CT Real Estate Today - May 2022 Edition

In This Month’s Edition Experts Weigh In On The Unstable Real Estate Market In Connecticut

As Home Prices Rise, So Does Insurance Costs

Elements Of Tenant Screening And Why Is It Important?

Lamont Signs The Budget

May 2022

Published by:

Table of Contents Publisher’s Message A Message From Bob DeCosmo, President Of CTPOA

News And Views From The Capitol Lamont Signs The Budget

Realtor Report Experts Weigh In On The Unstable Real Estate Market In Connecticut

Insurance Insights As Home Prices Rise, So Does Insurance

Property Management Tips & Tricks 7 Property Management Tips & Tricks For Success

Helping Property Owners Since 1994

Published by: CTPOA

CTPOA’s Mission:

Financially Speaking A Financial Plan For Your Home

Get Energy Efficient 10 Energy Saving Tips For Spring

The Legal Corner Top 10 Tips For Landlords

Vendor Spotlight ServiceMaster Restore, specializes in restoration services for your property!

Tenant Screening Tips & Tricks Elements Of Tenant Screening And Why Is it Important?

Educate our members on the Best Practices.

Increase profitability.

Provide access to Core Services.

Advocate for Property Owner Rights.

Meet Our Team: Bob DeCosmo Carmine DeCosmo Melissa DeCosmo Paul Jenney

Chelsea Sayegh

PO Box 4795 Waterbury, CT 06704 800-369-6153 info@ctpoa.com

By Bob DeCosmo Advocate For Property Owner Rights Connecticut Landlords Survive Legislative Session The legislative session ended at midnight on May 4 th, much to the relief of those of us working the housing proposals on the side of the property owners, rental agents and property managers.

Never in the history of our State had so many progressive housing policies been proposed that made it out of the Housing Committee and were viable Bills right up to the last day of the session.

In the end, three Bills passed that impact housing.

1. SB 4 allows electric charging stations to be installed on an owner’s property, but all costs associated with these stations must be paid by the tenants. The Bill is phased in over the next 3 years based on the number of units in the apartment building.

2. HB 5205 mandates Fair Rent Commissions be established in every city with a population over 25,000

04 / Publisher’s Message

3. HB 5045, a proposal that dramatically lowers the blood level were a child is considered lead poisoned was signed into law by the Governor.

This is a serious matter and at such low blood lead levels, many more property owners will be forced to provide costly lead-abatements to their units. Owners should be pro-active and seek out low-cost funds and grants now to remediate lead from their buildings before the funding runs out!

This year could have been a disaster for housing providers as Bills to limit lookbacks on eviction records to just one-year, limit application fees a landlord can charge, do away with lapse of time evictions, make housing a basic human right and require

energy labeling for rentals all had momentum at some point.

What we consider good policy, others consider it bad policy. The Legislature is full of different opinions and it’s something that can’t be ignored if you are an owner of rental property, you need to get involved.

Next session, all the bills that didn’t make it will all be back. Advocates from both the tenant and landlord side will be engaged once again in pushing for

housing policy that favors their opinions. Hopefully owners of rental property will not ignore this new reality and understand now legislative advocacy is part of their role as a landlord.

Remember, most legislators never managed rental property and the squeaky wheel gets greased…. owners must be prepared for another round of protenant legislation in 2023 in Connecticut.

05 / Publisher’s Message

Lamont Signs The Budget By: Christine Stuart, with ctnewsjunkie.com Alongside Democratic legislative leaders, Gov. Ned Lamont signed the $24 billion budget adjustment Monday that includes $600 million in tax relief.

That’s more than they anticipated they would be

able to offer Connecticut residents this Election year because revenue came in higher than expected, but it still creates about an $800 million deficit in 2024.

“I thought about this as our first budget as we’re coming out of COVID,” Lamont said Monday during the capitol bill signing. “And what do we want to accomplish and what is the foundation we want to build upon.”

He said the investments in child care and children’s mental health were going to be helpful to get people back to work.

pension debt.

“I’d like to give a shout out to Dan Malloy,” Lamont said. “First thing you do when you find yourself in a hole is stop digging. He stopped digging.”

He said it’s the “largest or one of the largest” tax cuts in the history of the state. “I really wanted this to be a middle class tax cut,” Lamont said.

The budget also includes a 25 cent gas tax cut, and continues to fund free bus service until December. It creates for one year a new $250 per -child tax credit for lower and middle earning families and expands for one year eligibility for

the Earned Income Tax Credit, which boosts the tax returns of the state’s working poor.

More permanent tax breaks include a provision that caps the mill rate at 32.46 which will reduce

Lamont also said the budget also pays down a

the car taxes in 75 towns and reimburse

substantial portion of Connecticut’s unfunded

municipalities for the lost revenue. The budget

pension liability. The budget enables the state to

also expands eligibility for a property tax credit

make an $3.5 billion payment on its unfunded

and increases it from $200 to $300. Another

06 / News & Views From The Capitol

provision speeds up a plan to eliminate taxes on

Republicans and Democrats alike have used the

pensions and annuities.

budget as a political document. “I know people

The budget leaves much of its surplus unspent, ensuring the state can make a scheduled $3.58 billion contribution to its long unfunded $95 billion debt, including about $40 million in pension debt.

“I’m the first governor in four years that did not

want a wedge issue, but I got a problem for you that you can’t solve,” House Speaker Matt Ritter said. “It won’t be the budget.”

He said he looks forward to talking about the budget for a long time to come.

raise income taxes and did not raise the sales tax “This is a budget that meets the moment,” Rep. rates,” Lamont said. “I think that’s

Sean Scanlon, D-Guilford, said.

transformative.”

He said there are a lot of things going on in the

Republican lawmakers argued that Lamont

economy at the moment that are out of the state

should have cut even more in taxes, including the government’s control right now. income and sales tax.

“Whether it’s the price of gas or the cost of

This weekend during the party convention,

inflation, we, unlike many other states in this

Republican gubernatorial candidate, Bob

country, were in a position because of the fiscal

Stefanowski, has said decreasing taxes in an

turnaround that we have experienced to do

Election year doesn’t make up for the three

something about that,” Scanlon said.

budgets Lamont has signed to increase taxes since taking office in 2019.

He said Connecticut is paying less on gas than almost every state in the nation and the one-time

“Billions and billions in debt with absolutely

child tax credit means a family making under

nothing to show for it,” Stefanowski said.

$100,000 a year with two kids will receive $500

“Connecticut has the second highest taxes in the

by August.

entire country. We’ve got crumbling infrastructure that most states would be embarrassed of.

Retired people on fixed incomes forced to leave Connecticut.”

He said the Republican plan would have required the state winning a lawsuit against the federal government that several red states have been

trying to do since last year to no avail.

On Monday he added: “Apparently, Governor Lamont thinks that he and Joe Biden taking $5,200 out of your left hand pocket and putting $400 back in your right hand pocket is a ‘historic’ tax cut. Frankly, it’s insulting to Connecticut’s working families, seniors, and small businesses.”

“We wanted tax cuts that were targeted to the families who needed it the most,” Lt. Gov. Susan Bysiewicz said. “That’s why we target the car tax and the property tax expansion.”

Scanlon said what they did was “actual real relief to people.”

07 / News & Views From The Capitol

Experts Weigh In On The Unstable Real Estate Market In Connecticut By: Julia LeBlanc, with fox61.com These past two years, the real estate

know? The four-bedroom, three

market has been unstable and with

bathrooms, white picket fence, two-

real estate properties asking way over car garage, all that is just quite the asking price, families are struggling to buy homes in Connecticut.

expensive right now," Madonna said.

Madonna's realtor, Wesley Krombel, works with about 10 people like him

As the spring season sets in, things

every day. Krombel said the market is

could continue as they are, experts

unstable with a lot of demand and

warned.

very little supplies.

Nick Madonna and his wife have been "We have historically low inventory, looking for a home for almost a year,

which we hit a new record low this

because of the high real estate

winter, not just in Connecticut but

premiums, they downsized to a

nationally. And then you have this

condo.

pent-up demand of buyers who are

"I guess it's the American Dream, you

08 / Realtor Report

looking to buy with historically lowinterest rates," Krombel said.

Low-interest rates make it easy to borrow from the bank, but competition is stiff. Connecticut saw what was called "The New York Wave," which drove up prices and more.

"The baby boomers' kids are getting into the home buying.

So we have this largest age group in America getting into buying properties," Krombel said.

While it is a tough time for buyers, Krombel said it is an amazing time for sellers because they are in the driver's seat.

Krombel is encouraging people to list their homes even if they don't have another one lined up because you will get more than before and

over time, it could stabilize the market.

"They can really kind of dictate

be forced out of their house," Kromel said.

Krombel said it will be at least until the end of the year before things start looking up. Things have not changed much and the winter going into the spring is still intense.

"You have to be competitive right now, or you will be outbid," he said, adding he continues to encourage his clients to keep their spirits high.

when they close and they have to understand that they're not going to

09 / Realtor Report

As Home Prices Rise, So Does Insurance By: Paul Nelson, with 2news.com Inflation is affecting every part of the

100% but says it is not necessary to

United States, including the housing

over-insure your home. There are

market. The median home sale price in some other things they can do to help Reno-Sparks has more than tripled since 2010 and construction costs are also rising. As that happens, homeowner's insurance has to keep pace with inflation. Those rates are typically adjusted every year, automatically.

"We have an inflation writer in the

policy that will increase," Christina Kantrud, State Farm Insurance Agent said. "It will look at the market rate index every year and it will increase."

themselves.

"It's really important, especially, right now, that homeowners are meeting with their insurance agent and doing an insurance and financial review or insurance checkup, once a year," Kantrud said.

Eric Beer and Tom Swan met with their

agent about 10 months before the Pinehaven Fire swept through their Caughlin Ranch neighborhood. Their home was one of five destroyed in the

Kantrud recommends that clients cover fire in November 2020. their home's replacement value at 10 / Insurance Insights

"When we left the house, we thought

Beer did not say who they buy

it was just smoke intensity, so we left

insurance from. Kantrud says that

the neighborhood, thinking we were

State Farm's goal is to replace homes

coming back that night or the next

to be as similar to the original as

morning," Beer said.

possible.

They are renting their neighbor's

"If you've flown in marble from a

house while theirs is being rebuilt. The different country, we want to make could move back in this fall if not

sure that

sooner. Dealing with their insurance

when we

company was a challenge though.

replace

"The insurance company said it was too much money, that they didn't want to put that kind of money into it," Beer said.

The company eventually paid to rebuild the $1.7 million home but the new house will be different. The original house was 4,500 square feet.

your home, we can add that same exact marble flooring that you had before," Kantrud said.

That is why she encourages annual meetings and for each homeowner to take inventory of their belongings.

The new one will be 4,000 square

"It's important that they also go

feet. Beer says they dealt with eight

through with a camera, write

different insurance adjusters and

everything down, so not only can we

there was a lot of back-and-forth

replace on the outside of the home

before the issues were resolved.

and the structure, but we can also

"We were quite satisfied with that conversation as far as upgrading the

replace what's on the inside," Kantrud said.

insurance needs for personal

She says doing that also speeds up

property, for replacement value, all

the process for clients if they do have

that," Beer said.

a situation where they have to rebuild.

11 / Insurance Insights

7 Property Managements Tips & Tricks For Success By: Servicemasterclean.com Property management requires handling

protocol such as issuing a warning or having

multiple jobs that range from dealing with

the vehicle towed.

tenant issues to negotiating contracts for garbage removal, grounds keeping and janitorial services. Effective property

2. Keep Up-To-Date Books or Hire a Bookkeeper

management keeps everything running

Maintaining organized financial records

smoothly, 24/7. However, things can and do

regarding tenant rent and property expenses

happen. Consider these 7 property

such as maintenance, employee payroll and

management tips and tricks to help smooth out

trash removal is essential. You have to know

various issues and situations.

what money is coming in and what money is

1. Set Protocols and Policies; Remain going out. If your other property manager duties Consistent Property managers must have set policies and

protocols to eliminate miscommunications and

don't allow enough time for bookkeeping, consider hiring a qualified bookkeeper.

3. It’s Okay to Outsource

potential problems with tenants. All property

Sometimes it's simply good business to

rules for tenants should be in writing and

outsource -- like hiring a bookkeeper when

provided upon lease signing. Likewise, it's

you're drowning in financial paperwork. Certain

essential for property managers to have

repairs should also be handled by specialists.

protocols in place for different situations. If a

An apartment with carpet that has been soiled

tenant violates parking policy, then it's up to the repeatedly by pets requires professional property manager to follow through with the

cleaning.

12 / Property Management Tools & Tips

4. Schedule/Perform Routine

6. Attempt to Resolve Disputes First

Inspections to Reduce Problem Risk without Lawyers Regular inspections can help reduce the risk

Many tenant disputes can be solved by

of potential problems in and around the

meeting with the tenant and addressing the

property and its units. Items to inspect include issue. Follow all property protocols before but are not limited to:

threatening eviction and calling in a lawyer. In many cases, the issue can be resolved

•

All smoke/fire alarms

•

Fire/emergency door access

•

HVAC systems

•

Roof and downspouts

•

Decks

Hours

•

Windows (check for cracks and sealant

This may seem like the most simple of all

informally. Most common issues include noise

violations, late rent payments and inability for management to enter the apartment to conduct repairs.

7. Establish and Maintain Office

issues)

property management tips, but it's important

•

for your tenants to know when the

Water lines for laundry areas

management office personnel is available for

5. Maintain Supply of Essential

non-emergency situations. Established

Property Management Tools

business hours allow tenants to contact

Each property has its own list of management tools, which may include promotional/ marketing materials, safety items and paper essentials such as parking permits and blank lease copies. Keeping a well-stocked supply

of property management tools helps the day run smoother and may reduce hassles and headaches. An efficient property manager

property management easily when a maintenance call is needed instead of putting it off and allowing the problem in their unit to worsen, which can lead to costly repairs.

Regular office hours also make it easier for prospective tenants to come in and inquire about rental availability. It takes a lot of hard work to successfully manage any property.

also keeps inventory lists for on-site maintenance needs, office supplies and emergency essentials.

13 / Property Management Tools & Tips

A Financial Plan For Your Home By: Richard Koreto, with houselogic.com Do you pay each home-related expense as it comes? If so, you’re missing opportunities

Financial Plan Weekend Exercise?

•

How much you have to spend

a financial crisis when a slew of surprise

•

How much you need to allot in the short-

maintenance items hit. So take a holistic

and long-term for necessary maintenance

look at what it costs to operate your house

and voluntary improvements

and set up a home financial plan.

With this newfound grip on your home’s

Start by writing a list of expenses, such as:

expenses, you can create a home financial

for upgrades, or much worse, heading into

plan that’ll help you there for years with

•

Mortgage

•

Taxes

•

Home insurance, including liability

your home finances:

•

Repairs and maintenance, such as new

The Mortgage: Pay It — and Then Some

furnace, roof, painting •

Voluntary upgrades, such as a

maximum enjoyment and minimum anxiety.

Here's how to manage other aspects of

Yup, you already shell out a lot for your mortgage, but can you pay more? Even a

swimming pool, a premium range, a new

little extra each month can add up to an

powder room

earlier payoff. Let’s say you have $200,000

What Will You Learn From This Home 14 / Financially Speaking

in outstanding principal and a 20-year fixedrate mortgage at 5%. Your monthly

payment is $1,319.91. But if you can

coverage for your home and everything in

manage to pay another $100 a month, you’ll it. The average cost is $636 per year but save $14,887 in interest.

this varies widely by state.

Advantages of an early payoff, says Alan D. Liability coverage. Protects you from a Kahn, a financial planner in Syosset, N.Y.: •

Less debt means more money to spend

later.

•

It feels darn good to own your house

outright as soon as possible.

•

Minimal tax loss. Toward the tail end of

lawsuit if someone gets hurt on your property, for example. Your best bet: An umbrella policy. For about $300 a year you can buy a typical $1 million policy.

Various disaster insurance policies. Optional policies cover flood, earthquake, and hurricane damage. As part

the life of a loan most of your payment goes of your home financial plan, you have to to the principal, not the interest, so you’re research to see what disaster coverage, if getting only a small tax break anyway.

any, you need in your area, and what your

Of course, if you’re still saving for

standard policy already covers. For $540 a

retirement, put the 100 bucks elsewhere:

year you can buy flood insurance, for

•

A retirement plan

•

An account for the inevitable home

repairs •

example.

Don’t Under- or Overbuy Insurance For your basic policy, get homeowners insurance with full replacement

An account for discretionary

improvements, which can raise your home’s

coverage in case your house burns to the ground.

value That sounds simple, but heads up on Insurance: Protect Your Property

calculation. Remember that you own a

Your vegetable garden is pointless without a house as well as the land on which it sits. fence to keep out rabbits; likewise, your

So even though you bought your home for

home financial plan will come to nothing

$300,000, it may cost only $100,000 to

without an insurance “fence”:

rebuild it. Your policy limits should reflect

Homeowner’s insurance. Basic

this. This difference will vary widely by region.

15 / Financially Speaking

Another heads up: Don’t make the common Repairs and Renovations: By Choice or and potentially disastrous mistake of thinking that because your home has fallen in value you need less insurance. If you bought a $1.2 million townhouse in Florida during the boom, it’s true it now may only

sell for $600,000. But the replacement cost of the townhouse hasn’t changed much, so you can’t improve your home financial plan by cutting insurance costs that way.

Other ways to cut your insurance budget: •

If you make structural improvements,

such as adding storm shutters, your insurer may give you a break.

•

If you belong to certain groups, such as

AARP or veterans’ organizations, your premiums may be lower.

Necessity You own a home, so you’ll be spending money on everything from a new faucet to — surprise! — a new roof. Freddie Mac and other authorities say as part of your home financial plan, you should be prepared to spend 1% to 3% of the market value of the home annually on maintenance. To be extra -prudent, open a savings account and make regular payments until your account reaches 1% to 3% of your home’s current value.

To help you budget:

Start with the inspection report you received when you bought the house. Did the inspector indicate that you would need a new roof in five years? A new furnace in 10?

16 / Financially Speaking

Keep a log of your major appliances’ age so taxes from an escrow account, you need to

you can estimate when they’ll need

budget for them in your home financial plan.

replacing. Some estimated life spans:

They creep up almost every year, it seems.

Take responsibility for tracking the changes

•

Roof: 20-25 years

•

Heating systems: 15-20 years

sense of how quickly they’ve risen in the

•

Range/ovens: 11-15 years

past.

•

Water heaters: 8-13 years

Or if your lender handles escrow and you

Then get estimates on what replacements will cost and start saving.

Consider ongoing non-emergency maintenance, too. Do you live in New England? Price a snow blower and get bids

in your area: Look over past tax bills to get a

haven’t saved your bills, ask for an accounting. The median annual property tax payment is $1,812, but that hides the enormous range in medians from state to state.

from plow services.

You can generally deduct property taxes on

Resist the siren call of the home equity

your federal return. A tax pro can tell you

loan to take care of everything. That just

how much of a tax break you’ll get, to help

defeats your efforts to pay off the mortgage

you fine-tune your home financial plan.

early.

You may be able to reduce your tax burden

Separate out what you want from what you need. Believe it or not, some outdoor projects recoup more at resale than a kitchen redo.

If you can afford to redo, go for it. Just don’t confuse your necessary repairs (new oil furnace — about $4,000) with your discretionary upgrades (Viking range — $6,000 and up).

Taxes: (Almost) No Way Around Them Even if your lender handles your property

by getting a reassessment. Do your homework first: Are comparable houses taxed less than yours? Ask the local assessor what formula is used to set tax rates. You can challenge the assessed value and get yourself a rollback.

If you’re in a special group, you might get some help from state or local programs.

Check around to see what’s available in your area. New York State, for example, has its Star Program for giving senior citizens some relief from school-related property taxes.

17 / Financially Speaking

10 Energy Saving Tips For Spring By: Caitlin Ritchie, with saveonenergy.com As spring rolls in, it is time to perform

2. Clean your air

seasonal maintenance around your home.

conditioning unit and

Throughout the winter, snow, ice, and strong

get it inspected

winds could have impacted your home’s energy efficiency.

The average home spends about 12% of its

total energy usage on air conditioning. Clutter

Having an energy-efficient home ensures

and debris can affect your air conditioning

you consume less electricity and in return,

unit’s efficiency, meaning it has to work

helps you lower your power bills. Use this

harder to keep your home cool. Clear away

checklist to help you prepare for the warm

leaves from inside or around the unit and

months ahead and save energy this spring.

dust, vacuum, or spray the condenser fins to

1. Understand your home’s energy usage

remove remaining dirt and debris. You should also replace the air filter inside your house

Understanding where you are using the most

and schedule a yearly HVAC inspection with

electricity in your home can make it easier to

a licensed professional.

know how you can reduce your energy consumption. The SaveOnEnergy usage

3. Examine your roof and siding

calculator makes it simple to estimate how

Cracking ice, downed tree limbs, and the

much electricity you use every month and

weight of heavy snow could have dislodged

shows the appliances and devices that

shingles or siding on your home. This can

consume the most energy in your home.

create small gaps that let outside air, bugs, and

18 / Get Energy Efficient

small creatures inside and temperature-

and pet hair will collect on the coils of your

controlled air escape. You can often fix minor

refrigerator and make the refrigerator work

issues yourself, but should contact a

less efficiently. A long-handled brush is

professional for major repairs.

perfect for dusting and cleaning coils on the

4. Caulk around windows and doors to seal any cracks Similar to your roof and siding, harsh winter

bottom or back of the refrigerator.

8. Change the settings for lights that are on a timer

weather could have damaged the seals

You may have set indoor or outdoor lights on

around your doors and windows. These gaps

a timer so they are lit when you get home in

can let cool air sneak outside, impacting your

the evenings. Now that the afternoons are

home’s overall energy efficiency. Check to

getting longer, you may want to reset your

make sure you don’t see or feel any cracks. If

lights for later or turn the timer off altogether.

you do, use a caulking gun to fill them.

Only using your lights when you need them

5. Open the windows on warmer days The spring months often bring varying

will bring down your total energy usage.

9. Clean the grill

temperatures. Some days might be warm

Cooking outdoors is a great way to keep your

while others are below freezing. You can turn

kitchen cool, so pull out your grill from the

off the heat and open the doors and windows

garage and give it a good clean. If it’s a gas

when the temperature warms up. Not only will grill, make sure you have a full tank and check this help you lower your heating costs, it also allows your home to air out any built-up pollutants or humidity.

6. Switch the direction of your ceiling fan In the winter, your ceiling fans should rotate

the lines for any holes or cracks.

10. Lower your water heater temperature As the warm weather returns, it could be time to lower your water heater temperature.

According to the Department of Energy, your

clockwise on low speed to distribute the rising hot water heater could cost you more than warm air around the room. In the spring and

$400 annually. Turning down the temperature

summer, the fan should turn counterclockwise by 20 degrees could bring that cost down and to force air down into the room to help keep

will not have a big impact on how hot your

you cool.

water feels. What’s more, it will also mean

7. Clean off the refrigerator coils

your water heater won’t need to work as long and will use less electricity.

Warmer weather means more dust, pollen,

19 / Get Energy Efficient

Top 10 Tips For Landlords By: Beth Dillman, from nolo.com 1. Screen tenants.

Lease or Rental Agreement.

Don't rent to anyone before checking credit

3. Handle security deposits properly.

history, references, and background.

Haphazard screening and tenant selection too often result in problems, such as a tenant who

pays the rent late or not at all, trashes your place, or lets undesirable friends move in. Use a written rental application to properly screen your tenants.

Establish a fair system of setting, collecting, holding, and returning the amounts tenants pay up front as a security deposit. Inspect and document the condition of the rental unit before the tenant moves in, to avoid disputes over security deposits when the tenant moves out.

Check out your state's law to ensure you are

2. Get it in writing.

handling security deposits correctly.

Be sure to use a written lease or month-to-

4. Make necessary repairs.

month rental agreement to document the important facts of your relationship with your tenants—including the basics about rent payment and tenant responsibilities, as well as when and how you handle tenant complaints and repair problems, how much notice you must give to enter a tenant's apartment, and so forth. For what to include in a lease or rental agreement, see Ten Terms To Include in Your

20 / The Legal Corner

Stay on top of maintenance and repair needs

and make repairs when requested. If the property is not kept in good repair, you'll alienate good tenants, and they may be legally entitled to the withhold rent, repair the problem and deduct the cost from the rent, sue for injuries caused by defective conditions, and/or move out without giving notice.

5. Provide secure premises.

Don't let your tenants and property become easy marks for a criminal. Assess your property's security and take reasonable steps

incompetent, you may be held financially responsible. Do a thorough background check and clearly spell out the manager's duties so as to help prevent problems down the road.

to protect it. Often the best measures, such as 9. Obtain insurance. proper lights and trimmed landscaping, are not terribly expensive.

Purchase enough liability and other property insurance. A well-designed insurance

6. Provide notice before entering a unit. program can protect you from lawsuits by Learn about your tenants' rights to privacy; see Repairs, Maintenance, and Entry to Rented Premises. Notify your tenants whenever you plan to enter their rental unit, and provide as much notice as possible, at least 24 hours or the minimum amount required by state law. For state-by-state information, see Chart: State Laws on

Landlord's Access to Rental Property.

7. Disclose environmental hazards.

If there's a hazard such as lead or mold on the property, tell your tenants, either before they move in or as soon as you become aware of

tenants for injuries or discrimination and from losses to your rental property caused by everything from fire and storms to burglary and vandalism.

10. Resolve disputes.

Try to resolve disputes with your tenants without lawyers and lawsuits. If you have a conflict with a tenant over rent, deposits, repairs, your access to the rental unit, noise, or some other issue that doesn't immediately warrant an eviction, meet with the tenant to see if the problem can be resolved informally.

If that doesn't work, consider mediation by a

the problem. Landlords are increasingly being neutral third party, often available at little or no held liable for tenant health problems resulting cost from a publicly funded program. from exposure to environmental toxins in the

rental premises. See Lead Disclosures for Rental Property FAQ. Check your state law for other landlord disclosures.

8. Oversee property managers.

Choose and supervise your property manager carefully. If a manager commits a crime or is

If your dispute involves money, and all attempts to reach agreement fail, try small claims court, where you can represent yourself. Small claims court is good for collecting unpaid rent or seeking money for property damage after a tenant moves out and the security deposit is exhausted.

21 / The Legal Corner

For More Information Visit Our Website: landlordcollections.net Give Us A Call: (800)-369-6153

Terri Philibert ServiceMaster Restore

Title: Owner Hometown: New Haven County Terri has been in the insurance industry since the age of sixteen. Her career started out as a workers’ compensation adjuster and life care planning coordinator for municipalities throughout the State of Connecticut. She has been a partner in ServiceMaster Restore for the past three years, during which time she has completed IICRC training in water damage, odor control, and applied structural drying, as well as certification as an antimicrobial technician.

Terri can honestly say she gets up every day and loves what she does. She believes that Serge is a great partner and together they succeed in restoring peace to families who need it most. In her spare time, Terri enjoys spending time with her family, her horses, and volunteering.

24 / Vendor Spotlight

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Elements Of Tenant Screening And Why It Is Important By: Mariia Kislitsyna, with landlordtips.com Whether you’re an aspiring landlord, a guru of Let’s find out, shall we? real estate, or somewhere in between, you probably know just how difficult it can be to find a great tenant. In some cases, it can be pretty challenging to find a tenant at all, let alone a good one or great one.

One good practice is to run a tenant

Here’s the skinny on checking potential renters and reasons why you should never underrate the significance of the tenant

screening procedure.

What is Tenant Screening, Exactly?

screening process. While screening tenants Tenant screening is the process of verifying the history, credibility, and trustworthiness of won’t help your situation when you have too few candidates, it is definitely a helpful tool to a prospective renter. This can be done by asking tenants to provide certain documents, filter out potential “bad” renters and narrow the applicant pool down to a few great

such as credit reports or public records, or by

choices.

obtaining them yourself with their permission

But, is running a tenant screening worth the effort? And, if so, what are the main advantages and disadvantages of prospective tenant screening for you as a landlord?

and using their identifying information. Also, as part of screening future renters, the landlord can contact the prospective tenant’s former landlord or property manager to obtain references and see if they have a great ontime payment history.

26 / Tenant Screening Tips & Tricks

Of course, as a landlord, you can never be

help you to understand better what kind of

entirely sure you won’t have problems, even person the applicant is. We might all have a with a future renter who passes the tenant

couple of speeding tickets, but you can also

screening with flying colors. However, it

discover some more serious issues worth

does provide an increased level of

your attention with a comprehensive

confidence and peace of mind. For

background check for renters.

example, credit scores. As stated on the Experian blog, only 8% of people with a good credit score (670–739) are likely to become seriously delinquent in the future.

The Tenant Screening Process In Detail The process and actions involved in vetting renters will vary from landlord to landlord, but there are a few common elements of a comprehensive tenant screening

•

Evictions. If you’ve never had to evict a

tenant in your life, it doesn’t mean the situation on the local rental market follows this pattern. For this reason, always remember to check if your potential tenant had any evictions before. If so, you can always ask a few questions to learn more about the situation rather than denying them immediately (the past year should have taught us that hard times can befall us all!).

procedure.

While you don’t have to consider each item,

•

Chat with their current landlord. You

here are a few of the most important

can always call the potential renter’s

aspects of the average tenant screening

property manager or landlord to get some

process:

references regarding the applicant. Thanks to this chat, you can learn if they had any

•

Information about the past and

problems with neighbors, if they pay on

current employers. This will help you

time, and the condition they left the

understand if your prospective renter has a

apartment after their residency.

stable source of income.

•

Keep in mind that we’re all human, and it’s

Credit check. You can see how an

ok to make mistakes! Certain info is not as

applicant’s current financial situation looks,

bad as it might seem — for example, 65% of

if they’ve had any problems paying bills in

students graduate with student debt, so it is

the past, and if they have any kinds of loans not so outrageous to see a 27-year-old with to be aware of. a college debt of some sort. However, what •

is important is the way your future tenant is

Criminal history. This is another

common part of tenant screening that will

dealing with it — if they treat it responsibly and are paying it off on time.

27 / Tenant Screening Tips & Tricks

Don’t look for a tenant with a perfect history —

also on some solid facts and data. You can pick

you might never find one. Instead, use tenant

a tenant who is proven to be financially stable,

screening as a guide to see if your potential

never has had any evictions, and has been

tenant has any undesirable behavior patterns

paying off their credit cards on time — all this

which might cause you trouble in the future.

knowledge based on reports rather than mere

Why Is Tenant Screening Important?

Now, after discussing what tenant screening is

chatter.

It Verifies the Tenant’s Credibility

and which elements to include in a

Many people tend to present themselves in a

comprehensive tenant screening, let’s see why

better light during interviews — to get a

it is so essential to run one every time you’re

desirable job, apartment, or even to seem more

searching for a new renter.

appealing to their Tinder date.

It Helps You Make an Educated Decision

Cross-checking facts is another reason to run a

Choosing a tenant is a decision that will affect you for many years, or one year at the very least. A bad tenant can make your life more difficult, while a good tenant should have as little impact on your life as possible, which is why you always want to find the best candidate.

With the help of a proper tenant screening procedure, you can base your choice not only on your interview with the potential tenant but

tenant screening. This allows you to see how honest the applicant has been during your meeting. If they claim that they had a perfect

relationship with their current or past landlord, but it turns out they got evicted for renting out a spare room, it might not be speaking in the tenant’s favor.

It Prevents You from Future Hassle and Trouble We all want to have our life as easy and

28 / Tenant Screening Tips & Tricks

smooth as possible. As a landlord, you might

First, as you could have figured out by

encounter many unpleasant situations or

yourself, tenant screening takes some of your

stressful emergencies, but it is in your power

time. From contacting prospective tenants and

to avoid some of them. Choosing a reliable,

asking them to send their credit reports and

honest, and trustworthy renter will save you

references to analyzing the data you receive

lots of time in the long run. What’s more, it will to contacting their colleagues and employers give you some peace of mind knowing that

to verify tenants, it can be a lot of work. This is

you rent out your place to a person you trust.

probably one of the main reasons some

It Might Save You Money in the Long Term This point is not about possible costs you might encounter if your potential tenant

landlords decide to forgo the tenant screening process when accepting a new tenant.

It Narrows Down the Candidate Pool

demolishes a bathroom and refuses to cover

Imagine you had ten potential renters who

the price of repairs or leaves without paying

were interested in your place. However, after

for the last two months (although this might

you asked each of them to send you their

also be the case!). Rather, you should keep in credit report and criminal history, only five of mind that the average cost of searching for a

them got back to you. What’s more, one of

new tenant turns out to be about $2,500!

those applicants had three evictions in the

That’s why it’s crucial to do your very best to

past two years and another maxed out on

pick a (good) renter who has the intention of

their credit cards. The math is simple — it

staying for a long time (and has a history of

leaves you only with only three decent

doing so before).

applicants to consider. While this may save you some time, it may also leave you with too

What Are the Cons?

few candidates in certain situations.

This article is mainly to promote the tenant screening process and to help you understand the importance of having a proper rental

Summing Up As you can see, tenant screening is a process

applicant screening in place. But you might be that requires a little bit of time and some

wondering – are there any drawbacks to

commitment from your side. And, sometimes,

running a tenant screening? Of course, the

it might seem like it is not all that necessary,

points below might seem disadvantageous at

especially if you already feel like the applicant

first, but — spoiler alert — we nonetheless

you met is trustworthy, or if it’s a friend of a

strongly believe in the importance of tenant

friend. However, you can never underestimate

screening!

the importance of tenant screening. With this

It Requires a Bit of Your Time

simple procedure, you can be sure that your rental will be in good hands!

29 / Tenant Screening Tips & Tricks

What’s Happening Near You? The Statewide Events and Meetings calendar is a resource for local landlords and property owners to meet up, network and grow your real estate opportunities.

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ecticut Property Owners Alliance is of experienced property managers, S and landlords working together to usiness conditions for rental property owners.

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About Us Advocates For Property Owners The Connecticut Property Owners Alliance is composed of experienced property managers, realtors and landlords working together to improve the business conditions for rental property owners. The Alliance saves its members money on essential real estate services, reviews and testifies on pending legislation & law changes and offers its members workshops and meetings on topics that impact landlords.

Why The Property Owners Alliance Was Formed The Alliance strives to ensure your success in real estate by: •

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