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Old 12-01-2009, 07:02 AM
 
Location: Bar Harbor, ME
1,922 posts, read 3,664,650 times
Reputation: 1287

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We are moving in the summer of 2011 when I retire from 40 years in public and private education. Though MDI is in the areas where property is very expensive(tofu is really not good for you, and the Chinese did not eat it as a staple), everything we own is tied into the house we bought there. We got a certified home inspector to go over the house with a fine tooth comb so we know basically what's wrong with the house--- not a lot.

But to make the mortgage we needed a full time renter. With Jax on the island this was not much of a problem especially since there are very very few rentals let alone full time rentals on the island, and especially rentals suitable for a big family.

However, then we had to find a rental agent. That turned out to be harder than we thought it would be. Our first agent seemed nice, but it turned out that s/he(I'm not sharing the name due to potential libel issues) was interested in getting the renters out of the property and into a house that s/he wanted to sell them. This meant that although s/he was taking our money every month, s/he was was not fixing things that went bad, or fixing them only enough so that they would break again soon. One of the problems involved a leak under the sink in the kitchen that s/he fixed with duct tape and was causing a constant drip. Eventually the drip caused mold, and then s/he told the renters that they could get out of the contract because of mold in the house. The renters also were encouraged to leave their windows open a crack in the winter "for ventilation". This caused them to have a constantly cold drafty house and a rather high fuel bill, and more reason for them to want to leave.

The rental agent had told us upfront that s/he was not interested in helping us find a new renter if the one we had should leave, so it was a potential double whammy.

This is all a big problem for us. We do not have a lot of excess cash, and what we have we are saving for the move up and other expenses we have there as well as the repairs to the house we are living in so we can sell it.

Finding a good rental agent for a house where you are 600 miles away, and when you are not a rich middle Atlantic multiple house owner can be harder than it looks.

Our new agent seems very good, and has given our renters good advice. If you are moving up, and are buying and expecting to rent the property until you retire, this is an issue that is much bigger than you might think. We would like to think that our first rental agent was an aberration, but we are not sure about that. Being a rental agent is a difficult job and tenants tend to ask the agent for help---often a lot. Any tenant who had never lived in an old farmhouse will need lots of coahing about the difference between it and apartment or development living. Rental agents can sometimes forget which side of the owner/renter fence they are supposed to be on. If the agent provides good advice this helps the owner; if the agent provides bad advice this can be expensive for an owner.

zarathu
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Old 12-01-2009, 07:06 AM
 
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Just out of curiosity, how much does a rental agent make and how are they paid? Is it a percentage of the monthly payment? Or a lump sum fee?
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Old 12-01-2009, 07:14 AM
 
Location: Bar Harbor, ME
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Ours get's 10% of the rental payment. That's actually pretty cheap. A more standard is 12-13%, and as much as 15% if they are expected to interview potential new renters. Any things that need fixing are extra, it only pays for them to respond to renters quickly and find someone to fix it(like a plumber or an electrician.) Plumbing is the usual emergency problem.

This can be quite a bite if one is expecting the renters to help pay for a $1400 mortgage. Fortunately we have developed a network of friends on the Island, maybe more than we have here at home, and we were able to find someone at a lower rate. But it also meant that we had a special incentive to keep the renters we had rather than have to pay 5% of $1400 for new rental find services.

zarathu
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Old 12-01-2009, 08:15 AM
 
643 posts, read 1,254,134 times
Reputation: 620
Hmm. Very interesting.

We are renting for the first time in nearly 30 years and so now we have both perspectives. Quite frankly I'm not a big fan of realtors (apologies to all who resemble that remark) yet when it comes to renting I don't think I would search again for rental property without one. We had one we were using while we were searching and while he didn't come up with the right property for us - he was extremely helpful and was gracious when we found this one. The house we did lease was handled by a different realtor and even though he represented the owner, he too, was extremely helpful to us. The comfort level was the main benefit and I think it's a matter not only of sourcing the right potential renters, but also adding to the clarity of communication on both sides. I've done it myself as a landlord before and what a PITA (my new favorite acronym that I just learned from Mermaid on another thread).

On the other hand, the fee range you mentioned is pricier than I thought it was - and I can see your point. Agents, however, are not (usually) property managers and I wouldn't expect one to make repairs. Maybe because of your distance from the rental house, you want someone who will also manage the rental property? Or perhaps since you know people in the area you could find a handyman who can be available for repairs if/when needed, and then you can expect your lease to be upheld for the mutually contracted timeframe. I don't think landlords should expect renters to make repairs. They can be liable (like with the subsequent mold) for something not done the way you want it done. We always spent a lot of money on home maintenance as owners and we don't expect to do so as lessees because it is not our investment.

We take exceptionally good care of the house we are leasing, but when it comes to repairs, we expect the owner of the house to take care them professionally and post haste.
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Old 12-01-2009, 09:15 AM
 
Location: Bar Harbor, ME
1,922 posts, read 3,664,650 times
Reputation: 1287
Sunday1

My brother in NC is both a property manager and an Real Estate Broker. Last told he had more than 500 properties in the Greensboro area that he manages. He has several maintencance and repair crews on independent contract retainer, and they simply go from house to house to house every day repairing things.

Since our rental is distinctly short term, we only wanted an agent who could take the rent, answer questions, and deal with any emergency that might arise. For things that are not emergencies we deal. Recently I called the local Propane dealer to come over for an inspection. And last year, the renters called me to tell me that the cook stove had died. We selected one that we liked for our use, called an area dealer, purchased it with a card and had it delivered to the house. We've done the same for non-emergency plumbing issues. If we had a rental manager, all those things would be handled entirely by the manager. For new appliances we need to select something we will like in the house, since in 19 months they will be ours to be using.

We have found a local Realtor who also handles some property for friends, and we have become her friend.

Like you, we had a broker who arranged the sale fo the house and did the initial arrangement for a renter, since he knew that finding one was sort of contingent on making the sale work. But while he is the best realtor on-island as far as I'm concerned, he's not into the rental management business except when he has to. Being a rental agent or manager takes a certain kind of feisty temperament since renters can be difficult at times. I know, I used to be a renter.

zarathu
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Old 12-01-2009, 09:26 AM
 
Location: Gorham, Maine
1,815 posts, read 4,267,470 times
Reputation: 1240
Quote:
Originally Posted by Zarathu View Post
We are moving in the summer of 2011 when I retire from 40 years in public and private education. Though MDI is in the areas where property is very expensive(tofu is really not good for you, and the Chinese did not eat it as a staple), everything we own is tied into the house we bought there. We got a certified home inspector to go over the house with a fine tooth comb so we know basically what's wrong with the house--- not a lot.

But to make the mortgage we needed a full time renter. With Jax on the island this was not much of a problem especially since there are very very few rentals let alone full time rentals on the island, and especially rentals suitable for a big family.

However, then we had to find a rental agent. That turned out to be harder than we thought it would be. Our first agent seemed nice, but it turned out that s/he(I'm not sharing the name due to potential libel issues) was interested in getting the renters out of the property and into a house that s/he wanted to sell them. This meant that although s/he was taking our money every month, s/he was was not fixing things that went bad, or fixing them only enough so that they would break again soon. One of the problems involved a leak under the sink in the kitchen that s/he fixed with duct tape and was causing a constant drip. Eventually the drip caused mold, and then s/he told the renters that they could get out of the contract because of mold in the house. The renters also were encouraged to leave their windows open a crack in the winter "for ventilation". This caused them to have a constantly cold drafty house and a rather high fuel bill, and more reason for them to want to leave.

The rental agent had told us upfront that s/he was not interested in helping us find a new renter if the one we had should leave, so it was a potential double whammy.

This is all a big problem for us. We do not have a lot of excess cash, and what we have we are saving for the move up and other expenses we have there as well as the repairs to the house we are living in so we can sell it.

Finding a good rental agent for a house where you are 600 miles away, and when you are not a rich middle Atlantic multiple house owner can be harder than it looks.

Our new agent seems very good, and has given our renters good advice. If you are moving up, and are buying and expecting to rent the property until you retire, this is an issue that is much bigger than you might think. We would like to think that our first rental agent was an aberration, but we are not sure about that. Being a rental agent is a difficult job and tenants tend to ask the agent for help---often a lot. Any tenant who had never lived in an old farmhouse will need lots of coahing about the difference between it and apartment or development living. Rental agents can sometimes forget which side of the owner/renter fence they are supposed to be on. If the agent provides good advice this helps the owner; if the agent provides bad advice this can be expensive for an owner.

zarathu
zarathu, this is a very sad story and I'm sorry you had to experience it. Your agent clearly had a conflict of interest. Even in Greater Portland there are very few agents that do rentals so there is not the choice that you have in home sales and I know you have even less to choose from on MDI. The agent that I refer my rentals to works for a property management company and doesn't sell houses. Her job is to keep the house rented and in good repair to protect the investment, not to move the tenants into a home of their own. With more and more houses becoming available to rent from absentee owners, this issue will continue to grow. As with any contractor you hire, interview as many as you feel are appropriate and get references. Best of luck with your new agent.
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Old 12-01-2009, 09:50 AM
 
Location: Bar Harbor, ME
1,922 posts, read 3,664,650 times
Reputation: 1287
Our current renters want to buy on island, and we want them to be able to do that. With my wife in primary education and me also, we have a special fondness for little kids and they have three.

So.... our renters are not just renters to us, we want them to be friends too when they eventually move. And we want them to keep the house in good shape as our current financial situation allows, since this is not just a rental house, its our house in 19 months.

While we don't need a property manager, we do need a rental agent who in an emergency can tell us what needs to be fixed and what is just a wishful thinking on the par to the renters. Our renters didn't like the carpet that was in the living area downstairs, so they asked if they could pull it up. since we didn't plan on keeping it anyhow, we didn't mind, but when the renters now found that their floor was cold without a carpet on it, we didn't feel obliged to spend 1000 bucks insulating the basement floor. A good rental agent could give them advice about this. A bad one would tell them to pull up the carpet but not tell them what the consequences might be, and then badger us to pay to have the floor insulated. BTW, I can insulate the floor myself for about $200 max in materials. A local contractor gave the agent an estimate of $2400(I was prepared for maybe $700), and only hold that for a couple of weeks. I wondered immediately whether the whole thing was engineered by the agent(encouraging the renters to ask to pull up the carpet knowing that the floor would be cold) to try for a rake off with the contractor. I try not to think such bad thoughts......

It can be difficult. Newbies who want to move up as retirement for a later time and rent until then should know some of these pitfalls.

zarathu
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Old 12-01-2009, 10:57 AM
 
63 posts, read 118,598 times
Reputation: 42
You could always just advertise yourself and skip the hassle of an agent. Pretty much every tenant with a computer looks on craigslist nowadays, and it's free to advertise. That's where I found the rental I am sitting in now.

What your previous agent did to those people is so beyond unprofessional and malicious. I would try to get their fee back...duct taping the pipe which eventually gave you mold? Didn't they tell you what they were doing or that the tenants complained? That's just incompetent. But telling them they can back out of your lease due to a condition with the house that s/he caused, that is extremely unethical.

I also want to let you know, since we are talking about unprofessional agents, that ultimately you are responsible for any harm your "hired agent" does to the tenants - whether it be a rental agent, a plumber, a house cleaner - whoever you hired to perform services related to the house. Essentially, it would be your problem for hiring bad help if the tenants ever decided to bring action against you, so I would advise that you watch what your agent does and make sure they are doing their job.

An example of this is when we rented a house in Vermont which we later found out to have radon in it. We found out near the end of the year lease that the realtor lied to my face when I asked her about it during the initial showing, playing dumb to the radon problem. The landlords actually went out of their way to tell her about the radon so that she could tell potential tenants.

After speaking to a lawyer, she informed us that we could have sued the landlords for the entire years rent, and would be guaranteed at least half the year in court due to the agent lying about the radon. We already had plans on moving to Maine by then, and had no health problems or anything like that, so we just walked away from it all.

What would happen to the agent? Absolutely nothing, unless the landlords filed suit against her themselves. She was free and clear as far as us vs. the landlords if we did file a suit.

So in short, it may be smarter to just rent it yourselves. If the agents perform badly towards the tenants, it's your responsibility, not the agent's. I don't think agents provide that much security in terms of the screening process anyways, and definitely nothing that you can't do yourselves.
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Old 12-01-2009, 11:11 AM
 
Location: Bar Harbor, ME
1,922 posts, read 3,664,650 times
Reputation: 1287
Coastal photographer,

While the problem with the previous agent was instructive, its way over the barrel now. we've learned from it. Our new agent and us have a productive relationship for which its imperative that we both stay on good grounds with each other since we have another relationship outside of the business one. Its kind of a check against what happened.

As to us renting without an agent present, if we lived within 45 minutes of the house we would do that most definitely. Unfortunately, living 600 miles away doesn't give us any opportunity to double check what a renter might be telling us. For example if the renter tells us there is mold in the dirt basement, how would we know unless we could visit and find out? Also if we needed a new tenant, there is no way I would do that without actually meeting them. I've dealt with Craigslist before. I actually sold a property recently in PA from an original Craigslist ad, but then the buyers visited with the broker twice, and then with me once before we actually accepted an offer from them.



No..... for an owner who is very far away, either a rental agent or a property manager is an almost necessity.
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Old 12-01-2009, 11:48 AM
 
63 posts, read 118,598 times
Reputation: 42
Quote:
Originally Posted by Zarathu View Post
Coastal photographer,

While the problem with the previous agent was instructive, its way over the barrel now. we've learned from it. Our new agent and us have a productive relationship for which its imperative that we both stay on good grounds with each other since we have another relationship outside of the business one. Its kind of a check against what happened.

As to us renting without an agent present, if we lived within 45 minutes of the house we would do that most definitely. Unfortunately, living 600 miles away doesn't give us any opportunity to double check what a renter might be telling us. For example if the renter tells us there is mold in the dirt basement, how would we know unless we could visit and find out? Also if we needed a new tenant, there is no way I would do that without actually meeting them. I've dealt with Craigslist before. I actually sold a property recently in PA from an original Craigslist ad, but then the buyers visited with the broker twice, and then with me once before we actually accepted an offer from them.



No..... for an owner who is very far away, either a rental agent or a property manager is an almost necessity.
Hi Zarathu,

Sorry, I guess the point of your thread went completely over my head, I thought you were asking for help with finding an agent to lease out your house.

I was strictly referring to the agent side of things however; of course it would be better to have a property manager/handyman on call for the tenants. Although I think the example of lying about mold in the basement would be a stretch. I can't imagine any tenant saying there was mold when there isn't, when you would be calling someone to go over and inspect it or otherwise fix the problem immediately. What are they going to say? "Oh well it was there yesterday..."


My point was that you can find a tenant yourself without having to pay a months rent + for an agent to do it. The last home we were in and the house we are in currently, the lease was arranged entirely over the phone as both owners live outside of New England. However they are both selling the home and have no intention (as far as I know) of moving back, so I can see why you would want to have someone interview tenants in person. Also, sounds like you've already signed a contract with the new agent so seems like it's beyond this point, as you said. However, it sounds like you found a very nice agent (although I can't imagine them being any worse than your previous one, haha). The outside relationship will definitely keep everything on an even keel.
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