Q&A: Multifamily Market Insights and Opportunities: The COVID Impact on the Rental Market – Is it ti
Date postedMarch 12, 2021
On Tuesday, March 9th, we hosted an AAGLA Member Webinar “Multifamily Market Insights and Opportunities: The COVID Impact on the Rental Market –Is it time for Professional Property Management?” with Elizabeth Reynolds, President of Reynolds Realty Advisors. We had multiple members write in questions regarding the extension of the eviction moratorium under Senate Bill 91, the regulations you must follow under this new bill, the rental housing market, and more.
We understand your concerns at the time and have provided in-depth answers on how to help you best manage your properties under these new restrictions.
Question |
Answer |
| I am thinking I need professional property management, but I do not have all the rental agreements and papers. All of my renters are on a month-to-month basis. Would a property management company be willing to come in under these circumstances? | Yes, we can help! Please feel free to contact us at Reynolds Realty Advisors, 2009 W. Commonwealth, Suite F, Fullerton, California 92833, or email Elizabeth at Elizabeth@reynoldsrealtyadvisors.com. You can also call her at (866) 613-7772 or (949) 278-3430 (Direct). |
| Where is Reynolds Realty based? | We manage properties throughout Southern California as such, we have multiple offices throughout in each county including Los Angeles, Riverside, San Gabriel, Orange County and North San Diego. For more information, contact Elizabeth at Elizabeth@reynoldsrealtyadvisors.com or call her at (866) 613-7772 or (949) 278-3430 (Direct). |
| How do you market vacancies with dropping rents? What is your experience with concessions, and do you offer these in this market? Do you offer concessions on a case-by-case basis or overall depending upon market conditions? Do you suggest we charge separately for parking? | We have been very successful demanding top market rate for our rental units and in some cases, we set the market. We have many technics we use to lease units timely and at the highest rental rates. One technique is to offer a move in special or “Stimulus Incentive” of two weeks off the first month’s rent if they sign a six month to one-year lease, depending on the market. As for parking and other fees, yes, we highly recommend creating a separate agreement for these service and fees. |
| I served my tenant with 15-day notice. They paid 25% of balance following the notice, but for the next month, they did not pay and balance due has continued to grow. Do I have to serve another 15-day notice for each month that rental payments are missed? What do you suggest that I do? | Protocol is to continue to serve the proper 15-day notices to the tenant along with the declaration. The tenant is obligated to pay 25% of the rent due for the transition period, which runs from September 1, 2020 through June 30, 2021. They have until June 30, 2021 to comply with both of these requirements. If they do not comply with those requirements, they are not protected under the eviction moratorium under SB91. |
| My investment property, a single-family home, is rented with the lease date ending April 15, 2021. The State eviction moratorium under S.B. 91 expires after the lease end date, or June 30, 2021. May I seek to evict my tenant starting July 1, 2021? | If they have not complied with the tenant requirements of SB91, then yes you would be able to move forward with an eviction at that time, depending on the location of the property. Should it fall under Los Angeles County, then you would need for wait for the LA County eviction moratorium to end. |
| How do I give notice by February 28th for rent not yet due? | Under S.B. 91, a notice is due by February 28th to renters who, as of February 1, 2021, missed one or more rental payments. If rent is missed February 1, 2021 and thereafter through the expiration of S.B. 91 (Expires on June 30, 2021), you must still serve your non-paying tenants with the notice for each month missed. You should serve the notice along with a 15-day notice to “Pay or Quit” and a declaration that your renter is required to return to you within 15-days in order to be protected from eviction. The Apartment Association of Greater Los Angeles offers its members guidance on S.B. 91, including required forms and notices, under its Forms Library, Section K. |
| So, two years down the road, if my tenant has not paid the amount owed, can we then use that in our screening criteria? | Until the expiration of the protections under state law, S.B. 91, expire, you are prohibited from using non-payment of rent due to COVID in your screening criteria. |
| What happened to the typical 3-Day notices? Why is there now a 15-Day notice requirement along with all of the other notices and forms? | S.B. 91 requires 15-day notices. Get the guidance on the Apartment Association of Greater Los Angeles website. There is a complete summary and FAQs on S.B. 91 to help you with understanding. Effective July 1, 2021, we are able to serve a 3-day “pay or quit” notice for unpaid rent that is past due for July 1, 2021 and thereafter (unless state law is further extended). |
| If the tenant does not pay their rent in April, May, and June, how do you serve them a notice by February 28th? | The notice required by February 28, 2021 was only for renters who, as of February 1, 2021 missed one or more rent payments between March 1, 2020 and January 31, 2021. Thereafter, for the months of April through June in your example, you would also need to serve the same notice for each month of rent missed. |
| Within the City of Los Angeles, when will owners be able to evict a renter for “no fault” reasons or under a “no fault” eviction? | No Fault Evictions are on hold until after the moratoriums are lifted. |
| What happens if the tenant fails to move out at the end of a fixed term lease within the City of Los Angeles? | In this case, your best options are to either (1) work with the tenant to sign an amendment to the lease extending it out for another twelve months or (2) advise them that you will accept their 30 day notice including their final move out date. |
| Does the Apartment Association of Greater Los Angeles provide the required 15-day notice? | Yes. All S.B. 91 forms are available on our member only forms library. There are actually 2 types of 15-day notices, one for high income and one for non-high-income renters. |
| What collection agency do you recommend? | The Apartment Association of Greater Los Angeles recommends the following collection agencies:
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| Please advise about how I should handle collection on past due rents during the COVID declared emergency? | You can work with the above-mentioned collection agencies and/or pursue the civil matter in small claims court. Both options work best once the tenant is out of the unit and the SODA form is completed and issued. |
| Can a landlord request an update on new employment information for a tenant living in Riverside County? These tenants have been living at my property for 4 years | Yes, we use a contact form for them to complete so that we have all the current contact information on file. |
| I manage my own properties and would consider hiring a property management company. Tell us about the roles of your team, what you provide, fee, and how many units you manage. | Reynolds Realty Advisors provides full-service property management throughout Southern California, with a focus Multi-Family and commercial property. We offer flexible management models to best meet your needs. With over 40 years of property management expertise within the leadership team alone, our clients have realized:
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| Tenant paid 25% of rent for March 2021, for first time. We gave him the COVID notice form; however, do we also need to give him the 15-day notice to pay? What about the declaration? If he continues to pay 25% each month, do we need to serve these forms for each month? | Protocol is to continue to serve the proper 15-day notices to the tenant along with the declaration. The tenant is obligated to pay 25% of the rent due for the transition period, which runs from September 1, 2020 through June 30, 2021. They have until June 30, 2021 to comply with both of these requirements. If they do not comply with those requirements, they are not protected under the eviction moratorium. |
| Can we apply security deposit to unpaid rent balance after tenants move out? | Under S.B91 you can not apply the security deposit to unpaid debt curing the Covid-19 rental debt. |
| What is the timing for serving the 15-day notice? Use an example for rent that is due on the 1st of the month. Then, in counting the 15-days, do weekends and holidays count? Does the day the notice is served count? | You can serve the notice immediately after the rental due date has passed and the tenant has not paid the rent. |
| Do you furnish your rental units ever, or deal with short-term rentals? | We do stage the units to make them look very attractive and inviting. However, we do not furnish the units as we do not focus on short-term rentals as a business (“STR”). |
| Does S.B. 91 apply to past due rent prior to that law becoming effective, which was as of February 1, 2021? | Yes, S.B. 91 merely extends its predecessor, A.B. 3088, which had very similar provisions. |
| Do we need to serve the 15 day notices every month the tenant is delinquent? is that considered harassment? | Protocol is to continue to serve the proper 15-day notices to the tenant along with the declaration monthly as the balance due will change. The tenant is obligated to pay 25% of the rent due for the transition period, which runs from September 1, 2020 through June 30, 2021. They have until June 30, 2021 to comply with both of these requirements. If they do not comply with those requirements, they are not protected under the eviction moratorium. |
| Does the Apartment Association of Greater Los Angeles still have the 15-day notice? | Yes. On our member only forms library, under Section K. |
| You said you offer 6-month leases? Do you really do that? | Yes, as some tenants only want to be in the unit for a shorter duration due to Covid or job relocation related reasons. Often times that will allow us to get into a better period of time for leasing to a long-term tenant. |
| Do you recommend offering lease-break options? | Yes, for those tenants who are struggling during Covid, it is always best to create a win-win for you and the tenant. Once you have possession of the unit you can then get the unit rent ready and lease it to a qualified tenant who will pay the rent timely each month. |
| What is your fee structure? Is it a monthly percentage of rental income, flat fee, lease-up fee, etc.? | Please reach out to us at Reynolds Realty Advisors, 2009 W. Commonwealth, Suite F, Fullerton, California, 92833. Or contact Elizabeth directly at Elizabeth@reynoldsrealtyadvisors.com, or (866) 613-7772 and (949) 278-3430 (Direct). Contact us soon as we currently have a promotion offering the first month free of management fee after you have signed up for management service with Reynolds Realty Advisors. |
| I also have property in West Los Angeles Your firm is in Mission Viejo. Do you have local field people who know the West Los Angeles area, market, walk the properties there, etc.? | We have a distributed model allowing us to grow, while maintaining a localized focus. We have offices throughout Los Angeles, which support our clients whose properties are in the Los Angeles region. Our Area Managers and Regional Managers as well as our Maintenance Managers and team members spend 75%-90% of their time in the field at the properties for which they are assigned. |
| What property management software do you use? | We use AppFolio currently. While we have worked with sever other software platforms in the past, we find that AppFolio is both very comprehensive in terms of features and functionality, while at the same time remains very user friendly. |
| My tenant text me on February 24th that she will move out by March 10th. Then, finally she said she is moving on March 24th without 30-day notice. At what date does the 30-day notice period begin? | The 30-day notices period begins from the time they give you the notice. However, in the notice to vacate, the tenant will usually provide the details regarding their last day in the unit, as such that duration may vary. Should that duration change and/or they end up move out at a later date, as plans change, than you can charge them for the prorated amount of rent for those additional days in the unit. |
| Would Reynolds Realty Advisors be willing to provide references of clients in the Westside of Los Angeles? | Yes, we have a list of reference and would be happy to provide them to you. Feel free to contact us so that we can provide you with that information directly. We look forward to learning more about your portfolio and discussing how we can help you exceed your real estate portfolio goals. |
| Can evict a tenant who damages the property and unauthorized persons living in the property at the same time? | You may evict a tenant who damages the property and / or has unauthorized persons living in the property at the same time? However, within the City of Los Angeles, if your tenant has other occupants because they (tenant or occupants) were impacted by COVID (e.g., health or lost work, etc.), then you cannot evict on that basis. If they breach the lease for non-financial reasons, and not including nuisance, such as property damage and/or illegal activity, you have grounds for proceeding with an eviction. It is always best to seek legal advice on your individual situation. |
| If I want my tenant to vacate the unit, and do not want them to be on a month-to-month lease, my lease form has no language regarding transformation to a month-to-month lease basis. So, do I have a choice to get them out and avoid the month-to-month lease situation? | Depending on the country for which your investment property resides, you maybe able to give them a 30-day notice to vacate the property given the lease is coming to term. However, if they have executed the SB91 declaration and have paid 25% of the rent due, then they are protected under the eviction moratorium. |
| Does your property management company provide leasing-only services? I’m considering a property management company but would like accelerated efforts to reduce an inventory of vacancies which have happened between 2020 through this past month. | We generally provide full-service property management. We have at times provided specific property management services. We are open to discussing that option with you. Feel free to contact us directly to discuss your specific requirements in more detail. |
| Have you seen an increase by owners that previously managed their properties on their own, now retaining third party, professional property management companies? | Yes, there are many owners these days turning over their real estate portfolio to Reynolds Realty advisors for our full property management services, allowing them to enjoy more time and money! Thus, making their real estate investment properties the passive income investments, for which they had always intended. |
| Does your company’s legal “team” provide the legal-related services as part of the monthly management fee charged? How do the legal services work into the overall services provided by Reynolds Realty Advisors? | Reynolds Realty Advisors collaborates with our legal team to ensure that we are always incompliance with fair housing, ADA and all of the ever-changing guidelines within the real estate industry. Should we need to engage their services for an eviction, those costs are absorbed by that specific property as a property level expense. |
*Please note, this Q&A is for general information purposes only. Before acting, be sure to receive legal advice from an attorney.
Got More Questions?
Reynolds Realty Advisors
22431 Antonio Parkway, Suite B160-244
Rancho Santa Margarita, California 92688
Elizabeth at Elizabeth@reynoldsrealtyadvisors.com.
(866) 613-7772 (Office) or (949) 278-3430 (Direct)
www.reynoldsrealtyadvisors.com
Reynolds Realty Advisors
22431 Antonio Parkway, Suite B160-244
Rancho Santa Margarita, California 92688
Elizabeth at Elizabeth@reynoldsrealtyadvisors.com.
(866) 613-7772 (Office) or (949) 278-3430 (Direct)
www.reynoldsrealtyadvisors.com