There were hopes just a few weeks ago that the worst of the covid-19 pandemic were behind us. Now, as of early July it appears that the virus is going to stick around for a while longer. While no one seems sure what the future holds, I can say that our landlording business has been adjusting to covid and that many of those adjustments may be here to stay.
Social Distancing Is The New Way To Conduct Business
We are all being advised from multiple sources to keep our social distance, especially between people that you do not know. For our business (and many others) social distancing has meant shutting our office down and going as remote as possible. Having actual daily contact with employees or contractors is simply not advised. Tenants are no longer provided the option of dropping off rent checks or asking for a repair in person. All of that is now handled online without contact. We work from home. Our employee works from home. Rents are collected electronically (mostly) and repair orders are handled through our property management software. Face to face office contact has been cut to signing a few checks.
Taking Precautions
We have instituted many covid precautions. Our contractors are now required to wear masks when going in a tenant’s home, no exceptions. They are also required to social distance as much as possible and wash their hands frequently as well as thoroughly clean up after themselves. We have not stopped making repairs or attending to our tenant’s needs, but we are prioritizing repairs based on a perceived risk and trying our best to mitigate that risk for both our tenants and contractors. I’m sure new policies and procedures will evolve as we all learn more about the virus.
Business Does Go On
Business does however have to go on some how. Showings to perspective tenants, lease signings, move ins and move outs still happen. Some contact is just going to be unavoidable. However, the risk of contact can be reduced. Before showing a property these days, perspective tenants are screened a bit more than they were pre-covid. We are making sure that they really do need to move in the near future (and are not just being lookie lous) and that they have the means to afford the property before we will show it to them. These days we pre-qualify applicants, open the property up for them, step back, let them look, ask them not to touch anything, wipe it down when they are finished and conduct further discussions outside.
We have also stopped showing occupied properties. If a tenant has not yet moved, we do not want to have strangers tromping through their home. We have videos of most of our properties that can be reviewed online. Otherwise applicants just have to wait until the property is vacant. Again it is all about keeping contact between people to a minimum. This does hurt our property turnaround time a bit, but it is a necessary caution.
What About The Numbers?
Rents have not really declined and have instead been holding fairly steady. After a relatively calm period during the first few months of the covid pandemic we have seen a small uptick in tenant turnover. Some tenants are telling us they simply cannot afford it anymore and are moving back home. However, we have generally been able to re-rent these properties without too much hassle and without discounting the price. Over all, despite the social distancing and economic slowdown, business has been steady.
What About Evictions?
The eviction courts have reopened here in Tennessee but we have not had to go that route as of yet. As I have written before, eviction is something we try to avoid with screening and we are screening even harder as I mentioned previously. We have had to make a couple of workouts with some tenants who were struggling with income losses due to the virus and I think until the economy further adjusts, those types of things are going to continue. The majority of our tenants have been honest with us if they are running into problems and we have worked with them to find a solution that works best for everyone.
All in all the major adjustment is simply not seeing folks as often as we did in the past. Today it is all about keeping contact to a minimum. I’m not sure how easy all of this would have been a couple of decades ago before zoom, Hello Sign and other websites. Thankfully these sites make getting through this pandemic much easier. Yes, we have had to make adjustments and as a small company we have been able to do that. Will, things ever go back to the way they were? I doubt it. In fact, I think our business may be better off in some ways. Time will tell.
What are some changes you have had to make to your business as a landlord? Please share with a comment.
Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors. Subscribe to Smarterlandlording here. Contact Kevin here.
