Topic: Special Requests from Residents

I am finding it difficult to give a good answer to residents asking us to re-paint their apartments. I fear the "No" answer will have a huge impact on whether they renew their lease at the end of their term.

I have had 2 requests in the past month for us to re-paint apartments. We don't have a policy in place for this type of request. I need to have one ASAP.

We permit accent walls to be painted with written permission and my approval of the shade.

It's not the condition of the their paint, it's the color. We started using a Sherwin-Williams designer color on vacants about a year ago. They love it and want theirs painted, too. One has lived in their apartment 1.5 years, the other almost 3 years.

I have 47 units and can't afford this. Can't afford to buy them the paint, either. I really don't want to tell them the truth. We are getting $60 more per month for those apartments painted with the new color. Don't want to tell them that, either. They might think their rent is going up that much (we are raising rent $18 per month this year).

I have been told it is an industry standard not to re-paint unless a resident has lived in the apartment over 5 years. Plus, there is the "Fair Housing" card we have been discussing. I believe if I agree to one request, I'll have to agree to all. On a small property, word gets around!

I just had another request, but they said they would pay to do it. He wants to put new vinyl in the bathroom floor and paint the walls a lighter color. He was grateful I allowed him to do that.

Can anyone help me with a good response that will keep us both happy, or at least give the resident a good understanding why we are saying "No," without revealing we have a very, very tight budget?

Hi, Sandy! I believe very strongly in this topic. Rejuvenating tired, underperforming properties is what I love doing and developing decorating strategies is one way I achieve it. However, I do not think your property is underperforming, so let us look at it as one issue of resident retention.

Obviously, with 47 units, you must evaluate everything regarding cost, etc. Many companies develop with their vendors, Sherwin Williams, being a leading one, a select color pallette from which residents may choose for Accent Walls, etc. I do not personally limit color choices in my community although a couple of property owners I work with are adamant about limiting this. I do not know what true difference it makes as Residents are required to have a quart for touch-up painting.

The general rule of thumb that I pass along to all residents is that an apartment should not require a full paint EVERY YEAR, meaning those who stay one year or less should not expect us to have to fully repaint their unit upon move out.

I suggest that you decide what color you are painting all vacant units (which you have.) Then decide what your Painting Policy is going to be (which you sort of have.) Then you decide how to roll out your new plan (which you will be doing.) The easiest way is to make an Announcement letting everyone know how excited you are about being able to offer customized decor in your community. Residents can now have this custom color added to their apartments at renewal time!!! You now have the chance to roll this out with all renewals as your Renewal Strategy. So, you will need to develop a budget for this (which is now too late for 2012, but not too late for 2013.)

The plan might be something like this:
Those who are renewing may opt NOT to have their unit repainted and their renewal rate will be $18 increase. OR: they may opt to have their unit "updated" with a custom color package that raises their renewal rate a mere $35 (or whatever you choose that will help offset the cost. Keep in mind though that next year's renewal will not include the repaint cost.) Add new tile, and their total renewal will be $50.

Another Package Option might include the installation of a ceiling fan in the master bedroom. Ceiling fans are inexpensive and you may raise the rent another $5 which covers the total cost of the ceiling fan in less than a year. Or, you may consider offering carpet cleaning.

The point is to develop the policy now since there is obvious interest. You simply tell Residents that have choices come renewal time. I have had Maintenance push back some on this at some harried properties due to sheer volume of work orders, etc. and they felt they did not have time to complete occupied paints when also trying to do turns. I am sensitive to this. That is when I will bring in a painter to help with turns and put one tech on occupieds, just so people are not pulled in too many directions. I also tell everyone, maintenance and residents alike, that scheduling is at discretion of man power, managemet, and budgetary concerns and although based on the needs to resident as well, we will schedule a mutually beneficial time to complete the work.

I do not feel a resident should have to beg to make his apartment more esthetically pleasing. However, I feel Management should reserve the right to keep control of the quality of materials, etc. and allow choices from the pre-approved list. Otherwise you may have vast differences on your property. You don't want to walk into a unit and find someone put in carpet tiles or some really hideous color that you can never re-rent the unit with (you get the idea.)

If you upcharge on renewals, you should be able to offset the extra costs. I have found that many residents would like to participate but once they realize they have to move the furniture away from walls, pack up breakables, and endure the paint smell for a few days, they don't want to do it, at least not after only a year. With 47 units, your company should evaluated this policy. If your competitors already paint walls, then you need to do this to compete. People do move based on what other communities offer in terms of personalization of units. And when you get a vacant, you will be painting the new color, right?

I think there may be a couple of options to explore and for sure you want to get an official line out on the painting situation. Repaint at contract renewal, but ensure that the tenants must move their furniture at least 4-6' away from the walls. Now the moving their own furniture ensures that there is no problem when the painters come in and can paint. Once they are done then the tenants can move their furniture back.

If painting is requested before hand, then have a prorated amount they must pay, so the ball is in their court. The repainting for free could be based upon a new lease. If you have in-house personnel you can maybe get it done cheaper. If you have a contractor, maybe you can arrange a special discount.

Another method with the prorating is if you have your places on a 5 year cycle, then take the amount that it costs to paint the whole place, and divide by 60. So let’s say it cost $1000 to paint the whole apartment divided by 60. So that is a cost of 16.66 a month. They have lived there for three years. Then that means they would have to pay around $399.84 because they want the paint before the 5 years. So you are not telling them know, just what it will cost before the 5 years and that after 5 years they get a free paint. You have not said no. Now there are those who cannot pay all upfront, so you can say you can do installments and once it is done then the painting will be done.

Just brain storming here and hope that it gave you some ideas.

I would look at it like this:

Is the resident a long term resident? If so, how long have they been there and when was the last time you painted or put new flooring in their unit? How close are they to their next renewal?

At their next renewal, offer them their choice of new paint, or new flooring (with their help; outline what needs to be done by them to make it as easy as possible). BUT, make sure you get a rent increase at least 50% of the difference between what they are currently paying and what the current market rent is.

Say the resident is paying $1000 in rent, and the current market is $1200 and the resident has been there for 3 years and the carpet and paint were not new when they moved in (hoping you have records of this).

Give the resident the choice of new paint (choice of color within reason), and a rent increase to $1100; OR new flooring, with a rent increase to $1150 (since the flooring is more expensive to do). You will recover the cost of the upgrade quickly and would likely be doing both anyway if the resident leaves PLUS you will have a loss to a vacancy to report and the costs incurred in turning over and marketing a vacant unit until it is occupied; which can cost as much as 7 TIMES as what it would cost to keep that resident happy. At the NEXT renewal, offer to do the upgrade not done with a similar rent increase.

Sandy, could you share with us a specific example of resident with a renewal that has requested either of these upgrades and how much these cost you to do? Include your current market rent and what this resident is currently paying and I will be glad to run the numbers to show you what I am talking about. The example I mentioned is not complete and was pulled 'out of the air'. Make sure you include information as to how long the resident has been there and when you did these things last to the unit.

The unit was painted December, 2011, when she moved in.

She moved in while we were in "receivership" for a rate of $535.

She currently pays $565. She will be up for renewal at $583 in December.

I am renting like units now for $619, which is $24 OVER the market rate (guess I need to increase the market rates).

It costs $175 for wall, trim and cabinet paint for the entire apartment.

$450 for painter, more for painting ceilings

She lived alone until 2 months ago when she got married and her husband moved in.

The apartment is immaculate with little furnishings in it.

My biggest obstacle is the owner. We have been out of receivership for a year. They have lost a lot of money since they bought it in 2008. We have a lot of work that needs to be done to the buildings. The property is 30 years old and the buildings are modular.

I am currently offering a Renewal menu for "early bird" renewals (45 days instead of 30). The most expensive item is carpet cleaning for $60, which everyone is choosing.

The owner is not going to go for painting someone's apartment who has lived there for 1.5 years and has the lowest rent rate on the property. They are very conservative and have been really burned financially on this property. It's the only one they own.

I'm at 100% pre-leased and 98% occupancy. Our market is very strong and I have managed to increase rates. I just rented a corner unit for $625.

Everyone else is allowing accent walls and the residents to paint any color they want, from what prospects have told me. We allow accent walls painted any shade at or lighter than the color we have on the walls using the Sherwin Williams color chart.

It may be time to allow residents to paint whatever they want to. We increased our qualifying criteria last August to get a better quality tenant who, we hope, we won't have to evict after 3 months.

Below is what she wrote me in her e-mail:

"Residents are not able to request that their homes be repainted? Why do we have to buy the paint as well? If you guys have the paint is it not possible that they supply us with it if maintenance is not our responsibility? Our walls need repainted anyway because of fading. If this is something thats out of your control please direct me to the person I need to talk to. If we need to compromise such as we will paint and you guys supply the paint that seems fair, although I dont think this shouldnt be our responsibility. Hope it doesnt seem Im being difficult just inquisitive. "

I'm taking the owner to look at it Thursday when he comes down for a visit. He's going to ask me "What does everyone else do?"

First thing; if the resident has only been there a year; I would not do any upgrades at my expense PERIOD. Especially if the paint and carpet were new at the time of move in. If the resident wants to do it themselves or pay someone to do it, I would ask for final approval of the color(s). I have no problem with that. I would give the resident in this case the contact information for my paint supplier and ask that they give the resident my price for paint, as opposed to what they might pay if they walked in their door.

Now, if the resident has only been there a year and the paint (or flooring) was >3 years old (or is past the 3 year residency mark); here is what I would do: (for sake of making the math easier, I have rounded up)

Current rent: $565
New resident rent: $620

The difference between the current rent and the new resident rent is $55

Resident wanting new paint is offered this, but must agree to a rent increase to $600. This is a $35 increase. At a cost to paint a unit of $625 (materials and labor), this will take 18 months to recover the costs. If this can be done in house (with a part time maintenance person), then we can use a lower amount. For convenience, let's use $350 as a cost for materials and labor for in house work. In this case, it will take 10 months to recover.

You did not include the costs for those wanting new carpet and how much it costs you to turn and market a vacant unit. I have no idea what it would cost you to lose a resident and find a new one.

As far as keeping paint on hand; I would tell residents I keep a small quantity on hand to do touch up work only and not enough to do a whole unit. When I have to do a whole unit, I order just enough paint to do the units I need to when I need to. This ensures the quality of work and keeps the finished product looking like a 3rd grader did it. It is a safety and storage issue to keep more paint on hand than needed. Plus paint does solidify inside containers that have been opened after it goes unused for a period of time. I know this from when my dad and I used to use car paints for our model airplanes. At any given time, we had a dozen partially used quart or gallon sized cans of solidified paint that would now be considered household hazardous waste, requiring special handling to dispose of.

If you adopt this policy and apply it consistently, you should be able to stay out of fair housing hot water.

Now, if the unit needs to be repainted due to an unforeseen repair issue that required demolition to resolve; then this is your responsibility.

Our company allows residents to paint any color they choose. We have an addendum that states they can either paint a shade light enough for one coat of paint to cover, or they must prime the unit at move out (or pay the cost for us to do it).
If a unit has been painted by us we do offer touch-up paint for them to use.
I can only ever remember having 3-4 units in my career that were painted while occupied. When I tell residents they have to move all the furniture out of the room being painted they usually back off :)
I agree with what everyone else has said though regarding the cost of turning a unit vs. the cost of painting.

Something I found odd about paint and painting was when my wife and I took over the property in 2002. Prior to our moving into the "resident manager's apartment", I did a full paint on the unit. I had the carpet cleaned after that.
The "odd" thing is that when we retired and moved out of the apartment eight years later in 2010, the only thing needed was filling curtain rod holes and touching those up. So here you can equate 1- paint job@ 8 years. What amazed me in my apartment management career is the number of times I have had to paint "tenant" units equating to as much as once every move out. Maybe my wife and I don't put the soles of our shoes on the walls?
We ran a USDA Rural Development property. RD said paint them every three (3) years, and our management company said the same thing. We have one lady who has lived in the same unit since it's opening in November of 1998, and I promise you that you could stand on the front porch on her move out and take the keys from her, and hand them to the new tenant without doing squat to the unit!!!
So what is the life of the paint jobs? Also, I got to noticing in my own home, that our dining room was painted white in October of 1996. Nope, don't need painting today which is 29 May 2012. Guess we have squeezed a lot out of that paint job, huh?
Neither does our kitchen, den, or hall. Hummmm? I must be buying a better grade of paint than most people can get (Tenants)??

Oh, I forgot, those are "just rentals" aren't they? That explains it.

Did you receive closure to this question or still open for suggestions?

We made the decision not to have a written policy about re-painting. We will take each request into consideration on a case-by-case basis.

I inspected the tenant's apartment and found it to be in normal condition for an apartment that has been occupied for 1.5 years. I did not see any fading or any particular need to re-paint.

We decided to offer the resident the following choice:

1. Sign a new lease that will begin at the end of the current lease term (December) for one more year at the rate increase proposed for this year's renewals.
2. We will purchase 5 gallons of paint for her to paint.
3. We will also purchase 1 gallon of white trim paint
4. Add another coat of white paint to the kitchen cabinets (needs it).

This will cost approximately $140.00 plus maintenance hours.

I doubt this will be the last request she makes.

If the unit truly needed any kind of paint, I would question the quality of the work; or what the resident doing to it....

I mean, really???