Tag Archives: rental

THE PROBLEM WITH PROPERTY MANAGEMENT FIRMS.

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As I get older, I think more and more about hiring a property management firm. I am not going to be able to do this myself forever. However, I am constantly seeing what happens when an incompetent property management firm takes over managing a property, and there a lot of incompetent property management firms out there. Some professions require licenses and tests, like plumbers, electricians, general contractors, etc.; but anyone can say ‘I am a property manager.’ You don’t have to have a license or pass a test to manage small rental properties. The problem for me is that top-quality property management firms don’t want to take on a client who owns as little property as I do. Take a look at the photos below of work done by incompetent property managers. Note the:
1. Badly designed wheelchair ramps at various apartment houses.
2. Smoke alarms. All the smoke alarms in the building were installed this way. They are supposed to be dated.
3. Seismic repair of a support column holding up the building.
4. Sandbox built over a manhole cover at a low-income housing project.
5. A Craigslist listing of an apartment for rent included this photo of the swimming pool with abandoned mattresses in it.
6. The building’s handyman didn’t know that you don’t attach a ground wire to a plastic pipe.

7. Carpet. The managers of these apartment houses used poor judgment in choosing the hall and stair carpets.

WORST APPLICATION EVER.

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I used to manage a restaurant here in Berkeley. Part of my job was to hire new employees. Normally, people are on their best behavior when they are trying to get something, like a job, an apartment, or a loan. However, sometimes people would say very insulting things to me while they were applying for jobs. Some people say insulting things to me now while they are applying for apartments. On one occasion, an applicant for an apartment looked me in the eye and said: “I hate landlords” while I was reviewing his application with him. I have asked people who run businesses if they ever had an experience like that while interviewing a job applicant. Several said: ‘Yes’. A psychologist I know explained this to me. She said that when a person applies for a job or an apartment while he is insulting the person who can give him that job or apartment, it is probably because he wants to be rejected. A person may apply for a job that he doesn’t want just so he can collect unemployment insurance. A person may apply for an apartment that he doesn’t want in order to please his parents who are nagging him to move out of their house and get his own place. And sometimes, people say insulting things without even being aware that what they are saying is insulting. The Kitchen Crier was one of those people.

The Kitchen Crier.  In 1999, I rented a one-bedroom apartment in the Rockridge district of Oakland. Over 50 people came to my one and only showing, and 20 of them turned in applications. That wasn’t unusual in 1999. It was the height of the Dot-Com Bubble of the late 1990’s. Besides, Rockridge is a very desirable neighborhood, and there aren’t a lot of apartments in Rockridge. At the end of the showing, I sat down on the living room couch to review the applications I received. I thought I was alone until I heard the sound of somebody crying. I got up to investigate. To my surprise, I found a young woman sitting at the kitchen table, crying, and holding a handkerchief over her eyes. There was a partially filled-out rental application form on the table. I said to her: “Are you OK?” She shook her head and said: “Yes,” so I went back to the living room. I wondered why she was crying, but I didn’t know what to say. After a while, she came out of the kitchen. She had stopped crying. Then she looked around the living room and started crying again. I said: “Is there anything I can do?” She shook her head and said: “No. It’s just that my mother warned me that I’d wind up in a place like this, but I didn’t believe her.” Then she handed me her rental application and walked out. I watched her drive away – still crying. I don’t think that she was trying to be insulting; however, she was aware of the fact that she wasn’t the only person who wanted to rent this apartment. A lot of people left applications while she was there. The apartment wasn’t a dump. I don’t rent dumps. It was in superb condition. As you may have guessed, I rented the place to somebody else.

San Francisco Rental Ad From 1970.

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Below is a section of the For Rent ads from the San Francisco Chronicle in 1970. Look at the prices. Although it may seem hard to believe, back in those days, San Francisco and Berkeley were considered cheap places to live, that is, compared to big cities back East like New York and Boston. One of the main reasons why the hippies came to San Francisco and Berkeley in the 1960s was because they could find cheap housing here. Counter-culture people in every generation move to places where they can find cheap housing. Then they move elsewhere when housing gets expensive. That is something that never changes. Tourists, mostly from foreign countries, still go to the Haight Ashbury district in San Francisco expecting to see hippies and ‘flower children’, but there aren’t any. A 1 bedroom apartment in the Haight Ashbury district now rents for $3,000 to $4,000 a month. Of course, a portion of the increase in rents in the Bay Area can be attributed to inflation, but only a portion. When I arrived in Berkeley in 1972, I rented an apartment downtown for $80 a month, and I knew people who were paying much less than that.

Craigslist Rental Scams. The Needless Credit Report

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Craigslist Fraud. A new study from New York University found that 1.5% of all Craigslist rentals ads in the United States are scams and that more than 50% of these fraudulent ads go undetected by Craigslist. I’m pretty sure that a lot more than 1.5% of Craigslist rental ads in the San Francisco bay area are scams. That is because there is a serious shortage of rental housing in this area, and prospective tenants sometimes get desperate.

The Needless Credit Report.  The most common rental scam is the needless credit report. It works this way. A crook creates a Craigslist rental ad for an actual property, but not a property that he owns or manages. To attract victims, the crook makes the rental look like a huge bargain. The ad says that in order to rent the apartment, you have to fill out an online application form and submit a credit report. The ad directs prospective tenants to a shady credit agency – a credit agency that is cahoots with the scammer. (You can tell I am old because I still use words like ‘cahoots.’) This agency sells you an overpriced credit report and then splits the money with the scammer, leaving you with a useless credit report. (I am writing this article because a number of my tenants are graduating soon and will be moving out.) How can you avoid this scam? It is very simple. Get a free credit report and make copies of it before you go looking for a place to rent. Giving a prospective landlord a copy of your credit report along with your application gives you an edge over other applicants. It makes you look better prepared and more businesslike.

Free Credit Reports. By Federal law, you are entitled to a free copy of your credit report once every year from each of the three major credit bureaus: Equifax, Experian, and TransUnion. These 3 companies jointly operate a web site: AnnualCreditReport.com where you can get free credit reports from each of these companies at no cost to you and with no strings attached. Unfortunately, spam e-mails and TV advertising direct consumers to look-alike web sites. These look-alike sites appear to offer free credit reports, but they are usually expensive credit monitoring services instead. In order to get a so-called ‘free credit report’ from these companies, you usually have to give them your credit card number first, after which, they charge your credit card every month for credit monitoring, whether you want this service or not. Stopping the automatic monthly billing to your credit card with some of these companies can be difficult. Here are some tips for getting really free credit reports.

  1. Only go to: AnnualCreditReport.com. Watch your spelling carefully when you go to this site. There are a lot of phony ‘free credit report’ web sites and many of them have names that are just one letter away from the real thing. Never respond to e-mails or TV ads for free credit reports.
  2. Space out your three free credit reports over a year. This will allow you see changes that occur over time.
  3. Print out your credit report as soon as you see it on your monitor. You may not be able to gain free access to it later. Its good to have a printed copy of your credit report on hand anyway, even if you are not looking for a rental. You may find it useful when applying for a job or loan.
  4. After you have your credit report, quit your browser if you are at a computer that is shared or accessible by other people.
My Policy. Yes, I do run credit reports on prospective tenants, but I never charge applicants for it. Charging prospective tenants for credit reports creates ill-will. People don’t normally have to spend money to apply for things, like jobs or credit cards, and people are understandably angry when they have to spend money to apply for an apartment – and then don’t get the place. Besides, how much landlords can charge prospective tenants for credit reports is now regulated by California state law. Because I don’t charge applicants for running credit reports, I don’t have to comply with those regulations.

Craigslist Rental Scams.

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I recently received an unusual request from a prospective tenant He said he was interested in renting an apartment I had listed on Craigslist, but first, he wanted me to show him written evidence that I owned the building. He said he had read several articles about scam artists who claimed to own apartments and collected rent and security deposits from would-be tenants and then disappeared with their money. I told this guy that I have also read articles about this.
If 10 years ago an applicant for an apartment asked me to show him evidence that I owned the building I was renting, I would have thought that he was some kind of nut, but Craigslist rental scams are now so common that I don’t think that a request like this is unreasonable. I told this guy that I would bring a copy of my current property tax bill with me when I showed him the apartment, which I did. I think requests like this are going to become more and more common in the future. I am sure that there are landlords who would be offended by a request like this, but not me. Craigslist provides a wonderful service for both landlords and tenants, and a free service at that; however, Craigslist does not vet the listings on their web site, and unfortunately, there are a lot of very smart people in this world who spend their lives figuring out new ways to cheat and rob other people, and it seems like almost all of them know how to use Craigslist.