Frugal Coconut said...
Does Mr. Sam do the painting and cleanup himself or do you outsource those jobs?
I just had to do those as well as I'm also in the process of re-renting ... and it just seems as though it would eat into any potential profits, especially if the tenant hasn't been there that long.
I don't know what the fine line is for paint being a wear-and-tear item for which you can/cannot charge the tenant. My previous tenant put holes in the walls despite the rental agreement prohibiting it. Luckily I had to repaint anyway because it was time ... but what if it wasn't? And what is a typical lifeline of paint so that I would know whether the tenant got it dirty/blemished prematurely or if I just have to suck it up and fork over the cash to have it repainted at turnover?
How do you handle things like that? What is worth the hassle of deducting from the security deposit, and the risk that it will be disputed in court?
I have a property management firm take care of mine, I have no direct contact with the tenants. They seem to get higher rent than I think I could (so that offsets some of the cost). We agree on the rent and they have discretion for up to $100 for repairs then need my approval. Over 9 years they have done a great job screening tenants and my current tenant has been there 5 years. They also seem to get volume discounts for us (like painting) since they manage a few hundred homes. 10% of the top of the rent for all the above.
First, when it comes to turning our rental properties, Mr. Sam does almost all the work himself (although he often has a guy who works with him or who works at the property when Mr. Sam is at work). At this point in the game, Mr. Sam has all the supplies, equipment, know-how, etc. to do just about all the rental maintenance that is necessary. We also, minimize costs by using the same paint colors for the exterior of our rental homes (and our primary home), same paint color for the interior of our rental homes, and we utilize the same carpeting from rental home to rental home.
Second, when it comes to paint, we don't count that as a charge against the security deposit, because we almost always paint each time a rental turns (most of our rentals are more than a year), we count it more as cleaning. Security deposit goes to actual damage. We also try to take a non-refundable pet deposit as part of our security deposit. And since its non refundable there is no discussion as to what we are charging for.
Third, we've never used a property management service so I can't really speak to same. For us the costs, which seem much higher than what Anonymous reports, are just not worth it. All of our properties are within 10 miles of our home, we have lawn service for one, but otherwise we (meaning Mr. Sam) can manage them with one Saturday of work per month when they are rented.