By Steve Boudreault, Buildium, Boston, MA

Well here we are in a brand-new year, and if you’re a property manager, you’ve no doubt drawn up your plan for keeping your residents and keeping them happy in 2013. Many property managers follow a fairly standard playbook when it comes to resident perks — Super Bowl parties, free coffee in the mornings, discounts on multi-year leases, and so forth. But here’s something to consider: SatisFacts, the apartment industry’s authority on resident satisfaction and retention, discovered that the top three factors that influence a renewal decision are quality of maintenance service, safety and security, and quality of customer service provided by office staff. But what about the free peppermint candy in the leasing office? Nope. Not gonna cut it.

So how can you use these three factors to your advantage? Let’s take a look.

The quality of maintenance service is a no-brainer. It can be a challenge for larger properties, but maintenance staff showing up quickly with the most likely tools they’ll need for the issue can go a long way. And though many properties have switched to an online maintenance request system, most service requests still come via phone or in-person leasing office visit, so having staff on hand who are familiar with the most common issues and how to resolve them can be a real feather in your cap. Never having to worry about the malfunctioning garbage disposal? Who wouldn’t want to renew?

It’s no surprise that safety and security are a high priority for residents. Why would anyone want to stay somewhere they didn’t feel safe? Taking proactive steps to ensure a well-lit property filled with well-informed residents is key. Make sure that you have a good rapport with the local law enforcement. Replace burnt-out light fixtures in exterior common areas quickly. Inform residents if there have been any incidents such as break-ins, vandalism, or strangers hanging around the property, and be sure to let them know what’s being done about it. A feeling of security? Who wouldn’t want to renew?

And finally, customer service. It doesn’t matter if you have five units or 500, it all comes down to customer service. Do you have experienced professionals in place? Folks who can endure the most expletive-laced tirades with a smile? Who can make prospective tenants feel at ease, but with just enough sales experience to convince them they should take the plunge? And the $64,000 question — do you have a customer service staff that cares? Really cares about resident concerns? If so, you’ve got the biggest piece of the puzzle already in place. A pleasant voice on the other end that makes a person feel valued and appreciated? Who wouldn’t want to renew?

So? What are you doing to keep your renewal rate high this year?

Keeping your lease agreements up to date and in compliance with federal, state, and local laws is the best way to protect yourself and your investment in your property. Here are some great resources to help you keep that lease flawless. 

• It’s very important, even as a property manager, to understand Tenant Rights and Responsibilities. Here is a breakdown of those rights and responsibilities in Massachusetts — most states have similar pages.
• Have you decided that hiring legal counsel is the way to go? You can find a real estate lawyer by state or province here.
• The National Lease Program Webinars are a great industry resource and an invaluable place to ask experts any questions that you might have regarding your lease agreements.
• Your local Building Owners and Managers Association can also be a great reference when looking for state specific lease information. Locate BOMA in your state here.

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If there’s one document in property management that simply has to reviewed (and updated as necessary) on a regular basis, it’s your lease. This  is, after all, the document that will ultimately determine your rights and protect your best interests when it comes to issues both big and small.  Because you’re dealing with a host of rules and regulations on the federal, state, and local levels, it’s imperative that you not only adjust your lease as necessary when laws change, but also that you’re in compliance and protected on all three fronts.

If you’re not proficient in legalese, chances are reviewing your lease (and, moreover, identifying those elements that need to be changed) is a daunting endeavor at best. Following are some tips and best practices for keeping your lease up-to-date and your best interests protected on an ongoing basis.

Hiring Legal Counsel
Yes, this can be a somewhat expensive option. However, consider the fact that a water-tight lease can potentially spare you legal costs of a far more unpleasant variety in the future and additionally saves you a ton of time (as compared to reviewing and revising a lease on your own). Suddenly, the cost of hiring a legal professional to review your lease becomes a far more appealing option. If you do choose to take this route and don’t already have a trusted lawyer in your contact base, talk with real estate and property management professionals for references to proven lawyers that specialize in such matters.

Professional or Association Meetings and Seminars
Taking part in professional groups and associations on both a local and national level can benefit your business in any number of ways. Particularly in the case of associations, it’s their job to keep close tabs on all of the legislative and legal issues that affect your profession. Most associations offer updates on such issues in addition to regular meetings and seminars designed specifically to guide you on issues such as leases, contracts, and other legal concerns. While professional groups in your area may or may not have meetings and seminars specific to this topic, such gatherings offer the perfect forum to exchange information on issues like this and to learn about any developments that may affect you.

Experience
Just as important as an up-to-date knowledge of laws and regulations is your own experience. Let’s say, for example, you’ve had consistent issues with tenants’ pets on your property. You currently have a pet policy in your lease, but know from hard-won experience that your life would be made easier by just disallowing them altogether. In such scenarios, take your own best advice and alter your lease to make it reflect a more manageable, optimal situation for yourself. One word of caution, though: Even in situations like this, you still want to ensure that such changes are not in violation of standing federal, state, or local laws by utilizing one of the aforementioned resources.

In the end, the most important thing is that you make a commitment to yourself to review and update your lease on a regular basis. Perhaps you want to schedule a lease review into your calendar as a recurring task the first week of every year. Whatever you do, don’t let it fall to the wayside. Always be alert to changing regulations that may affect you and potential problems that become apparent from your own experience with tenants your tenants.

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For some landlords, summertime means subletting time. And as we all know, subletting can be a tricky nut to crack. Part of being a good landlord is knowing how to carefully weigh your options and choose the scenario that has the best chance of working to your benefit in the long run. Such decisions often have to be made on a case-by-case basis, accounting for the specific tenant and situation in question. Subletting is a perfect example of precisely this sort of scenario.

First and foremost, make sure that all of your rental leases contain a sublet clause requiring your tenants to obtain permission before subletting their apartments. It is imperative that you are always aware of any subletting scenarios that may arise.

Subletting most generally occurs in cases where a tenant needs to vacate his unit before the lease is up. As always, be sure to check your state laws, but most states require that both you and the tenant in question make an attempt to find a replacement tenant for the unit. This will require you to market the property as you normally would when seeking a new tenant. If you are unsuccessful and the unit goes to sublet for the remainder of the lease term, the original tenant is responsible for any differences in rent and “reasonable” costs incurred in your attempts to re-rent the apartment (this includes disparities in monthly rent between the original and subletting tenant, advertising costs, etc.).

In most cases (but not all—again, be sure to check your state laws), the tenant who signed the original lease is responsible for his rental unit whether he’s occupying the unit or someone else is. This means that the tenant is responsible not only for ensuring that the monthly rent is paid in full and on time, but also for any damages that are incurred in the unit whether they are caused by him or someone else. With this in mind, it’s wise to maintain the original tenant’s security deposit even when a sub-letter is occupying the unit.

If your state provides you with the option to determine whether or not to allow a tenant to sublet, carefully consider the experience you’ve had with your current tenant before making a decision about whether or not to allow a sublease. Since this person is technically still responsible for the unit, you’ll want to make sure he has a proven track record of paying rent on time, taking good care of the unit, and generally behaving appropriately for his living situation. If a tenant is already unreliable while on premises, the situation may well become even worse once he has vacated the unit.

In cases where you are allowing your tenant to sublet the unit to a new tenant of his choosing, it’s wise to recommend that he base his choice on a candidate’s demonstrated record of financial responsibility and stability or lack thereof. In most states, a credit check for this purpose is permissible and, more than that, advisable. A good friend of the original tenant is not necessarily the best choice for a sub-letter.

Although subletting may not be the most desirable option, in many cases it’s better than maintaining a vacant unit. For subletting to work, however, it’s critical that all parties involved—your original tenant, the subletting tenant, and you—have a firm understanding of each party’s responsibilities and financial obligations.

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Although we usually use this space to share some of our favorite sites and blogs, this week we thought we’d mix it up a bit by letting you in on some of our favorite property management books.

• Not surprisingly Property Management Kit for Dummies (from the famous For Dummies series) is an easy read, chock full of information.
• Ken McElroy is not only the author of Rich Dad’s ABC’s of Property Management but also a “Rich Dad Advisor” for Rich Dad’s founder Robert Kiyosaki.
• American Landlord: Everything You Need to Know About Property Management gives readers more bang for their buck.  This how-to book also comes with a CD that includes rental applications and lease agreements.
• Leases & Rental Agreements shows readers how to create rental agreements in accordance with their specific state laws.
• For a great general introduction to property management, check out the aptly-named Property Management. Among other things, this book includes a run-down of all the federal laws property managers should know.

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