Use A Move In Inspection Report, Already. Geez.

Caught this hot piece on the Globe and Mail today. A little ditty called “How To Steer Clear Of Bad Tenants”. In it – the move in inspection report is cited as the second most important document between the landlord and his/her tenant, besides the actual lease. Here’s the kicker. Most landlords don’t use one.

This is interesting. When you rent a car they use one. When you rent a boat they use one. Hell…I remember renting movies at Blockbuster and getting a call about the DVD copy of State of Grace I rented once looking like it had been dropped when they opened the case. Some people think they’re experts at “reading” other people. They convince themselves out of the necessity to cover all the bases. They don’t check credit scores. They don’t call previous landlord references. They just assume that since the new tenant they just rented a unit to is employed and capable of paying the rent, the likelihood of a kegger is minimal or non-existent.

I’ll cut to the chase. You should always use one. It’s the basis of an understanding – one that is paired with a mutual acknowledgement between you and the individual(s) renting from you, that what you are providing is in a certain condition prior to move in, and that it is meant to be returned to you in a certain condition. It’s as simple as that. Using a move in inspection report has the potential to save you money, clear up any excuse of miscommunication, and covers you in the event of something going south.

In British Columbia, a Condition Inspection Report is required by provincial law. The tenant and the landlord need to complete, sign, and date the form to show the condition of the residential premises at the beginning and end of the rental agreement. B.C. is smart about this, especially with such a great concentration of renters. Think about it – one of the biggest sources of conflict between landlord and tenant is often condition of apartments. A mutually acknowledged and signed off report greatly reduces the number of hearings that go to the LTB. The Northwest Territories, Alberta, and Nunavut also require signed and mutually acknowledged inspection reports to be completed.

It’s not the law in other provinces, however, they’re still highly recommended and it doesn’t mean you can’t use them. The CMHC put together a handy little rundown of what you should look for and point out when doing an inspection. Here’s a taste.

  • Walls and ceilings: note any dents, holes, or cracks in the plaster; scuff marks that don’t rub off; tears, bubbles, or peeling wallpaper.
  • Floors: note stains or discolouration in carpets; tears in linoleum; cracked or chipped tiles; dents, scuffs, or stains on hardwood floors.
  • Trim (including moldings, door and window sills and door and window frames): note stains, cracks, leaks or other problems.
  • Electrical outlets and lights: make sure they function.
  • Bathroom(s): make sure all faucets (hot and cold) work without leaking; water runs clear, not brown or yellow; water carries sufficient pressure in the shower and toilet; hot water tank holds enough for your needs. Check for chips or scratches in fixtures and tiles; walls around the tub for “sponginess”; countertops for dents, scratches, or stains.
  • Kitchen: make sure all faucets (hot and cold) work without leaking; water runs clear, not brown or yellow; all appliances work and are clean. Check for chips or scratches in fixtures and tiles; countertops for dents, scratches, or stains.
  • Exterior doors and windows: make sure they seal properly and the locks work; watch for signs of water.
  • Deck, balcony or patio, if applicable: check for chipped stone, warped or cracked boards, or problems with exterior siding.

Smart indeed. You can see the full list here. Need a template for one? Here’s one.

A Little Glimpse Into Why We’re Doing This…

Two years ago, we all teamed up in Vancouver with two things. A revelation and an idea.

The revelation was that we knew that the web could make what we considered to be the thankless job of being a small landlord easier. We also knew that easier and simpler didn’t have to be mutually exclusive.

The idea was to make a nifty web based software that actually achieved this fine balance. We were on our second tour of duty after having sold our first web based app- a little referral marketing product called Hello Referrals. We decided to use the proceeds from the acquisition of that product to develop what would eventually become Renting Well. There was a couple of months of us deciding over names. Rent Well. Rent Cloud. Renting Simple. Renting Easy….the list went on. Besides the fact that we couldn’t secure domain names for any of these, we felt the name Renting Well better suited the vibe of something active and didn’t fall into the dearth of other products that claimed to take years off of your life and seemed to also dwell with Lando Calrisian in cloud city.

One of the first considerations we had when building the app was how we could include less of everything. Less questions and set up. Less complication. Less of a wait to see important metrics. We felt the best course of action was something that you logged into, and essentially “got” within the first 2 minutes. We also knew that there was a necessity for the user to perform data entry in order to get those very things that we wanted quickly visible. Developing a flow to Renting Well that took this into consideration was also high on our list of priorities. Not an easy task. Some people prefer more complex analysis of what’s going on. Some people also aren’t jazzed about back data entry. As the old adage goes, you can’t please everyone – but we were still determined to get this off the ground in a broadly effective way.

We decided to focus on 3 core initial features.

  1. An easy to reference chronological logbook to track events, incidents, problems, and resolutions. 
  2. A bank statement accurate month to month, quarter to quarter, or year to year financial snapshot based on cash flow and profit and loss.
  3. Sexy listings to reduce to vacancies and get prospective tenants amped about renting a unit.

These core features are of course supported by other useful tools, but this made up the essence at the beginning. The reason we chose these cornerstones was because collectively, we knew what going to a board hearing was like without a detailed account of events. We knew how much of a pain in the ass it was to to do a year end with a shoebox full of receipts. We also just knew that landlords needed something to make available units for rent more attractive. We felt these were the most sore pain points.

So here it is – two year old hand drawn wire frames that sketched out what we saw as a simple solution for landlords and property managers – conceived on the table of a Kitsilano coffee bar, between 3 guys who couldn’t stand the variety of perplexing property management softwares that required you to have a masters degree in computer science. Managing income property is already complicated. In our minds, if you’re going to use something, you should want to use it and recognize it’s value.

The software is now actively tracking more than $85 million dollars worth of real estate and almost 2 million bucks worth of monthly expenses and monthly rental revenue. We’ve earned a healthy clip of paying customers so far and we’re getting ready to push out an updated version of the software in the next month.

Are we the biggest or the best property management solution for everyone? No. We’re a flavour in a Baskin Robbins ice cream shop full of other alternatives. We just happen to be simpler and less expensive than most of them. There’s nothing wrong with being the chocolate against the strawberry cheesecakes and caramel tiger tail swirls of the world. We’re landlords. We’ll take a scoop of simplicity.

Do You Have What It Takes To Be A Landlord?

The Globe and Mail published this great piece a few days ago entitled, “Do You Have What It Takes To Be A Landlord?”. It offers a sober look at the pros of being a landlord and the benefits of income property ownership. It’s a great counter piece to all of the discouraging things you might hear from people who’ve tried it and had it not work out. If you’re reading this, you know property ownership and property management are hard. This piece is refreshing because it paints an accurate picture of the situation with rental property ownership. In short – it’s a marathon, not a race.

Read the piece here: http://www.theglobeandmail.com/globe-investor/personal-finance/mortgages/home-buying/do-you-have-what-it-takes-to-be-a-landlord/article11636234/

Introducing Rent Receipts

Dear landlords,

We rolled out a cool new feature for our active trials and current customers. It’s a rent receipts feature in Renting Well, that makes supplying receipts for rent received from tenants a *snap*.

As you may know, come income tax time, you may get a lot of requests from tenant for receipts. You’re obligated to provide a receipt if a tenant asks for one. All that to say, adding this feature was something we were keen on getting to post launch, and is part of a series of additions we’re going to be moving forward with over the next few months.

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Firing off a rent receipt is dead simple. Next to each revenue item marked “rent”, you’ll notice a small button labelled “receipt”. Click that – and it’ll give you two options to either email the receipt directly to the tenant associated with the rent payment, or to print the rent receipt if you wish.

Questions? Comments? Share with us. We’d love to hear your feedback.

To-do Lists Have Been Pushed Live! Welcome to v1.2

Dear landlords,

We’ve pushed out a new update (v1.2 for those keeping score) of Renting Well this morning.  First thing you’ll notice is that your dashboards look a little different: we’ve added a new to-do list to the app! This is going to make it a lot easier to stay on top of what you need to get done and ensuring you’re reminded when tasks are due.

Landlord Software in CanadaIt can be anything: tenant asks you to fix a screen? Add it as a to-do! Tenant mentions that one of the outlets in their unit isn’t working? Add it as a to do! Want to remind yourself 60 days in advance that a tenant’s lease is going to expire? Add it as a to-do! The to-do list is a handy feature that includes convenient email notifications that get sent to you on the specified due date. The main purpose is to keep you on top of the many landlord duties that need your attention — whatever they are.

You’ll also notice that the app looks a little different, too. We’ve passed over things with a bit of a fine-toothed comb: redesigned contact lists, improved layouts of financials, better icons,  and a whole whack of aesthetic tweaks all designed to make the app easier and more enjoyable to use.

Kick the tires and let us know what you think!

Why Tenant Screening Is Wickedly Important

Mistake #1 for landlords: renting on a hunch. It’s insane.

When we built Renting Well, we made it a quick priority to include access to background checking within the app. To make this happen we were fortunate to partner with BackCheck, Canada’s leading background checking service. One of the reasons we did this was because basic credit checks are just one piece of the pie. It’s good to have access to other background checking elements like employment verifications and a criminal background check. I had the opportunity recently to sit down with Iain Murray at BackCheck to discuss some interesting stats when it comes to landlords “checking” who they’re renting to:

  • 10% of Canadians have a criminal record. That’s over 3 million people. 
  • 28.5% of tenant applicants will have poor credit.
  • 12.1% of tenant applicants will lie about their employment.
  • Almost 25% of landlords would not recommend a former tenant to another landlord.
  • About 45% of BackCheck’s small landlord customers will request a criminal background check.

Conducting criminal background checks is more important than landlords might realize — an individual with a criminal history, who continues living a life of lawful offense, can have a great impact on a building and even an entire community. While a check is not exclusionary, it has the potential of reducing the number of thieves and violent ex-criminals who wish to neighbour among other tenants.

With that said, a criminal check can uncover any one of a number of offenses — not just violent crimes. People get charged with minor offenses like fraud and theft — things which most landlords would want to know before making a decision to rent to a tenant or not. There is no such thing as too much information for a landlord. Any kind of criminal background is something you should be aware of. Landlords have the right to refuse to a tenant because of their criminal history and ultimately the responsibility lies with you when it comes to introducing new tenants into your property. Check out this great info sheet published by Crime Prevention Ottawa in September 2009 that discusses how landlords can avoid and overcome the challenges of crime and disorder (such as drug dealing) on their property.

Professional Tenants Create Pain For Landlords

Professional tenants aren’t a myth. The exist for real, and they’re creating major pains for small landlords all over Canada. Came across this interesting piece at CBC news today concerning small landlords getting burned in British Columbia. A few first time landlord missteps being counted on, and an intimate knowledge of the loopholes with the B.C. LTB’s process allows for free living arrangements for a long stretch on end for pros who know how to work the system.

The Federation of Rental Housing Owners of Ontario went on record stating that professional tenants can work up to 6 months of living for free on a landlord’s dime by simply exercising their right to appeals. “We’re probably dealing with anywhere between one and two per cent of the tenant population that is doing this [scam],” said the federation’s Vince Brescia. “The activity of the ‘pros’ is creeping up … it’s a growing phenomenon.”

Property management is about due diligence. Landlords should always ask for a certified check for first and last month’s rent – something clearable prior to the tenant moving in or handing over the keys. They should also be diligent about not only credit checks and other tenant screening, but with references from previous landlords. What do you think? Do you think provincial legislations in Canada are in need of tweaking?

Oh No! I Have A Marijuana Grow-Op In My Rental Property!

I don’t really, but what better way to get your attention?

As landlords, most of us have heard of that old urban myth. You know the one… a guy who knows a guy, who’s a landlord, who suddenly finds out that the perfectly nice couple who had been renting out the house were in fact running a marijuana grow-op. There are variations on the story as well, sometimes it’s a crack house, sometimes it’s a meth lab. This story — in all it’s incantations — has popped into our brains in some way, shape, or form at some point in time.

This is the reality…

The RCMP estimate that there are about 50,000 grow-ops in Canada. They’re in single family homes, basement apartments, and even in Toronto high rise condos. Most landlords are probably oblivious to this fact — and even more alarmingly — they’re often oblivious to the massive insurance pickle they’ll find themselves in if they end up renting to someone who decides to make their unit a reefer lab.

Read this great article by Ottawa lawyer Howard Yegendorf. Landlords need to be aware that the majority of liability insurance policies have a specific exclusion for damage caused by your tenant’s marijuana grow-op. That’s just the insurance problem. There’s also the criminal enterprise element. Seriously. Have you seen Oliver Stone’s Savages? Property management is hard enough. Having something comparable to a Breaking Bad season in real life is the absolute last thing you or any other tenants in the property need.

So what do you do? Well, here are some tips:

  • Perform tenant screenings. There’s a variety of other background checks your can perform as well, such as a criminal record check and an employment verification.
  • Have an airtight lease that clearly articulates the expectation of no criminal activity on the premises and that the tenant will provide reasonable access to the landlord.
  • Visit and inspect your property regularly. Remember – landlords are allowed to visit their units for routine inspections with proper notice given. You’d be surprised how many don’t do this. Get into this habit.
  • Talk to your tenants. Communicate with them. That’s always a good way to get a sense of what’s going on at the property. If you’re hearing about a lot of suspicious people coming and going constantly that could be a tip worth keeping in the front of your mind. Grow-ops have a tendency to have a lot of runners coming in and out of the place.

Here’s some tips on what to look out for:

  • Look out for any hydro alteration or electrical bypass. Things like holes in the foundation that weren’t there before should be treated as suspicious.
  • Did the renter spend a lot of time viewing the breaker-boxes, wiring and plumbing fixtures? Were they asking a lot of questions about power distribution in the property? Believe it or not, this happens. More often than not, illegal growers attempt to steal hydro by altering how it comes into the unit.
  • Be weary if tenants want to pay their rent in cash. Seriously. Who pays in cash? People who deal with a lot of cash, like servers, even have bank accounts.
  • If a tenant discloses that they plan to have the utilities registered under a different name, that’s weird.
  • Evasive answers and vague information on a rental application. This should set off a flag anyways.
  • Condensation or darkened windows in the unit. Cardboard and blacked out windows foster an effective grow environment. That’s not normal.
  • Tenant unloads copper and/or PVC pipe, soil, halogen lamps, large amounts of black plastic aluminum ducting, and fans.

Have you ever had a marijuana grow-op in one of your rental properties? Know anyone who has? Share your thoughts with us.

The Stripper With Dirty Feet: A Tenant From Hell Story

Came across this great post by Mike Holman at Money Smarts.

The story is by Rachelle Berube over at Landlord Rescue – who runs a wicked blog that’s both funny and highly informative. Anyone making rental property management humorous deserves a Pulitzer in my books. There’s a bunch of other gems here too – like the Ultimate Guide To Giving Your Tenant Proper Legal Notice To Leave Once Your Property Is Sold or this hilarious post about renting to friends and family.

Property Investment Project U.K.

Came across this gem of a find, in Property Investment Project. It’s a website/blog dedicated to all of the ups and downs associated with buying, renting (letting as they call it in the U.K.), and managing income real estate. Besides being one of the most informative resources I’ve come across, this is one of the funniest takes on being a landlord I’ve ever found. Seriously. Whether you’re in the U.S., Canada, or the U.K. – there’s stuff to be gleaned here that you can find useful, regardless of the country you’re in.

The website has a comprehensive list of everything you’re going to want to know if you’re a landlord in the U.K. Everything. Their landlord F.A.Q. is an gleefully exhaustive list of topics and frequently asked questions. The landlord guide is chock full of seriously valuable “how-to’s” on a wide range of things, like finding tenants, pets, and even evicting tenants.

The blog is what sold me on reading this all night last. I literally read the entries for a couple of hours. It’s the equivalent of a George Carlin stand up routine, and really puts a human face on the job of being a landlord. I touched on this in the kick off piece we posted on the blog back on December 11th. Being a landlord isn’t easy – really – it’s not.

I really feel that the misconception about being a landlord needs to change, regardless of what country you’re in, and it’s something we’re trying to do with Renting Well. For every assumption that landlords are rich, there’s a slick marketing campaign advertising “how to get rich in real estate”, with a couple on a beachfront somewhere, clearly retired from all of the multi families and duplexes they bought, who assure you that it’s easy to do it to through their beaming whitened smiles. This kind of drives me bananas. I snicker a bit when I watch a lot of these home improvement shows too. As much as I genuinely love them, sometimes I find they present having tenants in a bit of an inaccurate light. Yes, you can invest 50,000 bucks into having a basement ensuite that looks like it jumped out of a catalogue, and yes, you can have your tenants cover your mortgage ( or a large portion of it) – but there’s a whole lot more to it than that. There’s the job. The landlord job. It gives the goods – warts and all. Definitely worth a read – but to be taken with a grain of salt.