Paying A Tenant To Watch The Place
I have recently purchased a 7-unit apartment building. There is one tenant on site that handles minor repairs, shows apartments as needed, collects & deposits rent checks. I am wondering what is the best way to set up paying him for this and how do you determine a "fair" price.
I live a distance from the property so I want him to handle these small day-to-day things (as he did for the prior owner). The prior owner just worked with him very informally and so I don't have a lot to base it on. I won't a more formal agreement so there aren't misunderstandings later.
I know property management companies charge 7-10%, but I don't see him filling that full roll. Also when the unit is full (as it is now), there really should be minimal work. I am considering offering him $100 per month and allow for flexibility as things come up. Total rents are $3,600.
Please let me know how others have structured such arrangements.
don't know your answer but here's what happened to me. I bought a property November 1. There is a free standing garage and a neighbor man has had the free use of the garage and 2 storage sheds for the past 22 years in exchange for mowing the lawn and shoveling the snow. The property looks very well maintained. Last night we had our first snow fall although it wasn't very much. We went and shoveled & salted the other properties. On our way home, we went past this one and nothing had been done. This was approximately noon and the snow stopped sometime over night. So, I had my son shovel and salt the stairs & walks here also. While he started, I went to the neighbor's house and no one was at home (I had already figured that because he also parks on my property and his car wasn't there). I called and let him a message but haven't heard back and it's now 7 hours later. Don't know what happened or what he's been used to but he's surely not going to continue to receive a $75 a month garage if the snow isn't shoveled before the flakes finish falling. (well, perhaps I'll give him a tad longer than that) I believe the city gives 8 hours but I can't give him 8 hours (even though today was a lot longer than that) because I've got to have it done prior to the 8 hours. Looks like I'll be pounding on his door tomorrow.
I have a tenant whose boyfriend spends lots of time at her place. I know he doesn't live there because I have been there several times when he is not there.
Anywyay, one of my units came available and he solicited me to do some painting and clean up of the vacant unit. I was very reluctant at first to hire this man, but in the end it turned out great. He did the painting, has shown the unit for me on several occasions, and even helps out with making signs. It is also nice to have someone around who can keep an eye on the place when you are not around.
My advice is to talk to him and ask what the previous owner was paying him - then discuss what duties you want fulfilled in order to make sure there are no problems in the future. It sounds to me like he will make it so you only have to show up to collect rental applications or when someone moves in or out. To me, that is worth at least $100 per month.
Good luck