How do you charge for long term property rentals?

[rentingintl]

1) Can anybody please share with me if you for long term rental properties normally charge a security deposit equivalent to 1 month's rent + the first month rent + last month rent?

2) And if the tenant wants to renew their contract for another year let's say, do you carry over the security deposit and the last month's rent over into the new contract? If so, has it happened to you that the tenant doesn't pay their last month rent thinking they paid it in their current contract? What do you do in such a case?...Just charge them the last month rent again for the new contract?.

3) Can anybody please share with me a sample of the clause from your rental contract about renewals?

Thank you in advance for your kind advice.

 

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[Cat Man Du]

Here ya go. If they use their last month for the 12 th month...ya collect it again !!

LEASE RENEWAL/EXTENSION AGREEMENT



According to Paragraph 3. of original lease beginning Aug. 1, 2008, between xxxx, lessor and xxxxxx, lessee for unfurnished home located at anytown, USA. it is hereby understood and agreed by all parties to the original lease to renew or extend said lease for a period of 12 months , beginning Aug. 1, 2010 and ending July 31, 2011 at the same monthly rent of $1,180.00. All other terms of prior lease to remain in effect.




DATE ___________________ LESSEE _________________

DATE ___________________ LESSEE _________________




DATE___________________ LESSOR _________________

 

[jrmartin]

I used to own a property management company down here in Florida and the golden rule was always to charge them as much as you could up front in case anything goes wrong during the lease period. We even had investor owners who asked us to charge a little less per month in order to attract someone who would put down 1st/last/security.

That being said, assuming this is just normal for the area housing and not something more high end or vacation type: the less money you require someone to put down, the faster that unit will get rented. One of the biggest problems that we had down here (SW Florida) over the last 5 years or so is that we had so much vacant housing built during the boom that the rental market became absolutely flooded for a time being. This caused home owners to not only drastically drop the rental rates in the area, but the restrictions for moving in and in many cases even the credit and rental history restrictions. Its not as bad as it was down here at this point, but its pretty fair to look around at the other rentals in your area and see what they are having to accept to get a renter in the house.

2. If they dont pay they owe. Also, never give a security deposit back until they have moved out of the property and you or someone from your managment company has been in there to physically inspect the property.

 

[LagunaLauren]

I charge security deposit equivalent to 1 month's rent and 1st months rent, not last also. Is a lot for a renter to pay out all at once. I typically do 1 year leases, then renew yearly or month-to-month. I don't do last month's rent up front, so there's no keeping it or returning it when the lease expires/renews. And yes, I've had people skip out without paying their last month's rent. Most of my tenants have been good & long-term, though.

 

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[NoMoneyDown]

It's both a science and an art to really arrive at a good amount for a security deposit. Of course, the #1 thing to check is the laws for your area to make sure you aren't over-charging. And, as jmartin suggested, you want to get as much up front as you don't want to be left short-handed when a tenant moves out and the SD doesn't cover all the damage they left. Conversely, as LagunaLauren said, charging a lot up front can lessen your prospective tenant pool, though. Especially, when in many cases tenants have to come up with hefty utility deposits as well.

All that being said, I typically charge 1st month's rent + security deposit equal to 1st month's rent. On a rare occasion, I may let the tenant split the security deposit over the 1st two months.

 

[Qjet50]

My rental agreements have specific sections for rental rates and occupancy. So at about the 10 month mark in a 12 month lease I will send a letter and rental agreement amendment to the tenant that updates these two sections of the rental agreement only. If they agree, they sign the amendment and return to me.
[FONT=&quot]Good points by all to check state/local laws on allowable deposits. In my location, a security deposit cannot be more than one months rent.[/FONT]

 

[hatterasguy]

A standard residential rental contract is usualy 1 year, they have to pay 1st + last+ 1 month securty when they sign.

Oh and no pets, especialy cats!

 

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[EasyMoney_in_NC]

I charge a SD equal to the monthly rent. If I have to prorate a month (they move in mid month) I collect that before they move in (rent divided by a 30 day multiplier no matter the month). If they move in within the last 10 days of the month I also collect the next months rent too.

On top of that, pets bring a fee of $250 each (no more than 2 and under 25 lbs) and a monthly rent ($10-20 ea). I usually have no problem getting it either.

I'm just trying my first attempt at section 8 and I also charged a $300 cleaning deposit (mainly to dissuade, didn't work) on top of everything else. Can't wait to see how this pans out in the coming months. I like the idea of guaranteed gov'nt money, just hope its enough to cover my nut in case the tenant bails (still don't know her part vs.gov'nt)