Home for the Holidays!
We are approaching that time of year when people just want to hunker down and “nest” over the holidays. November, December and January are slow turnover months for the rental industry. So what do you do if you find yourself with a vacancy for your investment property in mid November?
I recently received a call from someone who had just purchased an investment property and was upset and confused over the types of inquiries she had been receiving from her Craig’s List advertisement. “I’m just getting flakes,” she moaned. “People who want a short term lease, only three or four months. I just want a year-lease and be able to forget about it for twelve months” she whined. Wouldn’t that be nice, to just forget about it? Apparently this investor is a new to the rental market. But that aside, I suggested, given the time of year, she re-evaluate the short-term tenant. I pointed out to her that premium rents are generally achieved in the Spring and early Summer. And if she didn’t get her house rented over the next several weeks it could be sitting empty for the three coldest months of the year. Losing three months rent is bad enough, but having to heat an empty house just makes it even more painful. “You might want to consider that 4-month tenant,” I suggested. That will take you through mid February, then at that time you are positioned perfectly for potentially higher rent and can have a 12-month lease that will renew in the Spring, one of the best times of year to rent.”
Should you consider a short-term tenant for the winter months?
It’s a hard call to determine whether or not a short-term lease to fill the winter months is a good decision. There are many variables that apply to different properties. Each property needs to be assessed individually. I’ve noted below some pros and cons of a short-term winter lease to consider:
Less chance of frozen pipes or other winter damage
Tenant pays utilities – no utility cost to owner
No marketing expense during slow months
No minimum management fee for empty property
Positions lease renewal in Spring, better for rent price and activity
Cuts down maintenance costs: Snow removal & general upkeep
Additional lease-up cost in Spring
Wear and tear from multiple moves
Additional re-key expense
Down-time during turn over
Even if you do decide that short-term is an attractive option, finding short-term tenants is not always easy. The renting public is trained to expect a required 12-month lease. They often don’t even consider short-term as an option.
If your property is currently vacant and you would like us to market a three to four month lease term option. Give us a call and let us know. We are doing everything within our power to get your property leased before the Holiday’s are upon us.
NARPM Report on Average Rents for 3rd Quarter 2015.
Vacancy rates moved down slightly to 3.6% for the 3rd quarter of 2015. This is a decrease of .3% from last quarter. The largest decrease in vacancy rates from last quarter was multi-family homes in Ada County. Canyon county multi-family had a decrease of .2% and single family homes where unchanged.
Rental rates in Ada County increased on the average of $22 for single family homes. There was an overall increase of $82 in rental rates for multi-family homes, in Ada County. On the average Ada County showed a $33 increase in rental rates over last quarter.
Rental rates in Canyon County showed an average increase of $54, from last quarter. The increase in rental rates for Canyon County was solely due to the increase in rates for 5 bedroom single family homes.
Both Ada and Canyon County experienced the vacancy decreases for the 3rd Quarter of 2015. Although both counties experienced the vacancy decrease, Ada County had the higher reduction in vacancy rates by a full .4% over last quarter.
Some general real estate fun facts for you this month. Enjoy!
- McDonald’s is not just a burger-flipping restaurant chain. It is one of the world’s best real estate portfolios.
- The White House has been valued at approximately $110 million.
- In the United States, there are 5 times as many vacant houses as there are homeless people.
- Utah has been giving free homes to the homeless since 2005, which has cut chronic homelessness by 74%.
- The Seattle Kingdome was so expensive that the building wasn’t paid off until 2015, a full 15 years after it was demolished!
Source: REtipster. Read more mind-blowing facts at: http://retipster.com/35-real-estate-facts/