In the Pacific North West the economy is booming, real estate prices are higher than they have been in several years and the rental market rates are at an all time high. This bodes very well for investors and rental property owners in the Everett, WA area. As saavy rental property owners are aware, reducing your liability as a property owner is key to being a successful landlord. In the following short blog I am going to include a couple of tips that will prove valuable on your path to reduce your liability and lead to landlord success.
Landlord Success Tip #1 – Always Screen Tenants
Always use a credible screening agency and screen every prospect over the age of 18. Our #1 client is a do-it yourself landlord who did not perform a proper screening of a tenant. These landlords contact us to help them out of a huge problem that has cost them thousands of dollars in unpaid rents and tenant damages. Be sure the tenant screening includes a credit check, criminal history check and eviction history check. Also, be sure the verify previous landlord references and current employment. Making the decision to rent to a prospective tenant based off of a good feeling about them or to help them out because they have the most heartfelt story you have ever heard is always a terrible idea and should be avoided at all costs. I say this because it will cost you if you do rent based on those qualifications. Both Experian and Transunion have very credible tenant screening solutions.
Landlord Success Tip #2 – Always Require Renters Insurance
We require our tenants to have a $100,000 Minimum Liability Renters Insurance Policy. Let me tell you a short story about why we implemented this requirement. Not to long ago, a tenant was cooking something on their stove, went into the other room for a few minutes and returned to the entire kitchen burning in flames. What had happened is there was over 13 years of grease built up on the stove and over the range fan so it caught fire when the stove burner coil was heated. The fire department was very quick to respond. They were able to put the fire out while it was still contained in the kitchen. The total damage bill came to over $45,000 and included $20,000 in smoke treatments alone. These tenants did not have any renter’s insurance and were responsible for the entire bill of $45000. Could you imagine trying to collect that amount of money from your tenant? Believe me it wasn’t a very successful endeavor. If the tenants can’t pay the bill, the Landlord is responsible. Fortunately, the property owners landlord insurance covered the majority of the bill and the tenant only had to pay the $5000 deductable. Had the tenant been properly insured, their liability insurance would have covered the entire expense. Save yourself a-lot of time, money and headache, require renter liability insurance. Prices for renter’s insurance can cost a mere $9-$15 per month. Your tenant’s current auto insurance provider most likely can offer renter’s insurance coverage to your tenants. All you need to do is ask for proof of active renters insurance prior to the tenant moving in.
Please contact us at RPMSOUND.COM if you would like to find out more information.