The Smart Apartment Advisor Show for Wed. Aug 31st

How to #Hack Your Housing Hunt. Pro tips on apartment hunting in SF. Plus, Landlords worry about renting in the Winter, I've got tips for you too!

Sorry to have missed last week’s show. Back from backpacking trip. 

I’ll be on Brian Copeland’s show on KGO 810AM on September 28, not September 7, at 3PM. Looking forward to discussing this and other fascinating topics with Brian on the radio next month!

Trivia Question for a Copy of My BOOK! Our standard policy is to get a rental application from all individuals 18 years of age or older at the time they move into an apartment. Under what circumstance is someone under the age of 18 allowed to rent an apartment on their own?  ANSWER: An Emancipated Minor.

1. Realize that the Rental Housing Market in SF has seasons - The main drivers of people moving into and out of the City are employment and school schedules. I typically see the greatest demand for apartments between April 1 and October 31 of each year with a slight lull in late June and July. The reason for this is that more employers tend to hire during this time and local universities are beginning their school years in the late summer and fall. Employers typically seek to have people situated before the holidays. 
   • People who already live in SF and are moving to a different home do so for a variety of reasons. They include:
     • Upsize/downsize - people coming from a roommate situation to move into their own place, moving in with significant others or breaking up with significant others, change of jobs making different neighborhoods more convenient, wanting better access to transportation, etc.
     • These situations are more flexible than the situations of people moving to SF from outside the City so these tenants can get a better deal if they can wait until the down months from November 1 to February/March to undertake an optional move. Let the people who absolutely need a place have it before you go rushing in to join the fray.
   • Property owners can’t necessarily time the market on vacancies. Tenants can give 30 days notice at any time and they’re hard pressed to hold a unit off the market for demand to recover at a later time. They’d rather not have vacancies in November and December because people would just rather not be moving then.
   • Halloween leads to Thanksgiving leads to Christmas then credit card bills, tax time, and it’s April 15 before people feel set. Weather is also a factor even in SF. The market is rather like bears going into hibernation.
2. Tenants: be prepared
   1. Have your rental reference ready or be prepared to explain its absence. 
   2. Bring paystubs. I am not as comfortable looking at deposits in a bank account as looking at actual pay stubs. Offer letters are typically good too. 
      • If you’re self-employed be prepared to share the first page or two from your tax return showing your adjusted gross income. 
      • Verifying your pay is ESSENTIAL. This is how you’re going to pay the rent so if you can’t do this you’d better have a great explanation and a strong guarantor.
   3. Understand that you’re going to have your credit report run a few times in the process. Know your FICO score and be prepared to address any issues or collections that pop up. It’s fairly common for me to see collections items on people’s credit reports. 
   4. Ask how applications are screened. Is it first-come, first-qualified or is it a jumbled mess? Try to go for a fairer situation where the owner is going to process the applications in the order received.
3. Negotiation Tactics
   • Tenants - fewer tenants try to negotiate with me than I would expect. Give it a try but don’t low-ball on the price. I prefer to know who you are before I commit to a deal so be prepared to give me your details before I decide if I’m going to counter your offer, accept it, or reject it.
   • If you throw out a number before you’ve applied then you can decide based on the owner or manager’s reaction whether it might be worthwhile to submit your application.
     • Smaller units have less room to negotiate than larger, more expensive units. 
     • For property managers the room to negotiate is on a case-by-case basis depending on the client. Sometimes there’s room, sometimes there isn’t.
     • If there is a lot of interest in a unit then you’ll probably find that the owner isn’t motivated to negotiate.
     • Timing - nobody does this but you could offer to sign right away for a discount off the monthly rent or to pay the asking rent for a lease that starts in 2-4 weeks. Give the owner a chance to tell you what means the most to him or her. Is it time or dollars. You might not get either but it’s a good starting point.
   • Property Owners - don’t panic when units don’t rent in the wintertime. In SF’s Rent Controlled environment don’t reduce your asking rent as quickly between November 1 and April 1 as you would during the spring/summer months. In the long-run it’s better to have a higher rent than to fill your vacancy right away. 
     • If you find yourself with a vacancy in the wintertime you could offer a move-in incentive of a lower rent or a delayed lease start date in exchange for a longer term lease. For example, instead of a 12 month lease from October 1 to the next September 30 you could ask for a 18 month lease from October 1 to March 31 so the tenant will agree to stay through the following winter and, if they decide to move then, you’re not stuck with a wintertime vacancy again.
     • If you don’t want to negotiate with a tenant be polite and reiterate your asking price. Don’t take it personally. It’s just business.

Are You Kidding Me? Tenant gave us a tax document to verify income for a single-family home. Turns out the form was falsified (typed in on PDF but not something sent to the IRS) and the tenant later told us they were going to try to use the house as a marijuana growing facility.