For several months I have been in conversations with a new client about their investment property. It is a complicated situation. They've been unhappy with their renters and their property management company for a while, and want a clean slate.
One day they called the office when I happened to be answering the office telephones. I said that we are a full service brokerage, that I can list their property for rent and that my brokerage has a property management team. But, first they have to get a copy of their property management agreement to see when their contract ends, if there is a way if they want to end the relationship before the contract comes up for renewal.
It took a while for them to connect with their property manager, mostly because the homeowners were uncomfortable telling the property manager of their plans. The owners have continued to work with the tenants, giving them time to find a new place, which has been a challenge for the tenants.
Yesterday the renters told the owners that they (the renters) could probably be out of the house by the end of September. On the one hand, the owners felt a sense of relief as there is now an end in sight and they could soon start fresh with new renters. On the other hand, the owners are nervous that they've missed the market for renting, spring an summer months, and that if listed now, as we enter the the fall-winter months, that we wouldn't get a new tenant and they wouldn't be generating any rental income.
They asked me if it would be better for them to just extend their lease with the renters through the spring, when the 'high rent' season begins?
The average person would probably tell them that nobody (figuratively) rents homes during the fall or winter, so deal with the tenants for a few more months before starting fresh in the spring. Before giving the owners an answer, I looked at their local market trends in the fall-winter months, going back 3 years and compared it to the spring-summer months.
Would it surprise you that nearly as many homes rented during the fall-winter months as did during the spring-summer months and they commanded the same rent (On average 75 homes rented during the winter months while 81 rented during the spring-summer period)? On average it took on or about about a month for homes listed in the spring-summer to get rented, while in the fall-winter months it took close to 2 months to rent. And, similar homes rented for close to the same price during both time frames.
So, when do people move? Always. Is it a good time for these owners to start fresh with new renters or to stick with their current tenants through the spring? I told the owners that before making a decision, they need to evaluate how responsible the tenants have been in paying rent, communicated, cooperated and accepting responsibilities for home repairs---when their fault and the property condition.
After answering these questions, I told the property owners they really need to come into town (one of the challenges is that they are not local and haven't been in the home for probably 2 and a half years, being hands off, completely relying on whatever their former property manager told them about the home), meet me at the house, see how well (or poorly) the current renters are taking care of the house and decide whether they are in a good, manageable situation with their tenants, or if it is time to move on. I strongly sense that there is a fear of change and missing the market, but we have answered those issues.
Hopefully, after analyzing the situation, the owners are happy, or at least satisfied, with their current situation and can continue to generate rental income with the current tenants instead of having to go through a tenant turnover and missing a month or two of rental income. But, if the tenants have not been diligent in paying rent and caring for the property, I hope the owners will tell the tenants to leave as it could prove to be more costly in the long run to keep irresponsible tenants than going a short term without rental income while making home repairs and finding new renters. Whatever the owners decide, I am here whenever they are ready. And, in the meantime, the can retain a new property manager to take care of their home.
Whenever someone you know is thinking of buying, selling or renting a new home, or is considering purchasing an investment property, please pass my contact information to them and I pledge to take wonderful care of them. I'm a full service agent, licensed in MD & Washington, DC.
Life is good!
O: (301)469-4700 - ask for Adam
Long & Foster Real Estate, Inc.
Licensed in MD & DC
information deemed to be accurate, but not guaranteed.