Can I Put a Lockbox on my Rental if the Tenant Refuses to Sign the Lockbox Addendum?

Question

I’m selling my rental and the lease states that during the last 30 days I can show the property to interested folks. Also says I can have a lockbox on the door, etc. I contacted my tenant to give him a heads up about listing the house and requested that he sign the lockbox form that my realtor sent to him. He responded by asking for a discount on rent and said if he got the discount that he’d sign the lockbox form.

I politely said that I’d be unable to give him the discount on rent and that this is standard practice. I also reminded him that it’s in the lease. He’s since then become unresponsive and is not signing the form. If you were in my position, what would be your next step? 

Answer

Personally, I would give the tenant a discount if they keep the property in showable condition. 

Even if  the tenant signs the lockbox addendum, he can do other things to make it it difficult to sell. For example, keeping it dirty or messy.  We have seen tenants poison a sale in progress because they were unhappy about the showings.

If the tenant says no, and you still want to show the rental, give the tenant a Property Entry Notice and show it by appointment. Each state has different rules about the advance notice you need to give your tenants before you enter the property.

With the Property Entry Notice you are not asking to show the rental, you are letting the tenant know when you will be showing. 

What is Self-Touring or Self-Showing Technology?

What is self-showing or self-touring technology?

Self-touring technology allows a prospective renter to physically visit a vacant property without a manager or agent present. Renters can instantly book an appointment, saving countless hours finding a property to rent, and managers can streamline operations by supplementing traditional leasing office hours to easily conduct weekend and after-hour tours.

Which companies facilitate self-showing?

Rently and Showmojo are the two most popular companies.

Codebox is an alternative for small investors with only a couple of properties.  Codebox is much more affordable but it doesn’t have all the automation as the other two apps.

What is the cost?

Rently’s app is $30 per month plus $30 per lockbox. Showmojo has different plans but the most popular is around $79 per month, they just introduced their own lock boxes. Not sure what the price will be for that.

Codebox is the most affordable. the lockboxes are around $55 plus very minimal monthly charge, less than a dollar.

So how does Rently work? 

Rently syndicates rental listing to 50 plus sites including Zillow and Realtor.com. Prospective tenants are asked to schedule a self-showing tour online and to prove their identity using a credit card and an ID. 

After they schedule the showing and when they are at the property, they are given a one-time code to open the lockbox.

Potential tenants are asked questions about the condition of the property after they put back the key in the lockbox and emailed a link to an application.

All of this happens without an agent driving to the property. 

Doesn’t this appear intrusive to tenants?

Most tenants have no issue with self-touring because the major investors like Progress, American Homes 4Rent are also using Rently, so once a tenant verifies their identity, they can tour all homes on the market that are shown by Rently.

This is a major benefit that we didn’t realize we were going to get until we started using Rently. We got so much traffic from the major investors’ sites that using this technology was worth it even for just for the extra leads.

All of our rental properties were rented much faster with Rently than with us showing the homes.

Rently is our favorite self showing technology for couple of reasons. Everything is highly automated. Literally, all you have to do is put a lockbox on the door and wait for applications. 

Can You Evict a Relative or a Guest?

We get asked this question a lot. Instead of answering it by email, I decided to collect opinions from a couple of attorneys. 

This is from an article from the Orlando Sentinel. The attorneys Lambson and Brown are discussing what is the best solution to get a relative out of the house if they won’t leave and they don’t have a written lease.

Lambson-Eisele: Probably the easiest course to pursue would be a trespass, or ejectment, assuming the son was not on the title and the parents had given notice he was no longer welcome. … If he was given plenty of time to vacate on his own terms and if he didn’t do it within the time allowed by the parent, an injunction would likely be entered at some point.

Brown: Generally, you can bring an action for eviction and then an alternative of an unlawful detainer. Frequently, the family member will pop up and say the owner allowed them to stay if they fixed up the home or paid rent. … An unlawful detainer action is for a matter of there being no rental agreement, there’s no rent to be paid.

Here is another opinion I found in the attorney Ryan Shipp’s blog. He gives a great explanation of who is a tenant and who is a guest. 

What first needs to be determined is if a Landlord-Tenant relationship has been created. In simple terms, was money or rent exchanged for the ability to stay at the home? If your answer is NO, depending on a few factors that an experienced Unlawful Detainer Attorney will analyze, you must likely will have an action for Unlawful Detainer in order to regain exclusive possession of the home.

Definitions Not Associated With Unlawful Detainers

  • “Landlord” means the owner or lessor of a dwelling unit.
  • “Tenant” means any person entitled to occupy a dwelling unit under a rental agreement.
  • “Premises” means a dwelling unit and the structure of which it is a part and a mobile home lot and the appurtenant facilities and grounds, areas, facilities, and property held out for the use of tenants generally.
  • “Rent” means the periodic payments due the landlord from the tenant for occupancy under a rental agreement and any other payments due the landlord from the tenant as may be designated as rent in a written rental agreement.
  • “Rental agreement” means any written agreement, including amendments or addenda, or oral agreement for a duration of less than 1 year, providing for use and occupancy of premises.

Read the whole blog post here.

One thing I would like you to consider before evicting anyone. Most property managers and apartment communities will not rent to anyone who has had an eviction in the last seven years. 

Depending on who you want to remove from your home, a better option may be to get them to sign a lease with an expiration date and charge them a small amount of rent.  If they don’t leave by that date, you can evict them.

I think it’s a good idea to talk to an attorney and get a professional opinion. You can find attorneys we work with in our Directory.

 

20 Ways to Increase the Profits from Your Rental

Is your rental property paying you less than the cost of the mortgage?


Despite what many people think, making money from your rental property is not easy, especially if you have a mortgage. If you are ready to give up and sell your property, try some of our suggestions before you throw in the towel.


Most landlords think the easiest way to get more money is to increase the rent. This will be the most obvious way but not always the correct course of action. If you increase your rent above what market will bear, you will have vacancies, higher turnover, and bad tenants.


Here are 20 ways to maximize your profit without increasing the rent:


1. Rent your property by the room. Some landlords create separate leases for each roommate and treat each room as a separate rental.


2. Check out Airbnb – short term rentals may be just the thing for you.


3. Offer furnished home for short term rentals. You should be asking for at least 2.5 times your standard rental rates to offset vacancies, utilities, cleaning, etc.


4. Operate rooming house if legal – assisted living, halfway house, etc


5. Increase late fees and any other fees that come from tenants not following your rules.


6. Charge pet fees – you can charge a very reasonable monthly pet fee, most tenants with pets will be happy to pay it.


7. Offer additional services to the tenant: landscaping, house cleaning, pool cleaning. Contract them out and collect fees from those services. Some tenants will gladly pay more for convenience.


8. Strategic upgrades and home staging can add a lot of value without a big price tag. Our favorite upgrades are a nice kitchen faucet, new hardware on cabinets, and smart locks. If the appliances are old and broken, replace them. This will save you money on unnecessary repairs and allow you to get higher rent.


9. Repairs – many expensive repairs can be eliminated by regular maintenance and property checks. Every six months deliver new filters to the tenant, clean the drain, the dryer vent, etc. have a page with instructions and videos on how to fix minor issues: like resetting the disposal.


10. Minimize vacancies and turnover time. Use professionals who can turn over the unit in a day. Start showing a month before the old tenant moves out. Offer free cleaning while showing the unit. It’s worth it. Price it well!


11. Chose the right tenant: I can’t emphasize this enough. Tenants who can barely afford the rent can make your life miserable and be very demanding and expensive.


12. Transfer some of the cost to tenants: for example, pest control. Give them a pest clean house and one week to report any problems. After that, it will be their responsibility to keep it pest-free. You should fix any infestations but you have to charge them for it.


13. Conduct regular inspections. It’s best to combine the inspection with preventative maintenance. Your tenants will be happy because you are taking care of the property and not consider the visit as an intrusion.

14. Ask the tenants to give you a professionally clean house and carpet when they leave. You can refer them to professionals you use. Conduct the final inspection after that has been done. Include a charge in the lease if the cleaning has not been done.

15. Accommodate tenants if they want to leave early but charge fees – two months’ rent is reasonable.

16. Offer to rent a washer, dryer, furniture or security system.

17. Offer to rent storage if you can place a storage unit on the property

18. Charge a fee to customize the home – possibly paint a room or a wall. Don’t ever let the tenants do it. Send your handyman.

19. If you are using a property manager can you just use him to lease the property and you do the rest?

20. Finally, examine your taxes and insurance. Is your property assessed property? Are you overpaying for insurance?


I hope this list gave you some ideas. If you are already using any of these methods to increase your rental income please share your experience with us.

Is it recommended to install a washer and dryer in a rental house?

It depends on the property and the location. If you have type A property and competing rentals offer washer and dryer, you need to provide them as well.

Type B property yes with a slightly higher rent.

Type C, no, unless they rent it from us, typically at $50 extra per month.

That being said, you should definitely offer washer and dryer hookups. It makes a difference in how fast you rent your property.

If you let your tenants bring a washer, dryer or any appliance for that matter, insist on a professional installation. This is a lesson we learned from experience.

 

My tenant has told me that he will not pay rent this month. What can I do? Can I change locks? Can I hold his stuff until he pays me?

This is a question we received today from a brand new landlord.

What can you do if the tenant has told you that he is looking to move but also has not given you notice or has told you that he will not be paying for his last month’s rent?

This is the exact situation why last month’s rent needs to be collected at the beginning of the lease. Even though our lease states that security deposit cannot be used for last month’s rent, there is very little one can do to enforce that.

That being said, serve the tenant a 3-Day Pay or Quit Notice the day after the rent is late. If they don’t pay, file for eviction.

What you shouldn’t do is change the locks or hold his stuff. This is self-help eviction and it’s illegal in nearly all states.

Here is more information on the eviction process in Florida.

 

My Tenant Is In Medically Induced Coma. What Should I Do?

If you have an emergency contact for your tenant, it’s best to call that person. If you inherited the tenant, look in the lease, you may find it there.

If you can’t find it in the lease, call her work or ask the hospital. 

The emergency contact may have the legal authority to end the lease and come and get her things. Or, conversely, to pay the rent. Being listed as an emergency contact doesn’t give anyone the right to enter the rental or to make decisions for the tenant.

A medically induced coma rarely lasts more than a few weeks, so in addition to finding out who is the emergency contact for the tenant, waiting it out maybe the best course of action.

I would definitely recommend consulting an attorney if this lasts more than one month. 

 

Recommended Hard Money Lender – Florida

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You can search BiggerPockets to see why customers love working with us!

Low rates, fast closings, and great service.

– Fix/Flip Loans – Up to 90% of purchase and repairs

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Not a broker nor a bank, but a fully funded lending partner that can close consistently and help you grow your business. LendingOne uses our own capital, an easy online application, and our extensive real estate experience to provide quick and reliable funding for our clients.

Our experienced management team truly understands the real estate business and has taken an investor friendly approach to the lending business. We are self-funded, allowing us to move quickly and finance your project using 100% of our own capital.

With our proprietary technology, we have streamlined the real estate lending process. At the click of a button you can be pre-qualified for our competitive rates. Pre-Qualify online 24 hours a day, seven days a week and we will get you to the closing table in as little as ten days.

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Investor

Codebox Review

Codebox is my favorite solution for landlords who have less than 5 rental properties. The cost for the lockbox is $46-$56 (prices may change) one time. I like that you own the lockbox and you don’t have to pay monthly fees.

Screen of dashboard of Codebox

This code allows you to send a code to potential tenants for a viewing. You can ask them for a selfie and copy of their driver’s license before they can view the property. The code is only valid for a one-time viewing.  

You can pair the Codebox with some showing apps but all of them are too expensive for just a couple of rentals.

We tried the Junior Codebox and the only negative we found is that sometimes you have to press the buttons really hard to make them work. I don’t hear the same complaint for the Larger Codebox.

If you are a landlord with small number of rentals, this is a time saver. We have used a similar lockbox in our business (Rently) and we’ve never had an issue.