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JULY…..FUN IN THE SUN
The market is definitely at a “cooler” temperature this month – unlike the thermometer! Prices are fairly stable and there are even some price reductions showing up. The hot, hot, hot seller’s market may have finally given way to a more balanced one, giving buyers a chance to take advantage of an unusual “buyers market” summer window. And how about those low interest rates? Thank you, Brexit.
But the sunny weather is just the right time to take in some FREE events going on around the Valley. Campbell has its Wednesday evening music concerts at the Civic Center. Los Gatos has Jazz on the Plaz on Wednesday evenings as well, and Music in the Park on Sundays at 5. Willow Glen has a regular Thursday evening music series at the WG Elementary School. Bramhall Park in Willow Glen hosts Shakespeare and some opera – check their schedule of events at when.com/Bramhall Park Willow Glen. Symphony Silicon Valley should be coming along soon with their week of concerts in the SJ State Quad. Grab a lawn chair and a picnic basket, and enjoy!
NEWS YOU CAN USE:
We thought the following information might be helpful to those of you who are landlords, or are considering renting out your home for the first time…
More and more Americans are choosing to rent instead of own, making for a competitive renter’s market that leaves landlords with the pick of the litter when it comes time to place a tenant. As you have more leeway in the selection process, make sure your lease is up to par with all the provisions you need to keep yourself and your personal assets safe. If you are drafting your first lease agreement, or just looking to make some smart additions, consider the following lease provisions that are often overlooked.
The following clauses are not the only clauses that should be included and nothing in this article is an attempt to give legal advice or suggest that other clauses are not as important. But, as you read each suggested clause, you will see why each of the following recommendations are included. But nothing takes the place of retaining a lawyer who SPECIALIZES in landlord/tenant issues and the drafting of leases. In the long run, it will save you thousands of dollars in litigation which you could lose because you attempted to draft your own lease agreement or took a “form” agreement and tried to revise it to fit your needs. So, read on!!
It’s becoming more and more commonplace to require renters to purchase their own individual insurance. Should any natural disasters or accidents happen, you may find yourself paying extensive deductible fees to cover repairs on damages. If your tenant were to have something like Allstate renter’s insurance, their coverage would likely cover the cost of your deductible. This provision is ideal for both renter and landlord, as both their personal possessions and your personal assets are covered in case the worst happens. Make sure you have a clear understanding of just what is covered under your tenant’s plan before signing off on the lease.
A Set Number of Tenants
This may seem obvious, but make sure you put a provision stipulating the exact number of people that can live in your home. You may find the perfect tenant, and realize months down the line their boyfriend or girlfriend and four kids have moved in. It’s a common occurrence, so make sure you stipulate verbally and in writing that only the signed tenants can reside in the home. Forgoing this important step means potentially allowing un-vetted individuals to live in your home.
Decide on Subleasing
If you don’t include a clause on subleasing, be fully prepared for your tenants to take advantage of the situation and look to make a little money off of your property. Most common in communities with college students who will leave for the summer months, subleasing can be an essential part of your rental agreement, but it comes with its fair share of challenges and potential consequences. The problem with unregulated subleasing is that it allows new tenants to reside in your home that haven’t been checked for criminal pasts or eviction histories. If you do decide to allow for subleasing, make sure you require your tenants to submit applications for the subleasees to be vetted through a service like MySmartMove. It will give your long-term tenants the flexibility they need, and ensure your home isn’t vulnerable to the damage of strangers you haven’t approved.
A Pest Provision
You might not have thought to put pest control on your lease, but it can be an important part of the rental process. If you have a pre-existing problem, laws require you to take care of it for the tenants. However, if poor hygiene or living habits on the part of your tenant is the main cause of pests, you don’t want to be responsible for paying for pest control and cleanup.
Charging a Late Fee
If you’re using a general template for your lease, you might not already have a clause including late fees based on rent checks that arrive late. Varying states and localities have different regulations in place about how much of a late fee you can charge, so be sure to check with legal counsel before you try to enforce this rule. Not only do you need to get your late fee charges in writing, but you also need to remain firm in your practice. Letting it slide once means letting it slide every time, and you need to remember that your rental property is a business, and your tenant is not your friend.
Whether you’re renting out your home for the first time or you’ve been a landlord for years, it’s always a good idea to review your lease provisions before allowing a tenant to reside within your property.
Finally….if you’re in the market to purchase, here’s an interesting graphic of the digital tools at your disposal. And Sellers….this is how buyers are finding you these days!
We’ll be back next month or so, with another Real Estate Update. In the meantime, enjoy the summer!