benefits of renting

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Rental Property Deposits

So you are out looking for your new home; you are “apartment hunting”. You are working with a great real estate associate who is showing you exactly what it is that you are looking for and you have a couple of great choices to pick from and are ready to make that much anticipated offer. Yo

Earnest Money (Deposit)

u sit down to sign the offer which your agent has prepared for you and as they explain; you are hit with the harsh reality that you will need to come up with THREE MONTH”S rent to move in. WOW, that is a lot of money for a rental. So why is it that landlord’s require so much money; I mean after all you have great rental history, great credit, your income can easily afford the rent and you have no criminal record. Shouldn’t you be able to move in with just first month’s rent and the security deposit. The reality is that the answer to this question under these circumstances is probably “YES”; you should be able to move in with just first and security, you should be rewarded for having good rental history and good credit. In most instances both landlord and tenant would agree to this arrangement. However there are other scenarios more often than not that dictate differently. I would like to discuss the main issues which would prohibit a landlord from accepted the first month and security alone.

1. Many condo boards require a common area deposit equivalent to one month’s rent, or sometimes a predetermined amount. Therefore if the owner accepts the tenant with first month and security and the condo board gets the security then the owner has no deposit for damages on their property beyond regular wear and tear; the landlord would be exposing themselves to potential loses.

2. Many condo boards have what we refer to as rental restrictions. Sometimes these restrictions can cause issues with deposits. For example; a common restriction is that a unit owner may only rent the unit once per year. Sounds great to most owners especially those that occupy their units as primary residences; “Hey, we wont have that transient atmosphere of people constantly moving in and out”. But now look at it from the point of view of an owner who is renting out their unit. “If I rent this property out to this particular tenant and they stay for only 6 months or for that matter any period of time for less than the 12 month lease; in other words if the tenant breaks the lease I am stuck with an empty apartments with no income”. The landlord still has to pay the mortgage (if any), condo maintenance fees and taxes. Therefore, the owner who has such a restriction enforced by his association will be less likely to lower the move in requirements because they would prefer to guarantee the tenants lease performance for the entire term and this way if the tenant does break the lease the landlord can at least keep two month’s rental equivalent and still have the option to seek damages for the remainder of the lease term.

3. The landlord has simply had a bad experience before and is unwilling to take the risk again. Yes, this may seem unfair, as it seems like future tenants pay for the shortfalls of past tenants but it is the reality and a business decision that the landlord ultimately has to make.

In short, although there may be other reasons for the three months move in requirements these will typically represent the main reasons.

However, I will provide a warning for tenants; watch out for those landlords in foreclosure that are just looking to keep your deposits and collect rent until they get foreclosed. So how do you protect yourself. Well, first of all ask your agent to look up any Lis Pen dens against the property, try to find out if the owner is already in default. Also, if you are looking at a two bedroom with a direct ocean view in a full amenity building and the unit has granite counter, marble throughout and a jacuzzi in the master and the owner is asking only 1300 monthly, it may just be too good to be true. Scroll down to read blog on landlord / tenant laws on foreclosure.

Miami Rent Seekers

My landlord is in foreclosure, what are my rights?

: FORECLOSURE AND WHAT IT MEANS TO A TENANT

As foreclosures have increased in recent years; tenants have found themselves to be major victims of lack of information and much frustration. We hear the same story all the time; “I have been paying my rent and now I come to find out that the landlord has been pocketing the money and not paying the mortgage and now they are in foreclosure”. Naturally, this brings up many issues and questions. First, is the landlord in breach by not paying the mortgage? Second, can the tenant break the lease? Third, what about the security deposit the tenant may have placed with the landlord or perhaps advanced rents paid to the landlord?

These are all valid concerns that a tenant may have and the reality is that the tenant is usually the least informed in such an instance. Well, it looks like finally there is some relief for tenants in this exact situation.

In the past landlord / tenant issues have been governed solely by The Florida Landlord Tenant Act ; however, recently a new law was passed to address specifically tenants in a foreclosure situation.

The Protecting Tenants at Foreclosure Act became effective on May 20, 2009. The new law has several aspects to it and although I am certainly not a lawyer by any means and am not interpreting the law I would like to point out some of the obvious aspects which may be of use to a tenant in this situation.

1. The law will require the purchaser of a foreclosed property at the actual foreclosure (this could be the bank or another party) to give a tenant a 90 day period in which to find a new property to live. This certainly alleviates a ton of pressure and the fear of getting “kicked out” of your home.

2. If the tenant has a written lease the bank that foreclosed must allow the tenant to live out the lease term and in essence become the landlord; unless the home is sold to a new buyer who actaully wishes to occupy the home as a primary residence. In which case the 90 day to vacate clause would kick in. Again, this is a nice peace of mind for the tenant.

Some practical advice for prospective tenants when looking for a property:

1. Check public records for any “Lis Pendens” or action against the property you are considering prior to signing a lease agreement.

2. Know exactly where your security deposit is being held.

3. Use a licensed real estate professional when locating your lease property.

Miami Rent Seekers

Rental Property Inventory is low…..

At Miami Rent Seekers we specialize in residential real estate in the Aventura, Sunny Isles, North Miami, Hollywood, Hallandale, Bal Harbor, Miami Beach, Brickell and Downtown Miami markets. In recent months we have noticed a significant drop in the inventory levels for available rentals. I believe this may be attributed to several factors which we are noticing in the market.

1. The market is offering excellent rental rates for properties which in the past would have rented for much more.

2. There are many people unfortunately losing their homes to foreclosure, this sector is turning to the the rental market for there housing needs. Increasing the pool of potential tenants

3. Banks are placing REO or Foreclosure properties on the market for sale but not for rent.

4. We are currently in the “snow bird” season; therefore, many owners which have rental properties in buldings which allow short term or vacation rentals will simply take advantage of the increased rental rates for a vacation rental during the season.

In essence all these factors are adding up to a decrease in available inventory.

Our advise is that if you are currently in a rental property and you do not need to move yet, but your lease is expiring, that you simply negotiate a renewal with your current landlord. If you used a real estate agent to locate the unit in the first place, you can simply contact your agent and they will be happy to take care of the negotiations for you. When one of our associates attempts to negotiate a renewal with a landlord on behalf of the tenant they will typically suggest a rate reduction when appropriate due to market conditions; pointing out aspects of the deal like; your “great payment history”, the fact that there will be no down time for rental payments (no waiting for a new tenant), the idea that the landlord will not need to paint or clean the unit for a new tenant.

If you do not need another year, landlords are sometimes apt to renew for a shorter period of time. Again, the agent you originally used should be able to assist you with this process.

If you must move we recommend you contact an agent which is familiar with your desired area and you start your apartment hunt as early as possible. We recommend 45 to 60 days prior to your lease expiration. This will provide ample time and will avoid the pressure situation of having to settle because you are in a hurry. This will also allow proper time for the application process.

In short rental rates are still great; you will get much “bang for the buck”, but your choices may be less than in the past.

Miami Rent Seekers

While there are some renters who view renting an apartment or a house as a failure, there are others who see the benefits there are to be gained from renting a property as opposed to purchasing a property. Some of the benefits of renting include the ability to save money while renting for the purpose of purchasing a home, few maintenance requirements and the inclusion of amenities which the renter would not likely be able to afford if they were to purchase a home instead of renting. Although there are some negative aspects to renting an apartment, this article will focus exclusively on the benefits of renting a property.

The Ability to Save Money

Being able to save up a great deal of money for the purpose of making a down payment on a dream home is just one of the many great advantages to renting a property. Many homeowners were able to realize their dream of homeownership only after living in a rental property for a certain amount of time. Although renting is often criticized as throwing money away because it does not result in equity, the ability to save money while renting is unparalleled

Rent for an apartment is usually considerably less expensive than the monthly mortgage on a home. The home is also typically much bigger than the rental property but in cases where the renter is renting for the sole purpose of saving money, the value of renting cannot be denied. Depending on how long the renter stays in the apartment, they may save hundreds or even thousands of dollars during the course of the rental agreement.

No Maintenance Properties

Another advantage to renting a property is there is typically little or no maintenance required by the renter. This is especially true in an apartment situation. The renter may be responsible for small items such as changing light bulbs but more extensive repairs such as leaks in plumbing or clogs in drains are typically handled by the maintenance staff of the rental property.

Additionally common areas such as grassy areas or gardens are maintained by the maintenance staff. The exception is usually when the renter rents a home as opposed to the apartment. In these cases the renter may still not be responsible for small repairs but might be obligated to take care of items such as maintaining the grass.

Worthwhile Amenities

Another advantage to apartment living is often the amenities offered to residence. Such amenities might include usage of the pool, an exercise room, meeting spaces and a theater room. In most cases these amenities are offered free of charge to resident and their guests. Many renters who might be able to purchase a home would not likely be able to purchase a home with amenities such as a pool, fully equipped exercise room and a home theater.

These items are often considered luxurious and are not available in the majority of homes which are on the market at any particular time. In fact searching for homes which specifically have these features may severely limit the number of search results and may result in no search results at all when these features are searched in conjunction with a typical price range. However, those who rent can enjoy access to these amenities. They may pay more in rent than those in a comparable apartment complex without these amenities but they are also still likely saving a considerable amount of money each month as long as they are budgeting wisely and have chosen a rental property within their price range.

Maintenance on a Rental Property

Maintenance on a rental property can be a confusing issue. Renters may mistakenly assume all maintenance is the responsibility of the leasing agent and maintenance staff but this is usually not true. In many cases the leasing agent and maintenance staff are responsible for maintaining the common areas and performing major repairs on the apartments but the renters do typically have some responsibilities. These responsibilities are often defined in the rental agreement and the renter should familiarize himself with this document to verify his rights if a dispute arises.

Renter Responsibilities

Typically renters have the responsibility of maintaining their apartment and the surrounding area. This may include the interior of the apartment as well as deck or patio space. However, maintenance of these areas applies to generally cleanliness only and not issues such as painting or repairs to the exterior or the interior of the apartment structure or the appliances within the apartment.

Additionally, renters are responsible for small repairs in their home. This may include plunging a clogged toilet or changing a light bulb. However, if there are any duties a renter feels uncomfortable performing such as changing a light bulb in a high location, the renter should contact the maintenance staff for assistance.

Renters also have a responsibility to show common courtesy to other renters by not intentionally damaging or otherwise marring public areas. This includes vandalism, littering and even failure to pick up after dogs. Renters who fail to follow these rules of common courtesy may be subject to fines or other penalties according to the rental agreement.

Leasing Agent Responsibilities

The leasing agent and maintenance staff are generally held responsible for major items such as repairs to the exterior of the building, fixing appliances which are malfunctioning and dealing with plumbing issues such as leaky pipes. Additionally, the maintenance staff is responsible for intervening if the renter is having trouble with public utilities. Problem such as no hot water or heat to the apartment should be addressed by the maintenance staff in conjunction with the public utilities entity.

The leasing agent and maintenance staff is also responsible for maintaining the common areas. This may include keeping grassy areas manicured and other common areas looking clean and attractive.

When the Leasing Agent is Not Taking Responsibility

As previously discussed, the leasing agent has certain responsibilities to perform tasks and address concerns and complaints by the renters. However, when the leasing agent is not fulfilling these responsibilities it could create a harmful living environment for the renter. For example hot water is required to adequately clean dishes. This is why there should always be hot water to the apartment. Additionally, in severely cold weather the inability to heat the apartment due to faulty utilities or windows which are not properly sealed can create a hazardous condition for the renter.

Both of the examples mentioned above are situations in which the renter may put in a hazardous condition by the leasing agent’s negligence. In these situations the renter should contact the Department of Housing to determine the proper cause of action to take in this situation.

In some cases the renter may be informed the alleged transgression by the leasing agent is not actually his responsibility. However, in other situations the renter may be informed that the actions of the leasing agent are a serious violation of the rental agreement. In either case, the representative can provide information on how to proceed to achieve the desired results.