Re: Vacancy Rate - Posted by Frank Chin
Posted by Frank Chin on July 27, 2006 at 08:05:45:
Matx:
You win some, you lose some. Sounds like you have a system similar to mine.
While I try to go for those who’ll stay the longest, as you said, credit for 90% or more of them are lousy, I wind up reluctantly picking one outside of the “stability” criteria sometimes. And those with sterling credit I don’t expect to stay for long. It’s just the nature of the rental business.
A number of years back, it was a slow August, and I had no good prospects for a rental from those who applied, and held the rental over another week. One fella, named Bart, saw the place early on, really liked it, and called everyday.
At first, I told him the we’re processing another applicant, which wasn’t true. Then, by the end of the second week, still running the ad, Bart called to ask why we’re still advertising, and how things went with the other applicant.
Bart planned to move in with a live in girlfriend. This girlfriend, as I recall, is the daughter of an millionaire industrialist from Brazil, living off a sizable monthly allowance from dad. She’s rather quiet and demur. Bart, on the other hand, works part-time behind the counter of a hardware store, is a fast talker, and loud.
I addition, Bart roars in on a motorcycle, and tattoos up and down both arms. The stability factor is close to zero here.
I had to decide whether to keep advertising, lower the asking price still more, lose another 30 days, or rent to someone calling me on it everyday. My final decision was, we want stable people so we won’t have to do this again. But if things are so slow, why not rent it out, and if they’re gone in a year, or less, we’ll have better luck. Afer all, tattoed motorcyclists and their girlfriend got to live somewhere.
And you have to consider if the tenant such as this will wreck the place. BUT, experience had shown me that it depends on the women, and someome neatly dress, softspoken as she, is not the type that will live in a wreck.
So I explained to Bart that we’re looking for someone who can stay at least two to three years, and we’re procssing another couple (which didn’t exist). We’re hoping someone will materialize. Bart shook his head, “no, no, no, I plan to stay several years. Where will I go??” I know the answer to this one is he’ll wind up on the street, but I kept it to myself.
I can see Bart is mooching off a rich gilrfreind, and the incompatibility of the two is quite apparent. My answer to Bart was “you may think you’ll be here several years, but I already KNOW that you won’t last more than a year”, with a smirk on my face. Bart said “how do you know that?”. My reply “I’m in this business long enought to know”.
So I rented him the place, explaining to him “I’m making an exception because I like you so much”. Have to learn to lie with a straight face in this biz.
I go by each month to pick up the rent checks, and most times, Bart was around, and on the second or third month he asked if I was going to paint the lobby and hallway as I mentioned. I told him that it all depended on him since he won’t last a year anyway, telling him “I don’t want to paint the place, and find that you’ll be moving out the following week.”
Each month he laughed at me pointing out he was there six months, then seven, and on the eighth I finally gave in painted the place, as it needed it. He wanted to take a bet with me on the ninth month, that he’ll stay a year, and he goaded me into taking on the bet that he’ll be there at the end of one year.
I thought it was a foolish bet for me, and I’ll wind up with egg on my face, but if I’m wrong, at least I have a longer term tenant than I thought.
What do you know.
On the end of the 11th month, Bart’s girlfriend threw him out. She left a few months after. As it turned out, the market turned out better, and the next tenant was with me several years, up to the time I sold the place. In fact, he stayed on with the new owner, even paying market rent.
On his departure, I told Bart, “you just have no idea that you won’t last a year, but I do”.
I’m right about 80% of the time, and in some cases, it actually worked the opposite, where I rented to someone expecting a one year tenancy, and like the young pharmaceutical salesmen that move out to be with a girlfreind, lasted more than three years with me.
Now that I’m thinking about it, busy people traveling a great deal has little time to date, to move, adding to the stability factor. And then the uglinest factor etc.
Isn’t this business fun??
Frank Chin
