Be a Grinch!

We get feedback from landlords all the time who say they have trouble collecting rents in the Christmas season. Their January rent payments are spotty at best, with late payments the norm.

This can be for several different reasons, but mostly it's because of overspending this time of the year, especially by families with kids.

While we don't recommend being totally heartless, you do have to treat rent collection as a business function that is key to your survival...

If you feel it is unfair to demand rent when tenants have overspent, think of it in business  terms. You need income to survive, and for your rental business to succeed.

Can you call the bank, utilities, property tax collectors, etc. and ask to pay late because you overspent? How would that go over? Why should your tenant expect any different from you? Possibly because you have trained them to pay late...

Have you ever in the past ignored late payments? Accepted excuses for late payments? Not taken any action?

You don't have to be a complete hardass, but giving firm expectations is very important. If the 2nd rolls around and no payment has been received, we send a notice outlining the severity of the situation and the possibility of eviction. If they fail to act in the specified time (local landlord/tenant regulations vary) the eviction process is begun. Consistency is the key here.

This shows that you are professional, mean business, and late rent is unacceptable. Even with compelling excuses (when are they not compelling!) we send the notices. Sorry your cat had to have emergency surgery, but the mortgage comes out on the second, and the mean old bank don't care about any excuses!

Tenants will quickly realize it's just business. It won't  make them resent you any more. They understand they have to pay for the merchandise and won't hate the clerk who gives them their bill...      

The Grass Is Always Greener...

I get a kick out of these "experts" who recommend buying real estate far away from home, or even in another country.

Many advise buying without looking at the buildings or going to the neighborhood! They are speculators. They tell you to buy in an area that is "hot". They believe that the other lawn is always greener...

I would never buy a place sight unseen, or in a place where I would have to bring my passport to visit!

You can never really get a "feel" for a place till' you've been inside and walked around. Tasted the air. Smelled it, felt it. Pictures can hide bad layouts, excess moisture, mold, fire separation issues, life left in major systems, appliances, roof, etc., etc...

And what about the location, location, location? Ever look on Google street view and see a completely different impression when you actually stood on the street? Also, things can change very rapidly in the short amount of time since the streetview car had last been by...

Also, there is the issue of management. Are you going to trust these managers you have never met in person? How can you "check up" on them? Who are they renting to? Who are they hiring as contractors? (try and find a good one yourself, it's not that easy!)

Unless you live in the middle of the arctic circle, you can find good deals nearby. You know the idiosyncrasies of the area. You know the tenant profile. You know the reputable people to work with. You can check out your places whenever you want. Just jump in the car...

And besides, if you truly think your area is no good, why are you living there?