Rental Lease Agreement

A guest post by Ashley Halligan, Analyst, Property Management Software Guide

Short-term rentals, of all natures, have become a hot commodity – and a controversial one at that. Short-term rentals can include vacation rentals and temporary housing, often sought by vacationers, business travelers, or people who have recently relocated while seeking long-term living arrangements. Either way, it’s become an ongoing topic of debate and an attractive investment opportunity for property owners and managers. In comparison to traditional rentals, short-term rentals can charge significantly higher rates given their nightly and weekly availabilities. Some property owners have earned as much as 25% of their mortgage in a single night. And during special events or peak rental periods in a given area, potential rental rates can be very attractive to property owners. Because of the income short-term rentals can procure, the opportunity for profit potential may be exponential – but there are several considerations that should be kept in mind.

First and foremost, it’s essential to keep the added costs of maintaining a short-term rental in mind. These rentals can be subject to Hotel Occupancy Taxes in certain cities, while other cities require specific licensures and inspections not required of traditional, long-term rentals. Penalties for not abiding by short-term rental laws in your city may result in hefty fines. There can also be increased insurance costs. Additionally, the cost of regular upkeep and maintenance, including utilities, should be calculated. In order to continually attract tenants, your property must be kept in prime condition, both functionally and cosmetically. From a marketing perspective, this could include offering unique amenities like sporting equipment or movie libraries, all of which are additional expenses. On the flip side, the regular maintenance of these properties has been credited with helping to increase neighboring property values.

By Jo-Anne Oliveri, ireviloution intelligence, Brisbane, Australia

Are you in a position to create your own bonus and incentive plan that strategically builds your business, not just your property manager’s pocket? Successful bonus and incentive plans are all about understanding your team at an individual level, your agency’s business plan, and your market area. So, this week, let’s take a look at how understanding these critical factors converts to a bonus and incentive plan where all parties- the team member, property owner and you, the business owner- win now and win in the long-term.

What happens if, for instance, the average weekly rent in your market area is $300 and the property manager has a target of five new managements per month? The property manager could in fact reach the target of five new managements, but the five properties average only $200 per week. The problem – the property manager’s focus is on numbers and not quality.

By Salvatore Friscia, San Diego Premier Property Management, San Diego, CA

You don’t have to be a homeowner to have heard the term “short sale”. It’s one of the most widely used terms in the real estate industry these days, and unfortunately, it’s also a term that many renters are starting to hear more of as well. The prolonged economic downturn that engulfed the real estate industry, starting with the subprime loan debacle, which rapidly resulted in mass foreclosures of adjustable rate home loans, has now inevitably morphed into the “short sale” frenzy of the 20% down conventional homeowner.

Unfortunately, many of the affected properties are the homes of renters who abruptly find themselves caught in between the bank and the landlord’s hardships. The typical scenario is as follows: An owner/landlord carrying an upside-down mortgage on a rental property finds himself under financial distress due to the economy. The landlord tries to hold onto the property for as long as he can only to realize that it’s either too far underwater or the loan modification offered by the bank isn’t going to reduce the monthly mortgage payment enough to help him through his current financial situation. At this point, it’s either foreclosure or short sale, and currently, most banks are starting to favor short sales. Either way, the unaware tenant is typically left with minimal notice to relocate.

The city of San Diego has always had a strong military presence, and here at www.SDPManagement.com we are very thankful for the men and women of the armed forces who brave their lives each and every day to protect our country and freedoms. The military is a strong and considerable part of our local economy and we take pride in marketing our rental properties to active and retired military personnel. In doing so we also understand that “Service Members” of the military and their dependents are provided further protections under Federal law regarding tenancy rights.

Under Federal law, a “Service Member” is classified as:

• A member of the Army, Navy, Air Force, Marine Corps, or Coast Guard on active duty;  or
• A member of the National Guard under a call to active service authorized by the President or the Secretary of Defense for a period of more than 30 consecutive days under section 502(f) of title 32, United States Code, to respond to a national emergency declared by the President and supported by Federal funds; or
• A member of the commissioned corps of the Public Health Service on active service; or commissioned members of the National Oceanic and Atmospheric Administration on active service;

The Federal Service Members Civil Relief Act is one of the protections afforded to service members. It applies to any service member who is on active duty or active service; or during any period when the service member is absent from duty because of sickness, wounds, leave, or other lawful cause. It allows service members to terminate lease agreements under certain situations without recourse from the landlord. There are a few situations that allow for this, most notable would be if the tenant is in the military when the lease is signed and then after the lease is signed the tenant receives “military orders” for a permanent change of station or, if he or she receives “military orders” to deploy for at least 90 days. In this case the tenant must provide written notice of termination, and the new termination date must be at least 30 days after the first date on which the next rental payment is due. (For example, if Resident served the notice on September 15th, Resident’s tenancy would terminate on October 30.) Resident must provide owner with proof to establish that Resident qualifies for this limited exception. Proof may consist of any official military orders, or any notification, certification, or verification from the service member’s commanding officer, regarding the service member’s current or future military duty status. Military permission for base housing does not constitute a permanent change-of-station order.