How Landlord Lost $43,000
According to the news report, the landlord told police that the damage is so extensive, the garage will have to be demolished.
The landlord says she rented to a long-term tenant for six years, and only recently discovered that her tenant had sublet to someone else. She does not know the whereabouts of the original tenants, according to the report.
It’s common to believe that long-term tenants are the best solution of a rental property because these tenants are more stable. But, as this landlord learned, receiving rent each month is not enough to sustain a profitable rental business. Day-to-day management is crucial.
You can avoid similar risks by taking these steps:
1. Make sure you collect enough data in the rental application to locate the tenants if they skip out.
2. Restrict subletting in your lease agreement so that tenants must get approval.
3. Check out the property often throughout the term of the lease.
4. Don’t let long-term leases become an excuse to put off routine maintenance. The longer the tenant remains, the worse the condition of the property when they leave.
5. Require tenants to update the information in the rental application so contact information is current. This is necessary to deal with emergencies, too.
6. While cashier’s checks and money orders seem like a safer method of payment, landlords insisting on these methods lose out on the opportunity to see changes in a tenant’s banking information, which is crucial in the debt collection process.
American Apartment Owners Association offers discounts on products and services for all your property management needs. Find out more at www.joinaaoa.org.