the new owner to be held until the tenant moves out. Lease terms: If the property is sold while the tenant is still living there, in most cases the new owner takes over the existing lease terms. However, this can vary based on state laws and the specifics of the lease agreement. For instance, under Florida law, new owners can provide a 90-day written notice of lease termination if they intend to occupy the property as a primary residence. What Should the Sale of Property Letter Include? When notifying your tenant of a property sale, the letter should cover essential points. Luckily, we’ve provided a breakdown of what should be included. Basic information Start with your name (or the property management company’s name), the date, the tenant’s name, and the property address. Include your contact information for any questions the tenant might have. Details about the sale Inform the tenant that the property is being sold. Be transparent about the process, including whether the lease and deposit will transfer to the new owner. Let them know that the property will go on the market, and they may need to cooperate with showings. Showing information Mention how much notice you’ll provide before a property showing. If state laws require specific notice periods (such as at least a one-day notice), cite them to reassure the tenant that their rights are being respected. Clarify that any showings will be conducted by licensed real estate professionals, and be considerate of the tenant’s schedule. Responsibilities before the sale If the tenant has any responsibilities, such as keeping the property tidy for showings, outline them in this section. You may want to consider offering a cleaning service to make it easy for the tenant to keep the property in great condition. In all cases, be polite and professional, and make sure the tenant understands what is expected of them. Incentives (if applicable) If you’re offering any incentives, such as paying for a hotel stay during showings, assisting with moving expenses, or providing a rent discount, mention them here. While not mandatory, these gestures can ease the transition for your tenant and foster goodwill. Relocation support If you manage other properties, you may wish to let the tenant know of any available openings, but this is completely optional and just a common courtesy you can provide to help ease the transition. Thank you section Close the letter by thanking the tenant for their cooperation during this process. Acknowledge the inconvenience this may cause and express your appreciation for their help in making the process as smooth as possible. Letter to Notify Tenant of Sale of Property Template Here’s a sample notice letter template you can use to inform your tenant of the sale, and customize to fit your needs: [Your Name/Property Management Company] [Date] [Tenant’s Name] [Property Address] Dear [Tenant’s Name], I hope this letter finds you well. I am writing to inform you that the property you are currently renting at [Property Address] is being put up for sale. This means there will be some changes in the near future, but I want to assure you that your rights as a tenant will be respected throughout this process. Your current lease will be transferred to the new owner, and all terms will remain in effect. You will be notified in advance of any showings, and we will work to make the process as smooth as possible for you. If you have any questions or concerns, please don’t hesitate to contact me directly at [Your Contact Information]. Thank you for your cooperation during this time. We appreciate your help in keeping the property presentable for potential buyers and making this transition as seamless as possible. Sincerely, [Your Name] Learn more: How to Write a Notice to Vacate Letter to Tenants [with free template]) Final Thoughts Selling a rental property involves careful planning, especially when tenants are involved. A well-crafted letter can help ease the transition and ensure a smooth process for everyone. Remember to stay informed about your local laws and consult legal experts when necessary. If you're looking for ways to enhance the resident experience during this transition, consider improving tenant satisfaction with services like the Resident Benefits Package. Learn more about these packages from Second Nature today.

September 19, 2024

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PMC Spotlight: Chambers Theory

Chambers Theory is a world-renowned property management team with clients in more than 30 countries worldwide. They specialize in serving the U.S. military, State Department, and Foreign Services families. Their motto “Real Estate With Intelligence” is more than just a saying. It’s on full display through the introductory videos for landlords and residents on their website in seven languages (Spanish, Portuguese, Italian, Vietnamese, French, Croatian, and English) - all spoken fluently by their own property management (PM) team. Since its founding in 2018, Chambers Theory has been achieving extraordinary performance benchmarks. They’ve led the marketplace in delivering the “Golden Triangle of Success” to their clients, which means the lowest vacancy, the highest average rents, and the highest quality of tenants of any property management firm in its same service area. They’ve also donated over $100,000 to local charities and community organizations, while also leading the way in promoting sustainability practices in real estate and property management services. Their outstanding team attributes their success to their ability to develop and utilize their emotional intelligence skills to capacity to care with all their interactions with both landlords and residents. That’s why they fully endorse the Resident Benefits Package at Second Nature! Find out more about what a Resident Benefits Package is, its benefits, and how it can help create a Triple Win for you, as well as your residents and investors. Related: The State of Resident Experience Report

July 18, 2024

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Investor Experience Platform™️ IXP™️

An Investor Experience Platform™️ (IXP) in property management is a suite of products, services, and benefits offered by property management companies to property investors. Just like a resident benefits package is a way to drive value for residents, investors, and property managers, the IBP™️ is an innovative approach to property management that focuses on driving value for an investor's assets and turning that value into profit for the property management company. In this article, we’ll dig into the different features that an Investor Experience Platform™️ can include, and how those benefit not just investors, but property managers and residents, too. What Is an Investor Experience Platform™️ (IXP)? As stated above, an Investor Experience Platform™️ (IXP™️) is a comprehensive suite of services that offer property investors higher quality property management, stability, and profit. An IBP™️ typically includes concierge-level services beyond basic property management – such as property insurance policies, eviction guarantees, rent guarantees, maintenance plans, asset performance reports, etc. These services are aimed at maximizing the investor’s assets, stability and convenience, profitability, and peace of mind in managing their properties. They're commonly managed through an investor experience platform to securely manage and monitor the performance of these assets online, which we'll discuss later. The first step to outlining an IBP™️ is to define what your basic management fee means and covers. If the answer is, it’s collecting rent, handling maintenance, and general communication – does that include maintenance coordination or is that a separate fee? Does it include asset reporting or is that an additional service? In your management agreement, define what the management fee is, what it covers, and how much it is. An IBP™️ can be an effective tool for articulating the new and differentiated things that an investor wouldn’t be able to do on their own and that you are offering beyond basic property management. Articulate your unique and differentiated services (IBP™️) and use that as a tool for positioning and charging for what it’s worth. What’s Included in An Investor Experience Platform™️? An Investor Experience Platform™️ should include a range of solutions to help deliver consistency, insight, and asset protection to a property owner’s portfolio. After all, professional property managers don’t have to be functional managers of a home – they can be strategic partners in the management of financial assets. You might hear services similar to the IBP™️ called an “owner benefit package,” but at Second Nature, we believe that the “investor” term is useful in encouraging a longer-term mindset, and emphasizes the economic value professional property management can bring. According to Eric Wetherington, VP of Strategic Initiatives at PURE Property Management: “As property managers, we need to think more like asset managers. This client made an investment, and we should be guiding that client through managing that investment, not just collecting rent.” To build and manage a winning IBP™️, property managers need an Investor Experience Platform that unlocks scalable product and service customization, digitized onboarding, accounting policy automation, and more. In addition, Investor Experience Platforms provide transparency and convenience for your investors. Here are some of the most valuable services that property managers can offer through an innovative Investor Experience Platform™️. Property insurance program Similar to offering a renters insurance program through an RBP in the lease agreement, property management companies can offer an insurance plan to investors to cut costs and ensure the safety of their assets. Most management agreements will include the requirement that the investor carries insurance on the property and that the property manager is additionally insured. But what if you as the property manager could help manage that for the investor – at scale? Property Insurance for investors should have dynamic pricing based on individual investors’s property portfolio and needs. The benefit beyond flexibility is the savings they’ll see on their premiums while also getting insurance that’s tailored to the needs of their specific property class. At Second Nature, we work primarily with single-family rental properties and small multi-family residences. Property Insurance Programs can bring scale that will drive economic value for the investor over what they could get retail on their own. They’d still have the option to go get their own insurance that meets requirements, but they can pay you a small fee to manage it for them. Rent guarantee An IBP™️ can include a number of financial guarantees to protect property investors and drive ancillary revenue for PMCs. A rent guarantee, or rent protection, ensures a consistent rental income to investors by protecting them against resident defaults or non-payment of rent. If a resident fails to pay rent, the property management company covers the unpaid amount and takes necessary steps for eviction or collection, providing financial security and minimizing the risk for property owners. Rent guarantees work for professional property management companies that have enough properties to balance the loss of rent if a resident doesn’t pay. The risk is low and the additional profit from fees for this guarantee can have a very high ROI, while driving satisfaction and stability for the investor. Plus, if you’re using services in an RBP to help incentivize on-time rent payments, you’ll rarely find yourself out in the cold. Eviction protection guarantee An eviction protection guarantee also goes beyond the normal scope of property management services and can be used as a secondary source of revenue. Eviction Protection is a service provided by property management companies to property investors that offers additional security and financial protection in the event of an eviction. Under this guarantee, the property management company assumes the costs associated with the eviction process, including legal fees and court expenses. It helps alleviate the financial burden on property investors and provides peace of mind by ensuring that they are safeguarded against potential losses resulting from resident evictions. The eviction guarantee helps protect property owners from the complexities and potential costs associated with evictions, ensuring a smooth and efficient resolution to tenant-related issues. Pet guarantees & other guarantees A pet guarantee is a service offered by property management companies to property investors that aims to address any potential issues related to allowing pets in rental properties. It typically involves implementing policies and procedures to ensure responsible pet ownership, such as thorough pet screening, pet agreements, and collecting additional pet deposits or fees. The pet guarantee may also include services like pet damage insurance or assistance with pet-related issues during the lease term. It provides property investors with a framework to accommodate residents with pets while minimizing risks and maintaining the condition of the property. For many residents, finding a pet-friendly apartment increases retention and profitability. They’re willing to stay longer and pay more for a pet-friendly place. And–get this–pet damage is less likely to happen than damage from kids! It’s not a huge risk to the asset, but can provide a big benefit in terms of satisfied, longer-term residents. Maintenance plan Home warranties are a four-letter word for property managers. They’re a massive headache to deal with, and yet there’s high demand for them among property investors. Because of that, most property managers charge a fee for home warranties, for each they have to file. Imagine if there was a world where home warranties weren’t needed. Here’s the thing: Professional property managers already have the vendor network and the know-how to coordinate maintenance jobs. What they don’t usually have is a product that’s priced to give the investor the experience they want. Let’s say right now an investor is paying $50 a month for a cheap home warranty. The warranty only covers 40% of issues and it creates all these extra people and friction in the middle. For anything moderately significant that goes wrong with a property, PMCs generally must contact the investor for permission to get work done. It’s all a massive hassle and loses time in maintenance requests that leave residents frustrated. What if there was a product that costs, say, $150 to $200 a month but it actually covered everything? Instead of having sudden expenses and emergencies, this maintenance plan smooths out the experience and makes it more predictable for the investor. For PMs, it means taking the initiative on fixes without waiting for approval. Imagine a world where you didn’t have to get owner approvals for 95% of maintenance issues – because they’re already budgeted for and already paid for. For residents, it means better maintenance, and faster. Another Triple Win! Asset performance reports Another piece focuses on property managers as asset managers. Think about any investment app, like Robinhood, Acorns, etc. You can log in to these apps any time, 24/7, and see how your stock and investments are performing. In most investment classes, you can see in real time how your assets are performing. Why shouldn’t property investors have that as well? An IBP™️ can include exactly that: a dashboard or online portal that shows investors regular reports on how their property is doing. They could get updates on the value of their home over time, the home price appreciation, rent price over time, and project rent growth, typically maintenance costs and how they’re doing against that, and more. Resident Benefits Package Another piece to include in your IBP™️ is to highlight the benefits of your resident benefits package to your investors. Explain how features like a filter delivery program protect their assets and reduce HVAC repair costs. Show how a renters insurance program can ensure coverage and protection. Give numbers on how credit reporting incentivizes on-time rental payments and helps ensure financially stable renters. Explain how a movie-in concierge saves both time, headache, and money. Each of the pillars of an RBP is critical to encouraging better resident behavior, increasing renter retention and lease renewal rates, reducing vacancies, and more – all primary goals for a property investor. A note about Rent Advance Programs There’s been due buzz about “Rent Advance” offerings, though many advise caution when approaching this financial product. It works in some ways like cash advance programs, which can satisfy urgent needs, but not be more valuable for anyone long term. The way it works is PMs offer to send a year of rent upfront to the investor in a big chunk, and collect monthly from the resident. The investor typically pays a 5-10% premium on the advance, which can be their entire expected return. So the question becomes, where do they put that cash to get a better return instead? Another thing to think about is who would actually use this product. Investors who don’t have enough cash on hand? How does that benefit anyone in the long run? What happens when there’s a big maintenance bill later? Does this encourage better decisions and practices by the investor? To date, there’s been pretty low adoption of this program, which is another sign it may not be hugely beneficial to everyone involved. But plenty of innovations start that way, evolve, and find traction. One case where it might be a value generator is if an investor is looking to take a cash advance and put it toward a down payment for another house. That would benefit the property manager as well, promising more business, and the PM could offer a lower rate for getting more properties to make the financing more attractive than hard money loans or other alternatives. The jury is still out here, it’s an interesting one to track. How Can Investors and Property Managers Benefit From an Investor Experience Platform™️? Investors and property managers can benefit from an Investor Experience Platform™️ in several ways. They’re also great for residents in the sense they build more stability and quality into the renting process. Here are just some of the benefits of an IBP™️. Enhanced investor attraction An Investor Experience Platform™️ provides incentives and advantages that can attract more investors. Financial guarantees and protections against the risks associated with evictions or late payments can increase stability, while services like a maintenance plan can ensure premium care of their property assets without increasing their workload. By offering attractive perks, property managers can differentiate their offerings and generate greater investor interest. Increased investor retention Both IBP™️s and RBPs help build loyalty with residents and investors. By fostering a strong relationship and demonstrating ongoing value, property managers can build trust and loyalty among investors, and retain them over the long term. IBP™️s help establish the stability, transparency, and asset growth for a real estate investment that an investor hopes to achieve. Improved property performance An Investor Experience Platform™️ can also contribute to improved property performance. For example, by offering discounted property management fees or access to professional services at reduced rates, property managers can help investors optimize their returns and reduce costs. Additionally, incentives such as rent guarantees or eviction protection can mitigate risk for investors and attract more capital to the property. Streamlined communication and transparency A well-designed Investor Experience Platform™️ facilitates effective communication and promotes transparency between property managers and investors. This can involve regular reporting on financial performance, property updates, and the sharing of relevant market insights. Transparent and consistent communication builds trust and confidence among investors, fostering a positive and long-lasting relationship. Competitive advantage A comprehensive Investor Experience Platform™️ can give property managers a competitive edge in the market. When investors have access to exclusive benefits and advantages, they are more likely to choose a property managed by a company that offers a compelling package – and to recommend it to others. Say hello to increased investment inflow and a stronger market position for your PMC. Should You Make an Investor Experience Platform™️ Opt-in? The first thing most property managers ask us when we’re talking about an RBP or an IBP™️ is: Should I offer this program as part of the base service or as an additional opt-in option? Unlike RBPs, where best practices are more proven and established, different PMs are taking different approaches with their IBP™️s. Some have a required level of service set at a flat price. Others may say they’re fine offering a base level of service without these differentiated products, giving investors the choice to simply pay a baseline management fee and opt out of the IBP™️ premium service. Some may offer a baseline to all investors and then give them the chance to opt in for premium IBP™️ services. There are a lot of ways to do it. With the RBP, we’ve found that including in your base package does not generate nearly as much pushback as people expect – and can be a strong value add overall. Final Thoughts About an Investor Experience Platform™️ The Investor Experience Platform™️ is an innovative way to generate ancillary income and create more value for investors and residents. Similar to Second Nature’s premier Resident Benefits Package, the IBP™️ can deliver high-quality service for investor experience – and help create a triple win for investors, residents, and property management companies. The IBP™️ reinforces the value of a professional property management company for investors and helps differentiate you from the crowd. Stay tuned to learn more about the latest in the IBP™️ space, or learn more about how a resident benefits package can launch a whole new level of value for your PMC.

July 17, 2024

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How to Create Your Tenant Move-in Checklist, Tips + Free Template

We get a lot of questions here at Second Nature about the ideal tenant move-in checklist. After all, whether you're new to the realm of property management or a seasoned expert, one common goal unites us all: creating an excellent resident experience. The move-in process marks the beginning of your resident’s journey, and it's an opportunity to make a great first impression. A well-crafted resident move-in checklist can make this process smooth, efficient, and stress-free for all parties involved. In this article, we're talking to a leader in the single-family rental property management space to help us delve into the essentials of a resident move-in checklist, its benefits, and how it can enhance the overall resident move-in experience. Let's dive in and discover how a simple checklist can streamline your move-ins. Interested in reading more about resident experience management? Read our State of Resident Experience Report. Meet the Expert: Janet Sprissler, Broker/Owner, Rent 805 Janet Sprissler has over 20 years of experience in property management and a philosophy of working with residents to bring them value and help communities thrive while providing investors with a positive net operating income. She started her career in Los Angeles with 24 units and grew to a multi-family fixer for over 400-unit buildings throughout Ventura, Los Angeles, and Orange Counties. Janet left multifamily to consult with single-family residential managers to bring her problem-solving philosophy to life. Starting Rent 805 has been a lifelong dream of hers to bring investments, housing, and a positive impact in the property management community. Janet also received the 2023 Triple Win Property Management Award for Leadership in Resident Experience. Related: Notice to Vacate Tenant Free Template What is a Tenant Move-In Checklist? A tenant move-in checklist is a detailed document that records the condition of a rental property at the time a resident moves in, serving as an essential tool to prevent potential disputes over property damage during the lease period. Some consider this a landlord-tenant agreement but can be between property managers and residents, as well. This checklist is a lifeline for both property managers and new residents. From the state of the kitchen appliances to the condition of the flooring, this checklist serves as a comprehensive record of the property's state. Other names for the checklist could include: Think of it as a snapshot in time, providing a clear reference point for both parties. It's not just a piece of paper; it's a roadmap to a smooth tenancy for everyone involved. Now, that's a win-win! Note on Language: At Second Nature, we like to say “resident” rather than “tenant,” but will use the terms interchangeably since many property managers have official terminology around these checklists. Related: How to Write a Tenant Move-Out Letter Benefits of Using a Tenant Move-In Checklist Using a well-crafted checklist has far-reaching benefits for property owners, property managers, and property residents. We’re breaking down the benefits based on each of these perspectives. Benefits for property owners Protection of property: A move-in checklist includes a detailed property inspection, protecting owners from damage disputes at the end of a lease. Compliance with local laws: Some jurisdictions require move-in checklists for legal protection. Maintenance tracking: Early identification of maintenance issues can help property owners address them proactively. Benefits for property Managers Streamlined process: A move-in checklist provides a clear process, helping property managers to stay organized and ensure all essential tasks are completed. Improved communication: A checklist sets clear expectations for the move-in process, promoting transparency and minimizing misunderstandings with residents for the lease agreement. Property protection: By signing off on a detailed checklist, property managers ensure their good work is documented and any issues can be clearly identified as resident responsibility. This is critical when it comes to the security deposit if there is damage. Increased efficiency: Using a checklist can speed up the move-in process, maintenance before move-in, etc., saving property managers valuable time. Benefits for residents Clarity and transparency: A checklist provides residents with clear expectations of what the move-in process involves and their responsibilities. You will have a document of pre-existing damage and know what repairs are needed, plus what’s just normal wear and tear. Peace of mind: A detailed property inspection at move-in provides a record of the property's condition, protecting residents from unjust damage claims. It also helps them ensure any open issues are repaired. Smooth transition: A well-organized move-in process can ease the stress of moving, enhancing the resident’s initial experience and ensuring they move into a space that’s ready for safe living. How Should a Property Management Company Prepare for Tenant Move-In? Making sure the property is ready for the new tenant before they move in, and that the former tenant (if applicable) has a seamless transition out of the property - follow these guidelines to ensure a smooth process and happy tenants. Redirect mail: Before your last communication with the former tenant, PMs should notify them they can submit a change of address via USPS so all their mail gets forwarded to their new address with ease. Clean the property: The previous tenant will typically clean up the space to some degree before they move out, and PMs will do a rental inspection to review the condition of the rental property. After this process, we recommend scheduling professional cleaning services to spruce up the property and make it move-in ready for new tenants. Confirm repairs are completed: Any repairs or maintenance tasks identified in the move-out inspection should be completed before the new tenant moves in. Check for safety hazards: Conduct a thorough inspection and fix any potential safety issues, such as exposed wires, tripping hazards, or loose handrails. Copy the keys: The former tenant will leave you with a copy of the house keys. Make sure they’re not damaged and test them to make sure they still work properly before handing them over to the new tenant. If you happen to change the locks, be sure to set time aside to create an extra set (or two, just in case the tenant loses one). Share appliance instructions: While some of this information would be included in a welcome packet for tenants, it’s helpful to share instructions or operating manuals for some of the appliances to help them understand how to properly care and use them during their tenancy. Check landscaping: Make sure the grounds (such as lawns, gardens, and commons) are presentable and well-maintained. This should include reviewing the exterior elements of the property such as the driveway, light fixtures, fence, roof, and gutters. Reach out to your landscaping and maintenance vendors to schedule regular upkeep, unless this is the tenant’s responsibility such as mowing the grass. Provide utilities information: Share information about the utilities such as electricity, water, gas, heating/cooking systems, and internet. Make sure they know how to transfer utility bills to their name, as well. You can also include information about a move-in concierge in a Resident Benefits Package through Second Nature. What Should a Property Management Company Provide to the Tenants During the Move-In Process? During the move-in process, property management companies should provide tenants with the following: Lease agreement PMs should provide tenants with a copy of the signed lease agreement, which details the overall terms and conditions of the lease. We recommend providing a hard copy, in addition to an electronic one to ensure peace of mind both for the property management company and the tenant. Related: Lease Management Process Safety records Safety records, including smoke and carbon monoxide alarm certifications and any other safety inspections, should be readily available to ease the tenant’s mind. Having this documentation helps make sure the property is up to safety code, as well for the PM. Smoke alarm and carbon monoxide detectors In addition to PMs sharing documentation showing that smoke alarms and carbon monoxide detectors are properly installed and functioning, they should also discuss when and how often they may need to be replaced. This is essential to tenant safety and can reduce the risk of fire and carbon monoxide poisoning in the rental property. Inventory of the property A detailed inventory of the property, including the condition of furniture, appliances, and other items is helpful for tenants to be aware of. This is the bulk of the checklist, and includes an evaluation of each room's condition, including walls, flooring, windows, countertops, faucets, doors, light fixtures, and any furniture or appliances. More details can be included such as the condition of the paint, if there are any visible carpet stains, and the functionality of the appliances. PMs can take the extra step by providing clear photos of each room to show existing damages so there’s a visual record and to clarify any potential disputes. Property managers should perform the inventory check with the tenant, and allow them to review this checklist so they can agree on the condition of each item before signing off on it. By dating and signing the document, this confirms their agreement on the property’s initial condition. What Should a Property Management Company Do on the Day the Tenant Moves In? Property managers can start a positive relationship with the tenant by providing a warm welcome on their move-in day and clear communication about the property. Here are some guidelines on what to walk through that first day: Demonstrate equipment Tenants are typically aware of how equipment in the property works, such as locks, dishwashers, and washing machines. PMs should check with the tenant if they’d like an overview of anything, to make sure they understand how to use it. Explain safety equipment Part of the walkthrough should include an overview of where the safety equipment is so they can be prepared if there’s ever an emergency. This should include an explanation of how to use relevant equipment such as fire extinguishers and blankets, locks, and any security systems. Provide emergency contact numbers Tenants should have a list of local emergency contact numbers, as well as main points of contact at the property management company. This should include a written explanation of how to deal with different emergency situations on the property, such as losing power, issues with the HVAC system, or an urgent repair. Answer questions Once the walkthrough is complete, tenants should have the opportunity to ask any immediate questions they have about the property or their tenancy. If they have questions later, they can always reach out to the property manager later. Hand over the keys Once the property manager has walked through everything and answered all the tenant’s questions, the last step is handing over the keys and making sure they have access to any additional common areas. Are Property Managers Required to Use a Tenant Move-In Checklist? Sometimes, new tenants must be provided with a written statement on the condition of the unit at move-in time, including a comprehensive list of existing damage. This varies by state, though. For instance, this applies to all new tenants in Arizona, Connecticut, Hawaii, Kansas, Maryland, Nevada, North Dakota, and Virginia. Yet, in other states, such as Georgia, Kentucky, Massachusetts, Michigan, Montana, Washington, and Wisconsin - this depends on whether a security deposit is being collected. This process is designed to ensure transparency and fairness, promote better communication, and reduce potential conflicts between the tenant and property management company. For detailed information on specific state requirements, we recommend consulting local laws or legal resources, particularly since cities and counties may pass local ordinances that affect tenant rights and responsibilities. How to Create a Tenant Move-In Checklist As hinted earlier, a tenant move-in checklist involves several comprehensive sections to make sure it fully captures the property’s condition. (Don’t worry, we’ll provide a template you can use!) Some of these will include the following section: General information: This covers the basics like the property address, the names of the tenants, and the date of the move-in inspection. Rooms: This includes noting the condition of each space such as the bedroom(s), bathroom(s), kitchen, living room, and dining area. It typically includes an overview of the conditions of the doors, floors, walls, and windows in each space. Appliances: This describes the state of the appliances and fixtures in the property such as microwaves, dishwashers, fridges, washing machines, and outlets. Utilities: This includes a review of systems such as plumbing, electrical, HVAC, and the to make sure the electrical panel is property labeled and connected. Safety: In this critical step, a property manager does a walkthrough of safety equipment such as smoke alarms, carbon monoxide detectors, and fire extinguishers. This includes making sure they’re visible and functioning properly. Exterior: An overview of the exterior features of the property, such as the front walkway, front porch, rear deck, yard, driveway, security lighting, and any outdoor structures. What To Do After Completing a Move-In Checklist Once the move-in checklist has been properly filled out and completed, the property manager can wrap up the final steps of the process. The first step is to go over the details of the checklist with the tenant to make sure they understand it and agree with the property manager’s assessment on the conditions of everything in and around the property. If they disagree about any of the items, the property manager should discuss it with them immediately so they’re both in agreement before they sign off on it. Once the tenant has approved this, make sure they sign and date the checklist as well as the property manager. A copy of the signed checklist should be given to the tenant once they’ve signed it, and then the property manager should retain the original and copy for their own records. If the tenant has any repair requests, they should be able to share them by reaching out to the property manager directly or submitting a ticket through the property management portal. Tip to Optimize the Move-In Experience With a Checklist A checklist is the foundation of a wonderful move-in experience. But it’s just the starting point. How does a property management company set itself apart from others in the move-in experience? Here’s where we went to Janet Sprissler and others in our Triple Win Property Managers community for input. Use the right tools It’s easy to forget a step if you don’t have tools that help automate your process and keep your whole team on the same page. The most important thing? “You don’t forget a step!” Sprissler says. “Without a checklist, you’re pretty much setting yourself up to fail,” she continues. “You will drop things, things will be missed, they’ll move in, and there’s going to be a problem. When you set the tone that ‘this is going to be a hot mess,’ you’re setting yourself up to have disgruntled residents, and disgruntled residents never take care of the property well.” Sprissler especially recommends Monday.com for tracking the checklist and process with your internal team and tools like Tenant Turner to help on the resident side. They use zInspector to ensure they are on top of property inspections. “I’m not big on a bunch of papers around,” she says. “I want to see it all automated, I want any of my team members to be able to dive into Monday.com and see what’s missing or needed right away. That system runs so much, I’m a huge fan of it.” Treat all residents with equal care Sprissler says focusing on making residents feel that “WOW!” is critical to their longevity and care for the property. At her company, they focus on seamless processes, transparent communication, and even gifts! The key is that every resident gets that same treatment. “New residents MUST have a move-in gift,” Sprissler says. “They must all get the procedures we’ve set ahead of time. They must receive their birthday gift, they must receive access to our First of the Month Club. We do a move-in concierge through Second Nature – they must have that touch point. We don’t ever say, ‘Hey, this is going to happen,’ and then it doesn’t happen.” Design the ideal move-in process We asked Sprissler how they create an ideal resident experience throughout the move-in process, and this was her top recommendation. “We make it seamless. SEAM. LESS,” she said for emphasis! “On the move-in side, our new residents go through Tenant Turner to get onto the property with an access code. Move in and move out is on Tenant Turner. We make it very simple for them to get access to the property. We don’t play around with it.” “At every stage of the process, prospective and new residents have had conversations with us so that they’re set up, and they know what’s going to happen next.” For Sprissler, it’s about thoughtful touches that give residents a sense of a VIP experience. “For example, people get hungry!” Sprissler says. “We have pizzas delivered on a moving day. One of our move-in questions is ‘What’s your favorite pizza?’” Be willing to go above and beyond Added touches – like the pizza on move-in day – go a long way to establishing the best resident experience and behavior. “When tenants have those touches, it makes life better. It just does,” Sprissler says. They provide birthday gifts and move-in gifts and will add items for pets or children customized to those residents. “People often say, ‘How are you recouping that?’” Sprissler says. “I’m recouping that by having great units when I walk through the door. You cannot pay someone to take care of a unit. But if they feel the worth of themselves and how you feel about them, they take great care of the unit.” Provide a move-in concierge Second Nature includes a move-in concierge as part of the Resident Benefit Program. Sprissler says this is one of the best parts of a seamless move-in. “We use a move-in concierge through Second Nature,” Sprissler says. “People really like it when they’re being reached out to, and all of that is handled. Moving is one of the top five stressors people experience in life. You have to realize as a property manager that you have to take some of that pressure off them. Take it off their plate! Are you making a better experience by piling stuff up on them?” “When people come into my office and say this is the best experience I’ve ever had, I know we’ve done our job,” Sprissler says. Provide a renter’s insurance program Making sure that residents have insurance coverage from day one is key. You never know when something could happen, and protecting residents is the foundation of a good experience. Second Nature’s RBP includes a renter’s insurance program that has 100% compliance across its use. Sprissler is one of the people who use this program, and she says it’s critical to have for her residents. Set clear expectations and incorporate incentive fees Sprissler recommends requesting a tenant ledger so you have the clearest information about the resident before move-in. “You can see if they’ve been charged for maintenance requests, you can see what day they pay – it really is a black and white of how they treated that previous unit,” she says. And then, of course, that clarity should be reciprocated. Sprissler emphasizes transparency upfront and excellent follow-through. Be clear, but also show that you are willing to listen. “Say what you mean and mean what you say,” Sprissler says. “I have Rent 805 rules and regulations, and any delinquency is heavily fined. Those are behavioral fees. For example, my late fee is very high, but then it’s also part of my resident benefit package to forgo that one time during the life of the tenant being in the unit. It just sets expectations.” Ultimately? “If you use good software that does a good job of screening, these questions are all resolved for you.” Free Tenant Move-In Checklist Template To help streamline the move-in process and ensure clarity for both property managers and tenants, we’ve provided a free tenant move-in checklist template. This comprehensive checklist covers all essential areas of the property and helps document its condition at the time of move-in. Property managers can feel free to customize the checklist to their specific needs. We also recommend getting legal guidance to make sure you’re covering all your bases. Tenant Move-In Checklist Property Address: Tenant Name(s): Move-In Date: General Information Property Address: Tenant Name(s): Move-In Date: Living Room Walls: Floors: Windows: Doors: Kitchen Walls: Floors: Windows: Doors: Appliances: Refrigerator: Stove/Oven: Dishwasher: Microwave: Bedrooms Walls: Floors: Windows: Doors: Closets: Bathrooms Walls: Floors: Windows: Doors: Fixtures: Sink: Toilet: Shower/Bathtub: Utilities and Systems Plumbing: Electrical: HVAC: Safety Equipment Smoke Detectors: Fire Extinguishers: Carbon Monoxide Detectors: Exterior Yard: Driveway: Outdoor Structures: Signatures Tenant Signature: Property Manager Signature: Date: Final Thoughts Remember, a move-in checklist is not just a document; it's a tool to enhance communication, establish expectations, and create a positive resident experience. Our top recommendation for ensuring a world-class resident experience is to build a resident benefits program. Second Nature has pioneered the only fully managed Resident Benefits Package for single-family property managers. Learn more about resident experience management in our State of Resident Experience Report, or explore the benefits of a Resident Benefits Package.

July 15, 2024

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Property Management Insurance Coverage Guide

A study by Orchid on property manager insurance found that while 80-90% of property managers require residents to carry insurance, only about 41% of residents actually have or retain that required coverage. Kind of crazy, right? Especially when you consider that that gap represents a huge exposure to risk for both the property manager and their investor. Insurance for property management is a must – it protects not just you but your investor’s assets and your resident’s safety. At Second Nature, insurance is so important to us that we wrap an insurance product into our resident benefits package. So, today, we’re looking at property manager insurance requirements and why it’s so important to get into the nitty-gritty details. ‍ Key Learning Objectives: What is property management insurance? Why do property managers need insurance (risks and liabilities)? What types of insurance are important for property management companies? Should property managers require residents to have insurance? How do you choose the best insurance for property managers? How much does property manager insurance cost? Examples of property management insurance coverage claims What our tenant liability insurance product can cover What is Property Management Insurance? Property management business insurance is protection for property managers against the risk of damages or claims against you from residents or clients. In other words, property management business insurance ensures that you, as the professional property manager, are covered in the case of liability claims, legal proceedings, or losses from perils like fire, vandalism, or burglary. Property management business insurance can also include tenant liability insurance, or your leases may require that renters are insured in some form. We’ll talk more about tenant liability insurance below. Why Property Managers Need Liability Insurance Coverage Property managers are responsible for a lot. Managing people’s homes means that property managers take on considerable liability risks. Claims of injury or property damage can lead to serious financial losses if you aren’t protected. Property management liability insurance coverage reduces that risk exposure and keeps you from paying out the cost of wrongful eviction claims, injuries, property damage, etc. In a perfect world, there would be zero property management requirements. We talk a lot about the Triple Win and how property managers should aim to build services and products that delight residents, protect investors, and retain talent on their teams. But even with the best service, everyone inevitably hits some speed bumps. Maybe a resident isn’t happy with an eviction notice, a maintenance item slipped through the cracks, or a property simply got unavoidable damage. Property management company insurance ensures you’re not liable for the costs of these inevitable parts of life. What are the Types of Insurance That a Property Management Company Needs? At Second Nature, we’ve worked with professional property managers across the country and seen several different approaches to insurance. But no matter where you manage property, there are some standard types of insurance that property managers should buy or require. Here are some of the basics. General liability insurance for property managers General liability insurance for property managers covers physical risks for which you might become financially liable. It will typically help cover repairs, replacements, legal fees, and medical bills. You can get it for residential or commercial property. Property manager liability insurance can include coverage for claims like: Bodily injury: If a resident decides to sue for an injury they sustained on the property. Medical payments: If someone gets hurt on your property and holds the property manager responsible for the injury, the PM could be liable for covering their medical costs. Property damage: If you or one of your employees caused damage to the property. Reputational harm: This helps cover you financially if someone sues you for libel, slander, wrongful eviction, privacy violations, etc. Advertising injury or copyright infringement: This typically refers to coverage if you ever faced a lawsuit for copyright infringement in your marketing. Professional liability insurance for property managers Known as both professional liability insurance or E&O insurance, this type of property management insurance protects Property Management companies (PMCs) from claims about mistakes in their professional services. Errors and omissions insurance willy typically cover legal fees if there was a mistake in a contract or if there were any – well – damaging errors or omissions in any communication. It may also cover errors in service, omissions in information, negligence, or even inaccurate advice. Like with any insurance, ideally, you’ll never need this! However, it is best to protect your company from such financial risks if any of your clients decide to make a case against you. Cyber liability insurance for property managers Cyber liability insurance helps protect you from financial losses due to cyberattacks or data breaches. Cybersecurity is a top focus of business leaders for 2024 and should also be a strong consideration for property management leaders. PMCs handle sensitive personal data from both residents and clients. Should your company ever experience a data breach, fraud, or other cybersecurity threats, this insurance will help recoup your losses. Worker’s compensation insurance for property managers Every business with employees – whether it’s one or many – needs worker’s compensation insurance. Worker’s comp covers the costs of employee injury while at work. It also can protect business owners from employee injury lawsuits. Even sole proprietors may use worker’s comp insurance to cover work injury costs that health insurance might not cover. In most states, businesses without worker’s compensation insurance will be fined. Be sure to know your state’s laws. Deposits and damage coverage insurance for property managers Deposits and damage coverage is a payment the resident submits up-front to be given back at the end of a lease, assuming they haven’t damaged the property. There’s a lot of innovation in this space, with new products and services providing security deposit alternatives. Many of these are pure insurance, covering damages for a monthly fee. Vacation rentals owners’ insurance Vacation rental owners’ insurance covers the investor for any vacation rental property they own. This coverage protects against losses in case of robbery, fire, vandalization, or other damages, whether the building is vacant or occupied. While property owners should have their own policy, sometimes property managers can extend coverage for some losses as part of their license. Tenant discrimination insurance for property managers While we don’t know any property managers in our network who would intentionally discriminate against residents, it’s smart to have this type of insurance as well. Discrimination based on sex, race, religion, ethnicity, age, sexual orientation, disability, etc., is illegal. But that doesn’t mean you’re automatically protected from a discrimination suit. This type of insurance can protect you in case a disgruntled former resident attempts to sue, no matter how baseless the allegations are. Tenant discrimination claims can lead to serious financial risk and expensive lawsuits. Coverage for such claims are generally excluded from General Liability policies. Be sure to review your existing policy to determine your exposure and add additional coverage as needed. ‍Renter’s insurance Renter’s insurance – or H04 insurance – is essentially a financial safety net for residents and their belongings. Renter’s insurance should include three distinct types of coverage: Property Damage/Liability Insurance: Plans typically provide around $100K in coverage, though different properties may require different coverage (pools, for example, increase coverage) Contents and Belongings Coverage: For any damaged or stolen belongings they would like covered. Usually, this will be around $10K of coverage, but residents can opt for higher coverage. Loss of Use/Additional Living Expenses: For any costs a resident incurs for living expenses in the vent the residence is uninhabitable. We recommend residents seek contents and belongings coverage that provides replacement cost value (RCV) rather than actual cash value (ACV), as ACV may not offer sufficient coverage. For example, if you have a 10-year-old laptop that gets damaged, ACV would only cover the value of your 10-year-old laptop at the time of the damage. RCV would cover the value of replacing it with a new laptop of a similar kind and quality. Should Property Managers Require Renter’s Insurance? Do property managers need to require their residents to carry renter’s insurance, or in the least, tenant liability insurance? Most professional PMs would say absolutely yes. Remember, 80-90% say they require their residents to carry insurance coverage. So, why do only 41% of residents retain that coverage? Often it’s simply a matter of insurance lapsing without anyone noticing. Or a resident might submit paperwork that’s out of date or decide to end their policy without thinking they need to let you know. Whatever the reason, it’s important to have a backup plan. If a resident’s insurance lapses, you could be liable for damage during that time. At Second Nature, we provide tenant liability insurance as part of our Resident Benefits Package (RBP). This feature allows property managers to offer price-competitive insurance coverage that applies to all residents with one basic group rate. We’ve seen 100% insurance compliance among property managers using our RBP. How to Choose the Best Insurance for Property Managers As you choose your property managers' insurance plan, it’s important to consider the risks you want covered and any liabilities you might face. Here are a few best practices for selecting a property management business insurance plan. 1. Consider your niche and your needs. What is your property management business niche? What kind of properties do you manage? What is their value? What risks or liabilities are you most concerned about? Do you have employees, or are you a sole proprietor? It’s also important to consider your goals and how your business services and objectives might change over the coming year. If you need a new type of insurance soon, include that consideration in your search. 2. Establish your budget and review prices Get a good idea of what’s on the market and how much it costs. Consider the level of coverage you need vs. what you feel you can afford. Make sure you’re building those insurance fees and deductibles into your pricing structure. 3. Compare vendor specialties Some insurance companies focus on offering several types of insurance, while others dial down into a specialty. Often, just like with property management, going with the specialist vendor will ensure better coverage and service, however, it may also cost more. 4. Use your network This is where your network really becomes useful. The SFR property management community is an open, generous group of folks. Most will be more than willing to share their insurance experiences, what has worked, what hasn’t, and their favorite vendors. Ask around within your network for advice. Also, make sure to read reviews of any potential insurance companies and see if they have property management clients. 5. Always talk to your attorney Of course, this is probably the most important practice. Never make any insurance decisions without discussing them with your attorney! They will be best able to help you navigate legal requirements, your greatest risks and liabilities, and what type of coverage makes the most sense for your PMC. Explore our resident benefits package, which includes renters insurance. How Much Does Property Management Insurance Cost? The cost of property management insurance will fluctuate based on what you decide you need. Your level of risk also affects the cost of insurance. Insureon gives several estimates of standard costs for property management and real estate insurance. The following average prices are based on Insureon’s customers’ policies, subject to change at any time: General Liability insurance costs, on average, about $30/month for a $1 million per-occurrence limit and a $2 million aggregate limit. Errors and Omissions insurance can cost, on average, around $55/month with a $1 million per-occurrence limit and a $1 million aggregate limit. Worker’s Compensation insurance can cost, on average, about $50/month or $600-$620/year. Cyber Liability insurance can cost, on average, a median of $140/month, depending on the sensitivity of the information. The average prices listed above will vary based on the PMC, properties covered, and the type of coverage and limits requested. Again, property managers should consider which type of coverage they need and then build those costs into their pricing structure. Examples of Property Management Insurance Coverage Claims Let’s look at a few examples of common property manager insurance coverage claims. How does insurance help when you face a crisis like damage, injury, or a lawsuit? Here are a few examples of common types of claims. Wrongful eviction That’s one no property manager wants to see! But it takes just one disgruntled former resident to bring a wrongful eviction suit against a PMC – even if the claim is unreasonable. An example of this could be a resident approved with excellent references, but after move-in, begins disturbing the peace in the neighborhood. Maybe they get noise complaints late into the night or transgress community guidelines. Another example would be a resident who is not making rent payments on time. In those cases, the property manager would then deliver formal notice of the problem and take the proper steps to legally evict the resident if necessary and allowed by law. It’s still possible that the resident could sue for wrongful eviction. However, as long as you document your process clearly with your attorney, and follow all legal requirements, your insurance should cover the costs that may result from the lawsuit if such coverage is included within your policy. Loss of rental income Here’s a good example of coverage for loss of rental income: Our built-in tenant liability insurance plan provides coverage to a PMC in the event one of their properties is unrentable due to a covered loss caused by a resident. For example, if a property that is covered by our plan is damaged due to a fire caused by the resident and the PMC is unable to rent that property out for a few weeks, they can file a claim under the Loss of Use endorsement and receive up to $1k. Property damage Property damage could be covered differently based on the type of coverage – either by the renter’s insurance, the PMC’s, or the investors’ general liability insurance. So, here’s a real-life example from one of Second Nature’s partners: A resident went out of town, and when he returned after two days, he found that the back sliding door with two glass panels was cracked on one side. It’s tempered glass, so the PM didn’t know if it was from heat, intentional damage, or something else. In this case, if the damage were caused by a covered peril (fire, smoke, water, explosion, collapse, etc.) or resident negligence, the PM’s master insurance obtained through our offering would help cover the cost. An investor’s property insurance should also cover property damage for the same causes. Pet damage or dog bites Pet liability insurance helps cover any damage done by pets to the property – or injury caused by the pet to anyone else. Under our tenant liability insurance benefit, pet damages and dog bites are covered up to $25k. We have one of the only insurance policies that cover any dog breed as long as the property manager approves the dog. Animal liability covers the cost of any suits filed and medical expenses up to the policy’s limit. How Second Nature Helps with Your Resident’s Insurance Coverage At Second Nature, we know how valuable your investors’ assets are – and how much risk you take on as a property manager. While insurance can sometimes feel like a zero-sum game, we aim to make every opportunity a win for everyone involved. That’s where our tenant liability insurance product comes in. We offer PMCs a fully managed tenant liability insurance plan that helps ensure compliance and that you, your investor, and your residents can rest easy knowing you’re covered for damage or harm. With our tenant’s liability insurance, we’ve seen our partner PMCs go from: Only 41% of residents covered → 100% of residents covered Portal administration → Fully managed for you Leasing team tracking certifications → 100% certificate management Higher premiums → lower premiums Implementation and vendor management → 1 RBP, 1 Invoice Derrick Scott, from IMG put it this way: “I don’t know if people grasp just how important the ‘fully managed’ part of that is. We’ve seen property managers whose residents’ insurance lapsed, but no one knew about it. Unfortunately, the resident had a claim during the three-month period they didn’t have insurance. So the property manager took on that liability. “Being fully managed means transferring some of that liability to get that done – and ensuring you have coverage. I see that as a massive benefit.” Every property manager knows insurance matters, but that doesn’t make it any less of a headache. If you want to learn more about how we can partner with you to make that part of your life simpler, check out the details on our Resident Benefits Package.

June 25, 2024

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Accidental Landlord? Why You Should Hire a Property Manager (and How)

In the ever-evolving real estate market, the term "accidental landlord" refers to individuals who find themselves managing rental properties unexpectedly. This can happen for various reasons – perhaps you’ve inherited a family home, moved for a job, or decided to rent out your property instead of selling it in a slow housing market. Certainly, today’s interest rate trends are contributing to the rise of the accidental landlord phenomenon by making it less attractive for homeowners to sell their properties. As interest rates increase, prospective buyers face higher borrowing costs, reducing their purchasing power and dampening demand. This often leads homeowners, who might have otherwise sold their property, to rent it out instead, especially if they’ve locked in lower mortgage rates from previous years. Consequently, many individuals find themselves in the role of landlords unintentionally, seeking rental income as a viable alternative to selling in a sluggish market. Regardless of how you got here, stepping into the role of a first-time landlord can be both overwhelming and time-consuming. In this article, we’ll highlight the importance of professional property management for accidental landlords. Effective property management can alleviate many of the stresses associated with being a landlord, allowing you to reap the benefits of rental income without sacrificing your personal or professional life. We’ll also explain how homeowners can avoid headaches by locking in high-quality long-term tenants with a property manager powered by Second Nature's resident benefits package (RBP). Note that even though we here at Second Nature prefer the term "resident" over "tenant" in order to foster the human element, the word "tenant" may still be used occasionally due to its long-standing legal and real estate context. The Challenges Faced by Accidental Landlords Stepping into the landlord role comes with countless challenges. Understanding these obstacles is crucial in recognizing the value of professional property management. Time management issues One of the primary challenges accidental landlords face is time management. Balancing a full-time job with the responsibilities of managing a rental property can be daunting. From advertising vacancies and showing the property to potential renters to handling day-to-day administrative tasks and responding to maintenance requests, the demands on your time can quickly become overwhelming. This often leads to burnout, which can negatively impact both your professional life and the quality of your property management. Legal complexities Navigating the legal complexities of being a landlord is another significant challenge. Understanding tenant laws, lease agreements, and your legal obligations can be intricate and ever-changing. Landlords must stay updated with local, state, and federal regulations to avoid potential legal issues. This includes everything from fair housing laws to health and safety regulations. Without proper legal knowledge, you risk costly fines and legal disputes. Maintenance responsibilities Maintaining a rental property involves regular upkeep and emergency repairs, which can be both time-consuming and costly. From routine maintenance tasks like lawn care and HVAC servicing to unexpected emergencies like plumbing leaks or electrical issues, ensuring your property is well-maintained is crucial to keeping your residents happy and protecting your investment. Tenant management Managing residents is another area where accidental landlords often struggle. Effective tenant management includes everything from screening prospective tenants and handling lease agreements to addressing disputes, ensuring timely rent collection, and dealing with evictions. Poor tenant management can lead to high turnover rates, property damage, and lost rental income. Financial considerations In the current real estate market, navigating financial considerations can be particularly challenging for accidental landlords. Many find themselves dealing with buy-to-let (BTL) mortgages and managing mortgage payments on their primary residence and rental property. By law, landlords must also adhere to specific regulations, including securing landlord insurance and managing security deposits correctly. Additionally, fluctuating mortgage interest rates have prompted many homeowners, especially in states like California, to rent out their current homes rather than sell them. This strategy not only helps cover mortgage payments but also provides an opportunity for generating passive income, turning a potentially burdensome situation into a profitable venture. Benefits of Hiring a Property Manager Hiring a manager for your investment property can alleviate many of the challenges above, providing expertise, efficiency, and peace of mind. Expertise and experience Property management services bring valuable market knowledge and experience to the table. They understand local rental markets, enabling them to set competitive rental prices that maximize your income while attracting high-quality residents. Their expertise in marketing and leasing also helps minimize vacancies and ensure your property is always occupied. Legal protection and compliance Staying updated with the ever-changing landscape of local, state, and federal laws can be overwhelming for any landlord. Property managers have the knowledge and resources to ensure your property complies with all legal requirements, reducing the risk of costly legal disputes. They handle everything from drafting lease agreements to ensuring fair housing practices are followed. Efficient tenant management Effective tenant management is crucial for a successful rental property. Property managers can help with screening tenants, and handling lease agreements, rent collection, and dispute resolution – ensuring your property is well-managed and your residents are satisfied. Their experience in dealing with tenants can help prevent issues before they arise, saving you time and stress. Maintenance and repairs Property managers have access to a reliable network of contractors and service providers, ensuring timely and cost-effective maintenance and repairs. They conduct regular property inspections and coordinate routine maintenance tasks, keeping your property in top condition and preventing costly emergencies. Financial management Property managers provide detailed financial reporting, helping you keep track of your rental income and expenses. They can also assist with tax benefits, ensuring you take advantage of all available deductions. This level of financial oversight can help you maximize your rental income and make informed decisions about your property. Moreover, effective financial management involves navigating complex notions around capital gains, depreciation, and income tax. Property managers can thus help optimize your financial strategy by leveraging depreciation to reduce taxable income, advising on capital gains implications when selling the property, and ensuring compliance with income tax regulations. This comprehensive financial approach not only enhances profitability, but also secures long-term investment growth. Expenses and Other Financial Considerations When considering whether to hire a property manager, it's important to weigh the costs against the potential benefits. Cost vs. benefits analysis Property management fees typically range from 8% to 12% of your monthly rental income. While this may seem like a significant expense, the potential savings in time, stress, and legal issues can far outweigh the cost. Additionally, property managers often help optimize rental prices and reduce vacancies, increasing your overall rental income. Impact on rental income A professional property manager can help reduce vacancy rates by effectively marketing your property and setting competitive rental prices. They can also help ensure timely rent collection and minimize rent arrears, providing a steady stream of rental income. Over time, these benefits can offset the cost of property management fees. Tax deductions Property management fees are considered a deductible expense, reducing your taxable rental income. This can result in significant tax savings, making professional property management even more cost-effective. How to Choose the Right Property Manager Choosing the right property manager is crucial to ensuring your property is well-managed and your residents are satisfied. As a general note, when choosing a property manager, consider their experience with both short-term and long-term rental strategies. A good property manager will have a solid understanding of real estate investing, including knowledge of high vs. low interest rate environments and the implications for homebuyers and investors alike. For instance, they can provide valuable insights into leveraging buy-to-let mortgages to maximize rental income while ensuring compliance with all relevant laws and regulations. Partnering with reputable realtors and lenders, they can also offer guidance on the best financial practices for managing your rental property, ultimately helping you achieve a balanced and profitable real estate portfolio. Here are some best practices for choosing a property manager: Research and referrals Start by seeking referrals from friends, family, and real estate agents. Online reviews and professional associations can also provide valuable insights into the reputation and performance of potential property managers. Be sure to look for a property manager that offers a resident benefits package (RBP), which can enhance the living experience for your residents and increase retention rates. Interviewing potential managers When interviewing potential property managers, ask key questions about their experience, services offered, and fee structure. Understanding their approach to tenant screening, maintenance, and financial reporting can help you determine if they’re the right fit for your property. Checking credentials and references Ensure the property manager is licensed and certified by relevant professional associations. Request client testimonials and references to gauge their performance and reliability. Understanding the contract Carefully review the property management contract, paying attention to the services provided, fee structure, and termination clauses. What to Expect From a Property Manager Hiring a property manager comes with certain expectations. Understanding these can help you maintain a positive and productive relationship. Regular updates and communication Expect regular updates on your property, including monthly financial reports and maintenance updates. Clear and consistent communication is key to ensuring your property is managed well. Transparency and accountability A good property manager will operate with transparency and accountability, providing detailed financial reporting and being responsive to your concerns. An open-book policy and effective conflict resolution strategies are essential. Proactive management Proactive property management includes preventive maintenance and staying ahead of market trends. A property manager who regularly inspects your property and makes recommendations for improvements can help maintain its value and appeal. Case Study: JWB Real Estate Capital Consider the case of JWB Real Estate Capital, which demonstrates the benefits of long-term leases and proactive property management. By focusing on high-quality residents and providing exceptional service, JWB has achieved a "Triple Win" for owners, residents, and the company. Their approach emphasizes the importance of professional property management in maximizing rental income and minimizing vacancies. The Triple Win concept revolves around creating a mutually beneficial environment where everyone involved sees positive outcomes. For owners, this means consistent rental income and well-maintained properties. Residents benefit from high-quality living conditions and responsive management, while the property management company sees increased retention rates and positive reputation growth. This holistic approach ensures long-term success and satisfaction for all parties involved. Taking the Next Step Hiring a property manager can help accidental landlords avoid the headaches of property management, ensuring that real estate investors are well-protected and their residents are satisfied. That’s because a property manager provides expertise, legal protection, efficient tenancy management, reliable maintenance, and detailed financial reporting. These benefits can help maximize your rental income and reduce the stress of being a landlord. To avoid the headaches, lock in high-quality long-term tenants with a property manager powered by Second Nature's RBP. Visit Second Nature's Solutions for Property Owners for more information. Embracing professional property management can transform the experience of being an accidental landlord from a burdensome task into a rewarding venture. Property managers, if you’re reading this, here's how to attract accidental landlords: Second Nature's Solutions for Property Managers.

June 21, 2024

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Best 17 Single-Family Property Management Software in 2024

Property management software is a booming industry with dozens of options for multifamily and single-family property management companies. Today we're going through the best software for single-family property managers, and tips from two experts on how to leverage the software best. What we'll cover Our two experts, Kelli Segretto and Rhianna Campbell, have been through more than their share of tech rollouts. They’ve seen what works and what doesn’t for single-family property management, and they’re here to share with you what a good process for building a tech stack actually looks like. For this article, they walked us through some of the best property management software for single-family homes. These apps and platforms can help with everything from: Rent collection Work orders Credit card payments Online rent payments Tenant Screening Lease management Maintenance management CRM Let's jump right in with the top 17 software solutions for single-family property managers. The first six in our list are software solutions specifically and exclusively designed for property managers. 1. RBP by SecondNature Second Nature pioneered the property management industry’s first-ever fully managed Resident Benefits Package (RBP). The RBP includes critical services that more and more residents are asking for – and are willing to pay for. It's not just a package of services, though. The RBP is a tech platform that helps single-family property managers boost retention by creating a better resident experience and incentivizes better resident behavior with support like resident rewards and credit building for on-time rent payments. Campbell says that she looks for technology that can support both her team and the resident experience: “One of the things I want my clients to think about is the property management software is not just for our benefit," Campbell says. "This is not just to make our lives easier and our jobs easier; it's to really be able to reposition our time so that we're focused on value creation.” RBP by Second Nature generates value through: Attracting and retaining residents Boosting rental rates through improved resident experience Giving PMCs a competitive advantage Driving ancillary revenue opportunities Incentivizing good resident habits like on-time rent payments, property care, etc. The RBP supports PMCs by managing services like credit building, air filter delivery, maintenance requests, renter’s insurance programs, resident rewards, and more. The RBP by SecondNature provides services that residents and investors love, and that support you and your team. 2. Appfolio Appfolio is another cloud-based software that can be used for single-family property management and helps automate tasks and workflows for PMCs. They support real estate and property management professionals in digitizing their business operations, and support every aspect of your workflow with management, training, marketing and leasing, maintenance, accounting, and communications. They're one of the most popular apps for single-family property managers, thanks to the easy-to-use platform, automation, and customizable dashboards and reporting. 3. Buildium Buildium is another all-in-one property management software for both single-family homes and multifamily apartments. They provide management tools for accounting, leasing, maintenance, a mobile app, and integration services. Their platform includes tenant and owner portals and templates for leases, listings, reports, and more. We like their 14-day free trial that helps you really evaluate if the tech is a fit for your team, and get buy-in. Plus, their analytics are some of the best. 4. PropertyWare PropertyWare is a rental property management software for single-family properties. The software helps manage every aspect of a PMC workflow, from listing, leasing, managing payments, ordering and tracking maintenance, accounting, and more. Tenants and owners have a portal with 24/7 access that you can customize. Customers like that the system can easily scale and makes communication easy, but some of the downsides include that the reports are less customizable than other options and glitches sometimes take a while to get fixed. 5. PropertyBoss PropertyBoss is a platform solution that supports property managers for student, multifamily, and single-family rentals. Manage phone calls, work orders, financial statements, and rent payments all in one place. They aim to help property managers automate and run services without needing to scale up their teams. It's fairly customizable with an excellent QuickBooks integration and other financial packages. It's not as intuitive or easy to learn as some of the other options, but great for robust support. 6. YardiBreeze YardiBreeze is another cloud-based property management software for small to medium-sized owners or property managers. They have solutions for both residential properties and commercial. On the residential side, their app allows you to manage all your properties on one device with tasks and activity calendars and tracking, workflow managment, leasing, rent collection, accounting, owner tools, maintenance, and more. It's one of the easiest to use of all the apps on our list, but it does require some workarounds for reports and can be difficult to organize. 7. Rent Manager Rent Manager is another software built specifically for property managers. It's an operations platform solution that combines all the tools you need to run your property management business. Its features include accounting tools; operations support like communication, a call center, a mobile app, and an owner portal; reporting and automation; maintenance management; marketing and leasing; and software customization. Like PropertyBoss, the platform can be difficult to learn, and some features may only be used if your team keeps up to date with training. Now let's move into a group of apps that are focused on serving both property managers and landlords. 8. Innago Innago is a free rental property management software for small to mid-sized landlords and property managers. The software helps with rent collection, leasing, and tenant management all on the cloud. Everything is collected in a straightforward dashboard tracking rent collection, managing late fees, invoice automation, online leasing and document storage, and more. The app has a very high rating among customers and is particularly easy to use with a slick and professional interface for residents. 9. TenantCloud TenantCloud is a cloud-based property management software connecting property managers, owners, landlords, tenants, and service vendors. Its capabilities include posting listings, collecting rent online, and screening applicants. Overall, the interface is fairly intuitive, even from the back-end accounting and maintenance management. The software puts most of the responsibilities of property management in one place and streamlines workflows and communication. On the downside, some of the features, especially related to payments, aren't very customizable, and the software can be slow. 10. DoorLoop DoorLoop is a property management system that provides services like a built-in CRM, tenant portal, owner portal, and rent collection. Like other platform solutions, you can handle most of your workflows and tasks within the app and use their tools to build reports, track payments, and communicate with tenants and owners. The UX is intuitive and user-friendly, with excellent integration capabilities. Some functionalities are still being built, but it is overall an excellent solution for single-family property managers. 11. Hemlane Hemlane is a platform solution for landlords and PMs that supports and automates the day-to-day tasks of managing rental properties. It includes a user-friendly tenant portal for online payments, plus tools for lease management, listings, tenant screening, applicant tracking, maintenance and repairs, and more. Their UX and user-friendly design stand out among competitors, but if you need really robust accounting tools or reporting for single-family property management, you may want to go with a different option. 12. Rentec Direct Rentec Direct is a platform solution with full features for property managers and landlords managing properties. The web-based solution includes general ledger accounting and financial reporting that you can integrate with Quickbooks, and accept online payments from tenants through a tenant portal and app. The platform supports tenant and owner communication, listings, marketing, billing, tenant screening, and more. One unique feature is their US-based customer service team. The app is missing some advanced features that you can find with other solutions supporting single-family property management, but they are adding more regularly. 13. ManageCasa ManageCasa is built for landlords, property managers, and community associations. The platform provides full-service owner and tenant portals, lease management, digital documents, accounting and reporting, online payments, and marketing tools. You can build a marketing website, manage listings and leasings, and automate workflows, all with the support of a 24/7 customer service team. Some of the reporting and banking tools are not as robust as other single-family property management software options, but the marketing and communication portals are a standout. And, finally, let's look at a group of apps focused primarily on serving landlords, though some single-family property managers may find the technology useful. 14. Avail Availa is a landlord software that helps property owners or "DIY landlords" find and screen tenants, sign leases, and collect rent. It's focused on helping landlords be more hands-off and helps manage the onboarding of new tenants, leases, and even maintenance requests or work orders. The platform helps track payments and maintenance costs, too. A few cons are the app is sometimes slow, and the payment portal isn't as easy to use or customizable as some competitors. 15. Stessa Stessa provides real estate investors with single-family and multi-family rentals an easy platform to track, manage, and communicate. Their tools focus on supporting rental applications, tenant screening, rent collection, banking, and accounting. One standout feature is the Stessa Tax Center, which helps guide landlords/owners through the complexities of filing their taxes. One downside is the single-entry accounting system, which doesn't allow for more robust accounting. But for basic tracking all in one place, it's an excellent tool. 16. Landlord Studio Landlord Studio also helps DIY landlords with finding, screening, and placing tenants. Their portal includes online rent collection and tax reporting. Plus, they have a feature for responding to maintenance requests, prioritizing tasks, and easily communicating with tenants. It's very easy to use and relatively inexpensive for what it offers. However, their pricing structure can make it tougher to scale up with charging per unit, and some users find the features difficult to customize. 17. RentRedi RentRedi is a mobile app for landlords to help manage their properties. Landlord features include listing, tenant screening, lease support, rent collection, rental property accounting, and renter's insurance. Their tenant features include a tenant app that supports different forms of rent payment, application tracking, credit building, and more. A few downsides include some glitchiness in the integrations with Zillow and Trulia, and a lack of transparency into all communication sent to tenants. How to choose the right software for your single-family property management business Now it's time to turn to our two property management experts for insight on how to pick the right software from the list above. Meet the Experts: Rhianna Campbell and Kelli Segretto are two property management consultants who combine more than 35 years of property management experience. Kelli Segretto is the founder of K Segretto Consulting and a 20-year veteran of property management. Rhianna Campbell is a property management consultant and speaker with Proper Planning LLC, and former CEO with over 15 years of experience in the industry. Campbell and Segretto walked us through the process of identifying the best software for your property management business. Define the problem you want to solve with software “Start with your issues list,” says Segretto. “Realize what your biggest need is first and choose technology that matches that need. Talk to your fellow PMs, join these mastermind groups, attend Triple Win LIVE events, network on Facebook, and talk to other people to find out what’s working for them.” The biggest mistake PMs make when trying to build a useful tech stack is collecting as many programs as possible and trying to jump directly into a fully functional stack instead of identifying solutions and rolling them out strategically. Instead, says Campbell: “I talk to every single employee and find out what their biggest challenges are,” says Campbell. “And then from there, you can really pull out some of the commonalities that everyone seems to be having.” Below is an example of an issue list template Segretto uses in meetings with her clients. Issues List Template from K Segretto Consulting Vet potential PM software vendors When vetting specific technologies, Segretto suggests asking for a sandbox instead of just a demo. “Ask for a sandbox to where you can actually play with it, manipulate it, break it, find where those weaknesses are in that software before you commit to it,” Segretto says. She also recommends seeking referrals to users who have used the software successfully and who have tried the software and decided against it. Being able to understand those different perspectives will help you see a complete picture of who the software is for, where it excels, and where it may come up short. Get buy-in from your team & track performance “I’ve seen hundreds of businesses launch technology across the nation and helped them implement. Ones that tend to fail are the ones that are not prepared,” says Segretto. “What I mean by not prepared is they don’t have their team’s buy-in. They don’t even know what they really want the technology for. They just feel like they want it, and they want it right now. They’re not willing to dedicate a resource or a person that’s going to own it. Without that ownership, tech stacks fail.” Getting buy-in from your team is critical for any implementation. The people who are using the tech need to believe in and understand it. Nothing guarantees failure more than just throwing a new service at someone. “You’re prepping your team, you’re talking about it, and you’re giving those ‘why statements’ so that everyone is on board before you launch. All of that needs to happen in your pre-implementation,” says Segretto. You also need to identify who on your team is the point person for the new tech rollout. According to Segretto: “You have to pick a designated person who's going to be the owner of that technology. Then, as you implement, they're going to be the expert.” Finally, monitor the tech’s performance. Campbell says you need to conduct regular reviews of your tech’s performance much the same way you would of your team’s performance. “Being able to evaluate whether or not that technology is working is really important,” says Campbell. “I've seen a number of times where people buy into the tech and then don't use it. It’s important to have points in time where you check to see if you're really utilizing that software that you paid a lot of money for, and not just spending money on it every month.” Final Thoughts Tech is a good thing. Don’t let the length of this article about implementation scare you into thinking it’s more complex than it is. As long as you’re willing to manage your tech stack and make sure your team knows how to use it, you’re going to be in good shape. You wouldn’t bring on a new employee for no reason, so don’t add tech for no reason. Tech is a tool, and its power is determined by the person who wields it. If you’re purposeful and thorough, you can vastly improve the efficiency of your business with the ever-growing field of PropTech companies in existence. Learn more about how Second Nature is supporting property managers with leading tech solutions and services that residents pay and stay for.

June 21, 2024

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Property Management Skills Shared by Top Performers: Mastering the Art of Excellence

In the high-stakes world of property management, professionals are constantly juggling a multitude of responsibilities, from resident relations to financial oversight. The pressure is immense, and it's no wonder that over 25% of real estate property managers (PMs) are expected to abandon the industry within the next five years. The burnout is real, and the struggle to find enough time is a common theme among PMs. However, mastering a set of crucial skills can significantly alleviate these pressures and transform careers. These top skills include communication, organizational prowess, financial acumen, relationship building, and adaptability. In today’s post, we’ll examine these "big five" skill sets that truly elevate good property managers to great. Note that even though we here at Second Nature prefer the term "resident" over "tenant" in order to foster the human element, the word "tenant" may still be used occasionally due to its long-standing legal and real estate context. 1. Communication: Building Bridges and Trust Strong communication skills are the cornerstone of successful property management. Clear and concise communication ensures that all parties involved are on the same page, reducing misunderstandings, boosting negotiation skills, and fostering a collaborative environment. Clear and concise communication Effective communication is not just about speaking or writing well; it's about conveying a message in a way that is easily understood by everyone involved. This means avoiding jargon, being direct, and tailoring communication styles to different audiences (for instance, how you’d communicate with a potential tenant about maintenance issues might differ from how you’d interact with a contractor or a rental property owner). Active listening Active listening is equally crucial, particularly when it comes to tenant concerns. It involves fully concentrating, understanding, responding, and then remembering what is being said. This skill helps constructively address the concerns of residents, thereby enhancing their satisfaction and trust in your organization’s brand of management. Multilingual capabilities In today's multicultural society, having multilingual capabilities can be a significant asset. Being able to communicate in multiple languages broadens your reach and improves interactions with a diverse resident base, making you a more inclusive and effective property manager. 2. Organizational Prowess: Keeping the Plates Spinning A top-notch property manager excels in organization. After all, with so many moving parts, a systematic approach to managing the details is essential to keep everything running smoothly. Time management Effective time management is about prioritizing tasks and ensuring that important issues are addressed promptly. Utilizing tools such as calendars, to-do lists, and project management software can help to manage available time more efficiently. Attention to detail Paying close attention to details ensures that nothing falls through the cracks. This could be as simple as ensuring that property building maintenance requests are logged correctly or as complex as meticulously reviewing financial statements for discrepancies. Strong record-keeping Keeping accurate and detailed records is fundamental. From lease agreements to property maintenance logs and financial records, strong record-keeping practices help in staying organized and prepared for any situation, including legal issues. Marketing savvy In addition to operational tasks, being marketing-savvy is a vital organizational skill. This includes knowing how to market properties effectively to attract and retain renters, using traditional methods as well as social media and other digital platforms. 3. Financial Acumen: Keeping the Bottom Line Healthy Financial acumen is about understanding and managing the financial aspects of property management to ensure profitability and sustainability. Financial management: budgeting and forecasting know-how Creating and adhering to a budget is crucial. This involves forecasting future expenses and revenues to ensure that the property remains profitable. Effective budgeting helps in planning for unexpected costs and allocating funds where they are needed most. Rent payments Efficient rent collection processes are essential to maintaining cash flow and ensuring timely payments. This includes implementing automated systems for rent collection and tracking payments to minimize late or missed payments and maintain a steady revenue stream. Financial reporting Generating accurate financial reports is critical for monitoring financial performance, identifying areas for improvement, and making informed decisions. These reports provide insights into rental income, expenses, and profitability, helping property managers to stay on top of their financial health. Understanding rental markets Staying informed about property values and rental market trends allows you to set competitive rental rates, ensuring maximum occupancy and profitability. This involves understanding local market conditions and pricing, vacancy rates, economic factors, and demographic trends. 4. Relationship-Building: The Cornerstone of Trust Building strong relationships is at the heart of property management. This involves fostering trust and ensuring that all stakeholders are satisfied. Excellent interpersonal skills Interpersonal skills are essential in managing relationships with residents, contractors, and property owners. Being approachable, empathetic, and professional helps in building a positive rapport with all parties involved. This helps boost such critical indicators as tenant satisfaction and tenant retention. Conflict resolution Conflicts are inevitable in property management. Whether it's a dispute between residents or an issue with a contractor, having effective conflict resolution skills is key to maintaining harmony and ensuring that problems are resolved swiftly and fairly. Responsiveness and follow-through Being responsive to queries and requests shows that you value and respect others' time and concerns. Following through on commitments builds trust and reliability, which are essential in maintaining strong relationships. Customer service In the context of day-to-day operations, excellent customer service skills are about much more than resolving issues. They’re about creating a positive experience for residents, which can lead to higher retention rates and positive word-of-mouth referrals. 5. Adaptability: Thriving in a Dynamic Industry The property management industry is dynamic and ever-changing. Top performers thrive in this environment by being adaptable and open to change. Problem-solving Effective problem-solving involves identifying issues, evaluating options, and implementing solutions quickly and efficiently. This proactive approach ensures that problems are addressed before they escalate. Staying current with regulations Regulations and laws related to property management are constantly evolving. Staying current with these changes is essential to ensure compliance and avoid legal issues. This involves regular training and keeping abreast of local, state, and federal laws. Embracing technology Technology is transforming property management. Embracing new technologies such as property management software, smart home devices, and digital marketing tools can streamline operations and improve efficiency. Final Thoughts Elevating a property management career can rest in large part on mastering the skills of communication, organizational prowess, financial acumen, relationship-building, and adaptability. These skills not only help in managing day-to-day challenges, but also pave the way for long-term success and job satisfaction. Of course, obtaining relevant real estate industry certifications is a clear demonstration of a property manager's expertise and professional development. Certifications such as the Certified Property Manager (CPM), Residential Management Professional (RMP), or the Certified Apartment Leasing Professional (NALP) provide recognition of specialized knowledge and skills, enhancing credibility and career advancement opportunities. But in the end, the ideal job description is often about finding the sweet spot that lies at the intersection of what you love to do, what you’re good at, what the world needs, and what you can be paid well for. By focusing on the essential skills we’ve highlighted here, property managers can find greater fulfillment in their work, knowing that they are making a difference while doing something they excel at and enjoy. Learn more about property management company best practices, marketing, and more in our Second Nature Community.

June 21, 2024

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Property manager filling out rental inspection check list

SFR Property Management Problems and Solutions

In recent years, the single-family residence (SFR) rental market has seen significant growth as more property owners recognize the potential for steady income and long-term appreciation. With this rise in popularity comes a unique set of challenges for the rental property managers (PMs) who are tasked with overseeing these properties. Related: What is the resident benefits package? Unlike multi-family units, managing single-family homes can present a range of issues that require tailored solutions. Scattered-site properties also present a logistical challenge, as they are by nature harder to service and manage. From finding quality residents to handling unexpected maintenance emergencies, a strategic and proactive approach is required to ensure a smooth and profitable rental experience. Note that even though we here at Second Nature prefer the term "resident" over "tenant" in order to foster the human element, the word "tenant" may still be used occasionally due to its long-standing legal and real estate context. What Are the Most Common Property Management Challenges? The most common problems faced by SFR property managers generally fall into three buckets: finding quality residents; maintenance and repairs; and time management and communication. Let's explore each. #1 Finding Quality Residents One of the most critical aspects of managing SFRs is resident placement. Indeed, inadequate resident screening processes can significantly impact resident retention as well as profitability. That’s because poor screening can lead to high turnover rates (including evictions), increased property wear and tear, and ultimately, financial strain. Additionally, attracting responsible residents who will treat the property with care and adhere to lease agreements can be particularly challenging in competitive rental markets. #2 Maintenance and Repairs Unexpected maintenance issues are a common hassle for SFR property managers. From plumbing leaks to HVAC failures, emergencies can arise without warning, leading to unplanned expenses and logistical challenges. Finding reliable and responsive contractors who are able to address repairs promptly adds yet another layer of complexity. The inability to swiftly manage these issues can result in resident dissatisfaction as well as potential property damage. #3 Time Management and Communication Managing multiple single-family homes requires excellent time management skills. Balancing the diverse needs of residents, coordinating with vendors, and ensuring regular property inspections can be overwhelming. That’s why it’s essential to establish clear and timely communication channels to maintain good resident relationships and efficient operations. However, juggling these responsibilities can lead to lapses in communication, resulting in time-consuming misunderstandings and unresolved issues. Solutions for a Smoother SFR Rental Experience While the challenges of managing SFR rentals are significant, there are effective strategies and tools available to streamline operations and enhance resident satisfaction. Here are some solutions to common property management business problems. Strategic Resident Screening Implementing a robust resident screening process is crucial for minimizing vacancy rates and securing responsible residents. To this end, utilizing professional screening services can help identify prospective tenants by thoroughly evaluating their rental history, credit scores, and background checks. Clear lease terms and expectations should be established from the outset to ensure residents understand the responsibilities and obligations that occupancy brings. Learn more: Tenant Screening Tips for PMs 10 Steps to Onboard New Tenants Proactive Maintenance Proactive maintenance is key to preventing costly emergencies and maintaining the property’s condition. Scheduling regular preventative maintenance inspections allows property managers to identify and address potential issues before they escalate. Building relationships with reputable and responsive repair professionals ensures that maintenance tasks and requests are handled promptly. Consider leveraging technology that allows residents to conduct their own regular inspections to provide early detection of problems and streamline the property maintenance process (learn more). Vendor and Supplier Selection Choosing the right property management service providers and vendors is crucial to successful property management. Establishing relationships with reliable and responsive contractors ensures that maintenance and repair issues are addressed promptly, reducing downtime and inconvenience for renters. It’s essential to vet vendors thoroughly, checking their credentials, references, and reviews to ensure they meet the necessary quality and reliability standards. Building a network of trusted professionals can lead to better service rates, priority scheduling, and consistent adherence to due dates as well as work quality standards. Additionally, negotiating long-term contracts with preferred vendors can offer cost savings and a more streamlined management process. By prioritizing quality vendor and supplier selection, property managers can enhance the overall efficiency of their operations and maintain high tenant satisfaction. Technology and Automation Incorporating technology and automation into property management can significantly enhance efficiency and communication. For instance, online portals for collecting rent payments and addressing maintenance requests simplify transactions and ensure transparency. They can also facilitate incentives for prompt rent payment, follow up on late payments, and generally optimize rent collection with an eye to optimizing cash flow. Property management software can also streamline vendor and tenant communication, track maintenance schedules, and provide detailed financial reporting. These tools not only save time but also build trust and improve resident satisfaction by ensuring quick and effective responses to their needs. Naturally, you will need to conduct a due diligence process of technology selection and provider assessment that addresses pricing, customer support, and support for the features that are mission-critical for your organization. Related: Property Management Laws and Regulations by State Second Nature’s Outlook Effective property management is essential for maximizing the profitability and longevity of single-family home rentals. By addressing common challenges with strategic solutions, property managers can enhance resident satisfaction, reduce vacancy rates, and maintain the property’s value. Embracing technology and proactive management practices are critical components of any successful SFR business strategy. Property managers are encouraged to explore these solutions and adopt the approaches that best suit their specific needs. Learn more about property management company best practices, marketing, and more in our Second Nature Community.

June 7, 2024

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How to Craft a Notice to Tenant to Clean Property [with Template]

Ensuring that rental properties are well-maintained is crucial for property managers and landlords, not only to protect the value of their real estate investment but also to provide safe and pleasant living environments for residents. One important tool for maintaining property standards is a "Notice to Tenant to Clean Property" letter that communicates concerns about cleanliness and outlines necessary actions for residents. In today’s post we’ll cover essential elements you should consider around transparency and effectiveness, as well as a sample letter you can use to craft your own notice. Related: Free Property Management Agreement Template A note on language: Here at Second Nature, we prefer to use the terms "resident" and “residency” rather than “tenant” and “tenancy,” in order to emphasize the human element of property management work. However, there may be instances where terms such as "tenant" are used for legal or industry-standard purposes within documents or communications. In these cases, please understand that our intent remains the same – to provide clear, accurate, and meaningful information to all people involved in the business relationship. What to Do When Your Tenant is a Hoarder? Hoarding can present significant challenges for property managers. It not only poses health and safety risks but can also lead to severe property damage. Here are steps to take when dealing with a hoarding situation: Understand the issue Hoarding is often a complex psychological condition that requires sensitivity and understanding. It’s important to approach the situation with empathy and awareness of the resident’s potential mental health needs. This understanding can guide your interactions and help you manage the situation more effectively. Conduct thorough inspections Regular property inspections are crucial for identifying hoarding behaviors early. These inspections should be conducted in accordance with the lease agreement and local laws. Document any findings with photographs and detailed notes to provide a clear record of the condition of the property. Communicate clearly and compassionately When addressing the issue with the resident, clear and compassionate communication is key. Explain the concerns and the potential consequences if the situation is not addressed. Emphasize that the goal is to ensure a safe and habitable living environment. Provide a formal notice If the hoarding issue violates the lease agreement, a formal "Notice to Clean Property" may be necessary (more on this below). Collaborate with professionals In severe cases, it may be beneficial to involve professionals who specialize in hoarding disorder. This can include social workers, mental health professionals, or professional organizers who can provide the resident with the necessary support to address their hoarding behavior. Follow legal procedures Ensure all actions taken are in compliance with local and state laws. This includes providing the correct amount of notice, following proper eviction procedures if necessary, and respecting the resident’s rights throughout the process. Document all actions Keep thorough records of all communications, inspections, and notices related to the hoarding issue. This documentation can be crucial if legal action becomes necessary and helps protect you as the property manager. By addressing hoarding with a combination of empathy, clear communication, and adherence to legal requirements, property managers can manage these challenging situations more effectively while maintaining the safety and integrity of their properties. Identifying When a "Notice to Clean Property" Letter is Necessary A "Notice to Clean Property" letter becomes necessary under various circumstances. It's essential to recognize these situations in order to maintain the property's value and condition, and to ensure compliance with lease agreements. Routine inspections Routine inspections are an integral part of property management, allowing managers to identify issues early and address them before they escalate. If an inspection reveals unsanitary conditions, excessive clutter, hoarding, or neglect of cleanliness, a formal notice is warranted. This proactive measure helps maintain the property and encourages residents to uphold their end of the lease agreement. Failing to address these issues promptly can lead to severe problems such as mold growth, pest infestations, plumbing issues due to neglected maintenance, and increased costs associated with turnover when a property is vacated. Complaints Neighbor complaints regarding cleanliness issues, such as uncollected trash, odors, or visible clutter, can indicate a need for intervention. Addressing these complaints promptly with a notice demonstrates that management is responsive to concerns and committed to maintaining a harmonious living environment. Ignoring such complaints can exacerbate the problem, leading to pest infestations that can create an unhealthy living environment for residents. Lease violations Most lease agreements include clauses that outline residents' responsibilities for maintaining the property in a clean and sanitary condition. When these clauses are violated, issuing a notice is necessary to enforce the lease terms and remind residents of their obligations. Failing to act on these violations can result in significant property damage, including plumbing issues from unaddressed leaks or blockages, mold growth from damp conditions, and ultimately, costly repairs and renovations needed to restore the property for the next resident. This can also lead to increased turnover costs, as the property may need extensive cleaning and repairs before it can be re-leased. The Importance of Clear Communication Open and effective communication is vital in property management, especially when addressing cleanliness issues. A clear, well-crafted notice helps prevent minor issues from becoming major problems and sets the stage for resolution. Proactive approach Early intervention through timely communication can prevent minor cleanliness issues from escalating into significant problems. Addressing concerns as soon as they are identified shows residents that management is diligent and proactive. Setting expectations A well-crafted notice clarifies expectations for resident maintenance responsibilities. By explicitly stating what is required, renters understand their obligations and the standards of occupancy they must meet. Documentation The notice serves as a documented record of the identified issue and the steps taken to address it. This documentation is crucial for protecting the property manager's interests if further action is needed, such as additional fees or eviction proceedings. Note that property managers can proactively address cleanliness and maintenance issues by clearly setting expectations with new tenants from the outset. This can be achieved by including a detailed cleanliness clause in the lease agreement, conducting a thorough walkthrough of the rental unit at move-in, and providing a welcome packet to ensure each tenant knows their responsibilities. During the initial walkthrough, managers should highlight specific cleaning requirements and standards, demonstrating proper care for different areas of the property. Regular communication, such as periodic reminders and tips for maintaining the property, can further reinforce these expectations and prevent issues from arising, ensuring a smooth and mutually respectful resident-PM relationship. Crafting a Compelling and Effective Notice Creating an effective "Notice to Clean Property" involves several key elements that ensure clarity and encourage compliance. Introduction Begin the written notice with a clear statement of its purpose as a formal notification regarding the property's cleanliness and upkeep condition. Include the property address and the resident's name(s) to avoid any confusion. Specific observations Detail the cleanliness issues observed during the inspection or reported by others. Use clear, descriptive language to ensure there is no ambiguity about the concerns. For example, instead of saying "the property is dirty," specify "dirty dishes are piling up, attracting roaches/pests; or “an abundance of waste materials is creating a health hazard/fire hazard." This also helps differentiate the cleanliness issue from normal wear and tear. Reference to lease agreement (optional) If applicable, cite relevant clauses in the rental agreement that outline the resident’s responsibility for maintaining the property in a clean and sanitary condition. This reference reinforces the legal basis for the notice and the resident's obligations – and helps ensure that you are respecting applicable tenant rights and state laws. Outline of expectations Clearly define the expected level of cleanliness and specific actions required to rectify the situation. A timeframe for follow-up is useful for helping the resident to address the issues, such as a 7-day notice period to clean. This approach gives residents a clear understanding of what needs to be done and by when. Consequences for non-compliance (optional) Briefly outline potential consequences for failure to address the cleanliness concerns within the designated timeframe. This might include increased inspections, withholding of security deposits, or legal action, including a potential order to vacate/eviction notice. Note that although it may well become necessary to instigate an eviction process, it’s important to maintain a professional tone and avoid excessive threats to encourage cooperation. Related: How to Write a Tenant Welcome Letter + Free Template Additional Considerations for Specific Situations Different scenarios may require tailored approaches when issuing a proper notice to clean the property. Health and safety hazards If the cleanliness issue poses a potential health or safety hazard, such as mildew/mold growth, pest infestations, or overflowing sewage, prioritize immediate action. In such cases, involving relevant authorities might be necessary to ensure the issue is resolved promptly and safely. Chronic offenders For residents with a history of neglecting cleanliness standards, consider outlining a stricter course of action. This might include increased inspections or even potential lease termination if the behavior continues. Clear documentation and a consistent approach are essential when dealing with chronic offenses. Delivery Methods and Maintaining Records Ensuring that the notice is delivered and documented correctly is crucial for effective property management. Delivery methods Consider the following methods for delivering the notice: Hand-delivery with a signed receipt: This method ensures the resident receives the notice and acknowledges its receipt. Certified mail with return receipt requested: This provides documented proof that the notice was sent and received. Other methods with documented proof of delivery: Any method that provides verifiable proof of delivery is acceptable. Maintaining records Retain copies of the notice, delivery confirmation, and any relevant communication for your records. This documentation is crucial if further action is necessary and serves as evidence that the issue was addressed appropriately. Free “Notice to Tenant to Clean Property” Template Providing a template can simplify the process for property managers. However, it's essential to note that legal advice is recommended to ensure compliance with local laws and regulations. ``` [Your Name] [Your Address] [City, State, ZIP Code] [Date] [Resident's Name] [Property Address] [City, State, ZIP Code] Re: Notice to Clean Property Dear [Resident's Name], This letter serves as a formal notification regarding the cleanliness condition of the property located at [Property Address]. During a recent inspection conducted on [Date], the following issues were observed: - [Detail the specific cleanliness issues] As per the lease agreement, Section [Lease Section], you are required to maintain the property in a clean and sanitary condition. To rectify the situation, please take the following actions by [Specify Deadline, e.g., 14 days from the date of this letter]: - [List the specific actions required] Failure to address these concerns within the specified timeframe may result in [potential consequences, such as additional fees, increased inspections, or eviction proceedings]. We appreciate your prompt attention to this matter. Please contact us at [Your Phone Number] if you have any questions or need further clarification. Sincerely, [Your Name] [Title] [Contact Information] ... Promoting a Culture of Responsibility Maintaining a clean and well-kept property is a shared responsibility between residents and property management. By promoting a culture of responsibility, property managers can create a positive living environment that benefits everyone involved. Encouraging residents to take pride in their living spaces and providing resources such as Second Nature’s Resident Benefits Package (RBP) can foster this culture. The RBP can include regular maintenance tips, access to cleaning services, or rewards for maintaining high standards of cleanliness. Ultimately, a collaborative approach leads to what we at Second Nature call a "triple win" — residents enjoy a pleasant living environment, owners maintain their investments, and PMs have an easier role to play in maintaining these thriving, beneficial relationships. Learn more about Second Nature’s RBP.

June 7, 2024

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